Exporters honored

It must have been a greatly exhilarating experience for each of the executives of the 67 companies to receive the Primanyarta award directly from President Soeharto on Thursday. The award presentation, held annually, reflects the government's recognition of the private sector's role as the locomotive of the country's economic growth. The export recognition award also serves as the nation's acknowledgement of the crucial role of exports and consequently the imperative for being competitive in the international market.

President Soeharto again reminded the business community and the state bureaucracy of the urgency of further bolstering exports. He warned that the 17 percent annual growth target for exports during the 1994-1999 period remained elusive. That is greatly worrisome as imports increase markedly every year as a result of the high pace of investments and of the high dependence of the manufacturing sector on basic and intermediate inputs from overseas.

What made this year's award presentation much more significant than the previous ones is President Soeharto's promise that the best performing exporters will be given additional incentives. That should be music to the ears of the businessmen. After all, the businessmen honored have not been working hard to expand their exports just in the hopes of winning the Primanyarta award. If the government honors them for their outstanding export performance, they feel gratitude for the official recognition, accepting the award as a morale-boosting gesture.

However, all the boon they might derive from the award would fade away if their companies were again subject to the numerous hurdles within the export bureaucracy. The export recognition award would be rendered meaningless every time the businessmen encountered the harsh reality of an extreme lack of coordination among the government institutions involved in the numerous links of the exporting process chain.

The government actually has granted a wide range of incentives to stimulate exports, including duty and tax exemptions, free trade zones, credit insurance and export financing, as well as the preshipment inspection system for imports. However, enacting incentives is one thing, while administering those incentives is quite something else. That is the anomaly which often frustrates businessmen. Officials in charge of administering the incentives seem to be inordinately suspicious most of the time, assuming that most businessmen possess inclinations toward crooked practices. The consequence is arduous red tape and excessively elaborate documentation, while speed is the name of the game in the world market.

We wonder why the government has not been able to translate its political resolve into bureaucratic resolve with regard to export facilitation. Abolishing the rent-seeking attitude among many officials and enforcing automatic procedures and transparent rules would strengthen the integrity of the incentive scheme.

There are numerous cases in which the intended effect of government incentives has been nullified by abuse and the rent- seeking mentality on the part of the executing officials. True, documentation is required to prevent abuse by businessmen with crooked inclinations but that should not necessarily mean creating a gridlock in the paperwork flow.

We reckon businessmen do not want a great many additional incentives. They simply need efficient administrative arrangements in designing, implementing and maintaining the appropriate incentives because the fine-tuning of the incentive system takes place in the day-to-day transactions between exporting companies and the export bureaucracy. That, we think, sums up the homework for the Minister of Industry and Trade, Tunky Ariwibowo, whom we know is the most pro-business minister in the present cabinet.