Foreign investors in Indonesian banks

Foreign investors in Indonesian banks

The latest government plan is to allow foreign investors to
control more than 51 percent of shares -- possibly even up to as
much as 99 percent -- in Indonesian banks. The reasoning behind
the plan is that this country very much needs foreign
participation in order to revive its banking sector as well as
its economy as a whole.

Considering the reality that our national banking sector is a
shambles, the benefits that are being offered to foreign
investors make sense. Our banking sector, which is, at present,
undergoing a complete overhaul, needs money, relief efforts and
credibility. The admission of foreign capital will hopefully
restore this sector, and this would unquestionably have a most
positive effect on our national economy.

Although we are now in a cornered position, we hope the plan
to give foreign investors a bigger portion will be given careful
advance consideration. This involves, especially, the degree to
which foreign banks can contribute to our national development
efforts. The fact is that the presence of foreign banks has,
apart from a positive position, also a negative side. This is
because their interests are not always in harmony with ours.

Our position is that however much we are pressed for time,
openings must be found to give our own domestic entrepreneurs the
opportunity. We must not offer all our economic sectors to
foreigners.

-- Bisnis Indonesia, Jakarta