European business called on to invest more in RI hi-tech

JAKARTA (JP): Minister of Industry and Trade Tunky Ariwibowo called on European business yesterday to invest more in high technology industry in Indonesia.

Tunky said Indonesia would prefer foreign investment to be in high technology because it would add value to the country's economy through the transfer of technology and improvement in human resources.

Tunky said investment in high technology industries would increase people's welfare and make Indonesia a stronger market for European products.

"It would make us rich so that we become a strong market for you," he told an Asia-Europe Business Conference.

The three-day conference, which drew 400 top executives from 25 Asian and European countries, ends today.

Conference speakers included executive director of Singapore's Asia-Europe Foundation, Tommy T.B. Koh; director of Jardine Matheson Holdings and National Westminster Bank of Britain, Sir Charles Powell KCMG; honorary chairman of Total and CNPF International of France, Francois-Xavier Ortoli; president director of Texmaco Group of Indonesia, Marimutu Sinivasan; chairman of Akzo-Nobel NV of the Netherlands Cees J.A. van Leede and executive vice president of Marubeni Corporation of Japan, Hiroshi Matsumura.

"The government will continue to maintain transparency and consistency in its economic policy as well as providing level ground to attract investors," he said about suggestions that Indonesia should improve these areas if it wanted to attract more investors.

Economic ties

Koh said the world was being driven by three approximately equal regional economies: North America, Western Europe and East Asia.

Economic ties between East Asia and North America and between Western Europe and North America have been developed, but ties between East Asia and Western Europe were still weak, he said.

Koh said European companies were less active in Asia because they lacked knowledge of Asian markets and business cultures, and because there was a lack of transparency and clear, stable, regulatory frameworks.

Asian companies, on the other hand, were reluctant to invest in Europe -- except for Britain, Ireland and to a certain extent, the Netherlands -- because they perceived Europe as having negative elements including labor inflexibility and high unit production cost, he said.

Koh called for Asian countries to remove excessive regulations and develop transparency, and on European countries improve their understanding of Asian cultures.

Powell, Britain's former foreign affairs and defense advisor during the tenures of Prime Ministers Margaret Thatcher and John Major, acknowledged that Europe was lagging behind in trade and investment in Asia.

He said each European government needed to designate a minister with specific responsibility for Asia in order to improve European image and performance in the region.

Powell said European business should focus on the business sectors of the future, particularly information technology, which would help Asia achieve quality growth as well as quantity growth.

Powell asked big European companies to help small and medium enterprises enter Asian markets, and called on Asian countries to treat European companies as equal to local companies. (jsk)