High costs hurt small enterprises: U.S. senator

High costs hurt small enterprises: U.S. senator

JAKARTA (JP): United States Senator Christopher Bond suggested
yesterday the Indonesian government eliminate the country's high
business costs to stimulate the growth of small enterprises.

Abolishing various "contributions" and illegal fees would be
the first step to creating a conducive atmosphere for small
entrepreneurs, Republican Senator Bond said in his address to a
luncheon held by the United States Committee of the Indonesian
Chamber of Commerce and Industry.

"The first thing the government should stop doing is creating
unnecessary burdens," he said.

Bond, the chairman of Congress' committee on small business,
attended yesterday's luncheon with Senator Bill Frist. The two
were on a three-day visit to Jakarta to meet government officials
and businesspeople.

They met President Soeharto earlier yesterday.

Bond suggested the government get small entrepreneurs together
to find out the problems they faced in business. The more input
the entrepreneurs provide, the better the government can help
them, he said.

"The businesses shouldn't be asking the government how to
produce things... The government only taxes and regulates," he
said.

"The ones who best know the business are the entrepreneurs
themselves," he said, adding that entrepreneurs would develop
best if the government sets up clear regulations and policies.

Minister of Cooperatives and Small and Enterprises Subiakto
Tjakrawerdaya, who attended the luncheon, said the government was
trying to cut back high economic costs.

"Our deregulation measures and campaigns against illegal fees
are part of our effort in that direction," Subiakto said after
the luncheon.

While acknowledging most of Bond's suggestions, he disagreed
with Bond's proposal to limit the government's role in developing
small businesses.

He said the government should be "actively involved" in
promoting small enterprises and not just content with the mere
role of taxing and regulating.

"The government has a duty to assist small businesses," he
said.

Small businesses employ more than 84 percent of the total work
force and contribute almost 38 percent to gross domestic product,
Subiakto said.

The country's 34 million or more small enterprises mostly
engage in agriculture (63.1 percent), trade (17.4 percent) and
processing industries (7.5 percent).

Almost 91 percent of small-scale entrepreneurs have no more
than an elementary education, and 9 percent have finished junior
high school.

Kirsten Edmondson, an International Republican Institute
program officer, said yesterday the Washington-based institute
was planning to launch a program to help small businesses in
Indonesia.

She told The Jakarta Post the program would involve
partnerships between the institute, the Indonesian government and
small-scale entrepreneurs.

The program would bring together American business experts,
business-association members, the Indonesian government and
small-scale entrepreneurs.

The program would focus on sharing experiences, discussing the
challenges faced by small-scale entrepreneurs and finding ways to
address them.

"The small businesses will be expected to tell what they
expect from the government... Their input will be particularly
valuable for the upcoming deregulations that the government will
be issuing next year," she said.

Edmondson said the program, to be funded by donations from
private U.S. businesses and a congressional endowment, would be
launched in January and last from three to five years. (pwn)