Dull employment prospects

Dull employment prospects

The Economic Social Commission for Asia and the Pacific
(Escap) predicts that it will take 10 years for Indonesia to
reach 7 percent annual economic growth.

That means the unemployment rate will remain high over the
next 10 years and the roadsides will remained crowded with
vendors. Security disturbances will also remain a danger in these
circumstances.

According to Escap, Indonesia's economic growth in 2005 and
2006 will be between 5 percent and 6 percent. This year's growth
is expected to reach 4.8 percent.

The only formula for dealing with the country's problems is to
encourage investment, which has been sluggish for years. Most of
the investment coming in flows into property (80 percent), with
less than 20 percent going to labor-intensive industry.

The government has been taking steps to boost investment. The
latest move was the issuance of Presidential Decree No. 29/2004
on the centralization of the authority to license foreign and
domestic investment with the Investment Coordinating Board
(BKPM).

This decree is significant, but will the BKPM be able to
handle this authority?

What investors really need is a guarantee of political and
security stability.

The peaceful April 5 legislative election should provide the
impetus for a peaceful presidential election. If the election
takes place without any problems, more investment will flow into
the country, boosting economic growth. The result of this would
be that unemployment could be reduced.

-- Bisnis Indonesia, Jakarta