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.