Hassle-free environment key to Batam's success

Hassle-free environment key to Batam's success

By Riyadi

BATAM, Riau (JP): Hassle-free trading and investment in Batam
has resulted in miracle economic growth on the island, Minister
of Industry Tunky Ariwibowo said yesterday.

"The success of Batam Island lies in what I call its hassle-
free operation: that is, a freer movement of people, goods and
services to and from Batam," Tunky told local and foreign
journalists after inaugurating a computer hard-disk drive plant
owned by PT Quantum Peripherals Indonesia.

The minister said that the success of Batam as one of
Indonesia's economic growth centers was also due to its well-
managed industrial estates.

Batam, designated a special economic bonded zone and receiving
special support from the governments of Indonesia and Singapore,
has attracted private investments of over US$4 billion.

According to official figures, the total value of exports from
the island increased by 50 percent last year, to $1.39 billion.
Eighty-two percent of that total came from the export of
electronic products.

Also speaking at the inauguration, Philip Yeo, chairman of the
Singapore Economic Development Board, said that the Batamindo
Industrial Park (BIP) alone had contributed $700 million to last
year's exports.

Over 100 companies are currently operating on the island, with
another 70 enterprises at various stages of construction or
awaiting government approval to commence.

Of the fully-operational companies, 57 are located in the BIP,
which is managed by PT Batamindo Investment Corporation, a joint
venture made up of the Salim Group of Indonesia, the Singapore
Technologies Industrial Corporation and Jurong Environmental
Engineering of Singapore. More than 34,000 workers are employed
in the BIP.

Asked about the decision of a number of foreign companies to
leave the BIP for other industrial estates abroad, Tunky said the
problem might stem from the stiffer competition among countries
in the region to attract foreign investment.

Helping hand

Minister Tunky promised that the government would extend a
helping hand to solve the problem.

He also said that the government would be helping other
industrial estates in the country to improve their performance,
including those in the Greater Jakarta area; in Surabaya, East
Java; in Ujungpandang, South Sulawesi; and Medan, North Sumatra,
in order to attract more foreign investors.

Tunky said that his office planned to take a number of
deregulatory measures this year to attract more foreign
investment.

The purpose of deregulation was to improve efficiency and
reduce production costs, the minister said.

When asked which sectors would be affected by the coming
deregulation, Tunky declined to reveal this, saying that the
Ministry of Industry was still collecting and evaluating data on
every relevant sector.