Foreign firms ask for increased security
JAKARTA (JP): Foreign business leaders meeting with President B.J. Habibie yesterday said they wanted to see greater security for their operations and more economic incentives.
The chief executive officers from 30 foreign investment companies said Indonesia remained attractive for business, but the government needed to give more evidence that the security situation in the country has improved before it could convince foreign investors to return to Indonesia.
"The security situation must be reflected on the streets, in the harbors and in areas near our factories," said Eric Chi, president of PT Pou Chen Indonesia which produces Nike and Adidas shoes from its factory in Serang, West Java.
G. Ito, president of textile manufacturer and exporter PT Vonex Indonesia, said his major clients have turned to Thailand or China because they doubted his company could meet delivery schedules because of the uncertain situation here.
Sri Urip, president of the giant consumer product manufacturer PT Unilever Indonesia, gave Habibie a list of complaints and suggestions to restimulate consumer goods distribution and supply infrastructure.
"The security to reside and to operate here remains a big issue," Sri remarked.
When Habibie pointed out that he owned shares in the publicly listed Unilever Indonesia, Sri responded: "Bapak, you're the biggest individual shareholder."
The meeting at the Bina Graha presidential office was also attended by Armed Forces Commander/Minister of Defense and Security Gen. Wiranto, State Minister of Investment Hamzah Haz and Minister of Industry and Trade Rahardi Ramelan.
Chi said his company was not affected by the May riots because all his 23,000 workers guarded the factory. But many foreign buyers were now hesitating about coming to Indonesia because of the unstable situation.
Some of the CEOs also asked for more economic incentives.
S.A. Issenmann, president of Nestle Indonesia proposed cuts in import duties for raw materials, especially for milk products.
Sri said people had been complaining at the soaring prices of Unilever products, particularly detergents, soaps and toothpastes.
She said that Unilever had continued its normal production levels but shortages had developed nevertheless because some of the products were being smuggled to neighboring Singapore and Malaysia by people to take advantage of the higher prices there.
Habibie promised to look into their complaints and suggestions, including lower import tariffs. He said he would do his best to cultivate a more favorable investment climate.
"We are a team here. We're all presidents, I am president of 202 million people and you are the president of your companies," said Habibie.
Rahardi told reporters later that the government would seriously consider all those proposals and acknowledged that the government should give more facilities to downstream industries.
"We will give greater (priority) to developing and protecting exporters. But this problem needs to be discussed further with the director-general of tax," he said. (prb)