Foreign firms not deterred by riots

Foreign firms not deterred by riots

SURABAYA (JP): Despite last weekend's major rioting in
Jakarta, foreign businesspeople seem unconcerned about making new
business deals with Indonesian partners.

Executives of eight U.S. companies, all from Minnesota, have
been seeking new business relationships in East Java for the last
two days.

"Indonesia has always had stability. We believe this will
resolve soon. It doesn't influence our mission," said Henry
Florentius, the Asia Trade Representative of the Minnesota Trade
Office, who brought the Minnesota businesspeople here.

Violent riots rocked Jakarta last weekend, killing three
people, injuring over 20 and causing widespread damages to
property, including the burning and stoning of 22 buildings,
official figures said.

Florentius noted that such riots are commonplace at pre-
election time in any country.

Guy W. Miller, president of Encore Technologies, shared
Florentius's view, saying that the riots would not discourage
U.S. firms to seek business opportunities in Indonesia,
considering its huge market size.

"Yes, we are concerned about what's happening. But we see it
as an internal matter and we feel confident that we are not the
targets," Miller told The Jakarta Post here yesterday.

At a separate occasion, Gannet Pontjowinoto, head of PT
Surveyor Indonesia's Singapore branch, said that currently,
businesses in Singapore are taking a wait and see attitude
following the riots.

"It is true that they take a closer look now. But after
everything is settled, then they will come here again because
Indonesia is their market," Gannet told the Post.

The government has hoped that the riots will not significantly
discourage foreign investment from coming to Indonesia,
considering that the country's economic fundamentals remain
sound.

"We hope the impact will be rather negligible because things
like this occur everywhere," said State Minister of Investment
Sanyoto Sastrowardoyo.

State Minister of National Development Planning Ginandjar
Kartasasmita added that there will be no significant increase in
Indonesia's country risk rating despite the recent riots.

"Risk rating depends on various factors ... but I do not see
it increasing significantly even in the near term," Ginandjar
said. "I think the security people have handled the riots wisely
and effectively."

Ginandjar acknowledged that the riots would still have short-
term impact on the country's investment.

The most telling damage of the riots on investors confidence
was the drop on the Jakarta Stock Exchange (JSX), when panic
selling hit the market on Monday and Tuesday.

Foreign investors remained absent for most of the week but
returned later in the week to cash in on cheap stocks. The JSX
composite index rebounded yesterday to 560.96 from 548.93
Thursday. (27/rid)

Confidence -- Page 10

JSX -- Page 11