E. Timor not seen effecting big investors in Indonesia
E. Timor not seen effecting big investors in Indonesia
AUCKLAND (Reuters): The violence and bloodshed in East Timor
is leading potential investors to put their plans on hold, but
existing investors are not fleeing en masse from Indonesia,
Prudential Asia Investments Ltd President and chief executive
Douglas Fergusson said.
"In the shortest of terms, there will be potential investors
who had been hoping and looking forward to and, indeed, wanting
to contribute to the recovery of Indonesia who will say, well,
gosh we better wait a little bit and figure out what's going on
here," Fergusson told Reuters in an interview on Sunday.
"Will it have a long and lasting effect? I think that answer
will be determined by what happens next."
The East Timor crisis would definitely be a setback for
Indonesian economy in the immediate term, but if the situation
settled down quickly it would not cause irretrievable damage, he
said. He did not see any knock-on effect for the rest of Asia.
"I haven't heard (that from) anybody who I've talked to, and
it certainly would not be my opinion that, because of what's
happened in East Timor, that'll affect my investment in Asia as a
whole ... I think we view East Timor as Indonesia-specific
situation, unlike the Asian crisis."
The problems with Indonesia's overall investment
infrastructure -- a combination of social, political, economic
and financial factors -- were well documented and those who had
concerns about the country would have already pulled out,
Fergusson said.
"I'm not anticipating necessarily pulling out because, in
fact, a lot of the value has already been eroded. It's more of a
question of are they willing to go back in and build."
Prudential Asia Investments, a Hong Kong-based investment arm
of Prudential Insurance Co. of America, has some investment in
major projects in Indonesia but its involvement was "not
significant at all", Fergusson said.
Although Prudential was watching with great concern, East
Timor was not making it liquidate its investments, he said.
Fergusson is in New Zealand to attend CEO Summit held on the
sidelines of the APEC leaders meeting on Sept. 12-13.