Goldstein calls on investors to stay

Goldstein calls on investors to stay

Robert S. Finnegan
The Jakarta Post
Jakarta

Businessman Harvey Goldstein is a 30-year veteran of successful
business operations in Indonesia. Among other posts, he has also
served as President of the American Chamber of Commerce in
Indonesia, Vice Chairman of the Indonesian Chamber of Commerce
and Industry U.S. Committee (KIKAS) and Chairman of the Asia
Pacific Council of American Chambers of Commerce (APCAC). He is
currently President Director of PT Harvest International
Indonesia.

Question: What kind of impact do you anticipate for the
Indonesian economy as a whole and the Bali economy specifically
from the terrorist bombing in Kuta?

Answer: In the short term it will be extremely difficult.
This sad event has played across the world and Indonesia has
probably never received so much press, and that combined with
some of the Western and Asian embassies advising their nationals
to avoid travel to Indonesia and Bali has a chilling effect.
However, I do believe that Bali has some intrinsic value and
beauty and the people themselves like all Indonesians are very
resilient. In fact, this may be looked upon as a new beginning
for Bali and for Indonesia.

In the aftermath of this attack Indonesia has had to do some
very difficult introspection and admit that there are some
serious problems here. So among the businesspeople who are
committed here we believe that out of the ashes of Bali will
emerge a newer and stronger Indonesia.

Obviously perceptions have changed. What stands out?

One of the problems we are facing is fear, insecurity. And
these emotions are easily ignited in foreigners visiting
Indonesia. This is not a problem however, with the people who are
committed and have investments here. The boardrooms and stock
exchanges across the world though are not always impacted by the
personal feelings of these committed individuals; it's more the
perception of the major investors who take a certain position on
Indonesia that may have a certain impact in terms of sentiment.
So there is a short-term impact. We all know that the world is a
less secure place after the WTC tragedy. But look at what
happened in New York, there was no one in the U.S. government who
said "let's get out of New York", in fact it was just the
opposite.

There have been conflicting statements issued by Western
embassies with regard to safety issues for foreign nationals.
What do you think is happening here?

American diplomats and the State Department in particular are
bound by regulations and laws that require them to give advice to
citizens, the same advise that they take. So basically if they
are told to scale back they have to advise other Americans to
scale back as well. I believe that law came into effect after the
Lockerbie attack where there were some accusations the U.S.
government was withholding information. So we sometimes find that
the advice they receive is somewhat dramatic and too
conservative. The American ambassador has done a very good job,
his heart and mind are in the right place, but he is balancing a
lot of factors.

Not only is he required to look out for the safety of his
people; he also has to respond to Washington. There is a lot of
intelligence he has to filter and if he sits on any of it there
could be a problem.

What is the sentiment here among the local businesspeople?

We don't find large groups of businesspeople pulling out of
Indonesia. People who are doing business here want to find a way
to continue to do business here, but personal safety is a factor
and everyone has a different level of risk taking. It is all
these immediate reactions that are an impediment to the natural
flow of business and if you multiply that out you will see that
there will be some constrictions and that is unfortunate.

How is the Jakarta Stock Exchange looking?

Indonesia is still susceptible to other shocks. The government
is taking concrete steps now to address the terrorist threat here
and I think that the stability of the market, even though it has
taken a hit reflects these efforts.

Is it enough?

What the international community needs to understand is that
the Indonesian government is taking prudent steps, reacting
swiftly -- which they are doing now -- to combat the threat. They
are organizing themselves to take appropriate action. When the
international community sees this they will be better prepared
not to react emotionally or with shock in the face of further
threats.

Has new investment been impacted by the Bali attack?

New investment coming in has almost been frozen at this point.
However, expanded investment in the natural resource sector is
not. Oil and gas, hard rock mining, those companies are committed
and continuing to expand. Everything is going on as normal but
the people in Illinois or Indiana don't know this and they think
Indonesia is a war zone. Every day there are crimes and riots in
the United States -- look at the sniper on the loose now -- and
people aren't canceling plans to visit the U.S. because of this.
And that's the sad thing about this myopic syndrome of people
only seeing the negative side of Indonesia.

This is not the only terrorist attack that has taken place in
the world. There are terrorist attacks in the Middle East, the
United States. So we have to put all this into perspective. All
these places where there are terrorist attacks -- we don't just
cross them off as destinations.

We also have to put the efforts of the Indonesian government
in the proper light.They have taken tremendous strides in
combating terrorism, and the fact that there is 99 percent
normalcy in business and social activities needs to be
acknowledged.

What role do you see the international media playing in
influencing foreign investment at this point?

The media has consistently played more toward the dramatic
rather than the quiet business negotiations and expansions. The
media is in the business of selling news and by their coverage of
the tragedy in Bali they really captured the wrong image of
Indonesia. So the media to date has continued to negatively
impact the perception of Indonesia as a safe destination for
foreign investment and that continues to be the case as we speak.

"Is Megawati up to it?". "Why is she going to Mexico?" You
know all these questions about leadership continue to play on the
negative while there are some very positive things happening now
-- the willingness of the government to directly take on the
radical elements here, the willingness to bring military
intelligence back into the picture, the cooperation between the
military and police to protect strategic sites.

All of these actions play positively to foreign investors. No
one expects to have 100 percent security anyway, even in New
York. It's just the combination of Bali and having foreigners
targeted that is tremendous fodder for the sale of newspapers.
It's a fact that Indonesia continues to be a moderate Islamic
country and is still a safer place than New York. This somehow
escapes the international press. It's the CNN syndrome, where
everything is burning.

How about a forecast for the future of foreign investment?

The next six months to a year is going to be very difficult,
depending on what happens of course. I am assuming that we are
going to experience more terrorist attacks, so it all depends on
how the government reacts to it. When I was in New York after the
WTC attack, of course it was different but I was not afraid to go
to New York because I knew that the government had taken action
and I think that people have to look at Indonesia in the same
light.

People are very angry at what happened in Bali, no one has
even claimed responsibility for this attack, so that shows you
how much popular support it had.

And on the positive side?

I think that all over Indonesia we have committed foreigners
who each in their own way has a positive story to tell and they
can act as honorary ambassadors to Indonesia by sharing what is
happening to their company during these times. They can go out
and tell other businesses, other foreign investors, the
government and the press about the positive things happening in
Indonesia.

We have an obligation not to yell fire in a crowded movie
theater, and the press has an obligation to balance the story --
apply objectivity. This in itself would be a positive
development. We have here in Indonesia a "United Nations" of
investors and we can harness these people, make them our honorary
ambassadors to put out the truth about our country. These are
the people that can do it.

What would you personally say to foreign investors who are
contemplating opening or already own a business here in
Indonesia?

I would say come, invest in Indonesia. There is less chance of
being hurt here than flying into New York. I would say that your
existing business here depends on you providing an example for
others, that Indonesia is a good place to do business. So Mr.
CEO, who has a good business here in Indonesia, come on in to
Jakarta today to be photographed with us. Give an endorsement to
Indonesia, because you are making money for Indonesia. Come on
down to Jakarta as a CEO, to help us -- attend a Chamber meeting,
a press conference -- stand up and be counted. That would be a
great help to us all.