German-Indonesian business ties shining despite crisis
German-Indonesian business ties shining despite crisis
The German business engagement in Indonesia looks back on a
long and proud history, some German firms have been active in
Indonesia for more than 100 years. Today, more than 150 German
firms are present in Indonesia.
Accumulated German direct investment to Indonesia is
approximately Deutschmark (DM) 2 billion, and is concentrated
mainly in the fields of telecommunications, metal works,
pharmaceuticals, chemical products and power plants.
Despite the dramatic business slow-down in Indonesia since
1997, no German firm active here has decided to pull out of
Indonesia, a clear sign that they still consider Indonesia a
promising business location for the future.
Some German firms even took the opportunity to increase their
economic engagement in Indonesia in recent months.
The volume of bilateral trade between Germany and Indonesia
has also been severely affected by krismon (the monetary crisis),
with German exports to Indonesia showing a much sharper decrease
than Indonesian exports to Germany; the year-on-year figures for
1997/1998 indicate a 35.9 percent decrease of German exports to
Indonesia and only a 3 percent decrease of German imports from
Indonesia.
In 1998, Germany exported goods to the value of DM 3,339
billion to Indonesia (mainly machines, electrotechnical products,
ships and chemical products), and imported goods to the value of
DM 3,957 billion (mainly clothes, electrotechnical products,
coffee, fats and plant oils), resulting, for the first time, in a
trade deficit in favor of Indonesia to the tune of DM 618
million.
To the German trade deficit with Indonesia must be added the
expenses by an approximately 150,000 Germans traveling to and in
Indonesia every year. It is expected that tourism will become an
even more important factor in German-Indonesian business
relations, creating revenue for Indonesia of about DM 200 million
per year. To underline this point, figures for Bali from the
first half of 1999 already show a promising increase of the
number of German tourists compared to 1998.