Sat, 29 Oct 1994

Hayono for govt policy on business development

JAKARTA (JP): Minister of Youth Affairs and Sports Hayono Isman says those who criticize President Soeharto for being too generous and helpful to the country's magnates of Chinese descent, should look back to the period of economic breakdown that Indonesia suffered during the latter half of the sixties.

At the time, business opportunity was equally open to both indigenous Indonesian citizens and those of Chinese origin, but it was the Chinese who were quick to grab the opportunity and they proved more skillful in running the business, Hayono said.

Hayono spoke at his office on Tuesday where he received 18 entrepeneurial youths from Kalimantan, Sumatra, Java and Sulawesi responsible for pioneering new businesses in their villages.

President Soeharto was clever enough to use the Chinese to build economic strength, Hayono said. Had he, for instance, opted for village cooperatives rather than capitalizing on the business acumen of the Chinese, Indonesia's economic development would not be like it is today, Hayono added.

This does not mean that the government currently belittles the role of cooperatives or is not interested in creating a conducive climate for the development of cooperatives, Hayono said..

He said that in the 1950s and '60s state-owned companies were full of civil servants who knew little about businesses or cooperatives. The majority were home to people preoccupied with politics and so the option went to the Chinese, he added.

To be fair, the government has given opportunities to many native businessmen to run forest concessions, but most of them have ended up subcontracting their licenses to their Chinese counterparts, Hayono said.

According to Hayono, this shows that they were not disposed to running businesses. In the first half of the century, the option of becoming a businessman was not popular as most native Indonesians preferred to become civil servants.

This climate was deliberately conditioned by the Dutch colonial government to prevent native Indonesians from becoming economically strong and from posing a threat to the Dutch.

At the time, the Chinese community in Indonesia was relatively small and their economic success would not have threatened the Dutch colonialists, Hayono said.

Because the Chinese are more apt and able in business matters, they have made considerable progress economically, resulting in a wide economic gap between native Indonesians and their fellow Chinese countrymen, Hayono said.

The gap is the result of a natural course of history. Hayono said that his office is now trying to minimize the gap. A plan to set up a national entrepreneurship body to which small-scale, self-starter entrepreneurs can turn for help is underway. Hopefully, President Soeharto will approve the plan, he added.

Hayono said Chinese conglomerates have promised to help develop the body which will focus on developing native young Indonesian entrepreneurs into larger conglomerates.

"We need many indigenous conglomerates to strengthen our middle-class society," Hayono said.

Hayono acknowledged that some Chinese businessmen might have amassed their wealth by violating laws -- as in the Rp 1.3 trillion (US$620 million) scam of the state-owned Bank Pembangunan Indonesia (Bapindo) which involves Chinese businessman Eddy Tansil -- but that by no means are all Chinese businessmen corrupt. (arf)