If we spend energy on the past, we won't move forward

If we spend energy on the past, we won't move forward

Indonesian industrialist Sukanto Tanoto is the chairman of the
Singapore-based RGM International group, a leading industrial
group, which currently runs the world's largest pulp producer,
mainly in Riau and North Sumatra. In a talk with The Jakarta
Post's Kornelius Purba on the sidelines of a seminar organized by
INSEAD Business School in Singapore over the weekend, the
businessman shared his views and feelings about Indonesia. The
following are excerpts from the interview.

Question: As a regional economic player, what is your view
about the Indonesian economy, and the fact that it has not fully
recovered from the 1997 economic crisis or that the capital that
flowed out then has yet to return?

Answer : I think there are a lot of discussions about inviting
back ex-Indonesian economic players overseas and so on. All
businesspeople, when they invest, are looking for business
opportunities. Businesspeople, like ants, are attracted to sugar.
Or they may be compared to water -- water never falls never flows
from below to above, but always from above to below. That means
that businesspeople always look for opportunities in places where
they are safe. This is the basic element.

Before the crisis (1997), we are among the biggest investors
in the country. We sold our assets. But in 2000, we brought back
almost US$1 billion to finish all our projects in Indonesia. So
there was crisis, there were big capital outflows. But we did not
announce it. In 1999, people were even talking about why we sold
our assets.

Question: Why did you come back?

Answer : We came back not because of the issue of nationality
only but because business itself requires investment, and if you
do not finish it, everything is wasted and you lay off workers.
So you must finish it. Then our business will have a better cash flow and
opportunities. That is why we invest, it is not purely a matter
of patriotism.

Many people have been working for us for many years, so we
also feel some responsibilities. Then there is the environment.
We learned the hard way how to handle this problem.

How will we improve the economy?

What is most important here is that everybody has to do their
part. Everybody ought to do what they ought to do. For 53 years
since 1945, Indonesia had only two presidents. Imagine, in the
last 7 years alone we have had four presidents: Pak Habibie, Pak
Abdurrahman Wahid, Ibu Megawati and Pak Susilo.

It is a very dynamic, changeable external environment in which
we are operating. So now, with a new government, I think the
government should do what it needs to do to improve the
situation, security, and also improve the investment climate.

How?

You need people to feel comfortable and feel secure. In what
sense? What is important here is how we move forward. Since 1998,
we have had four presidents, and all of them have had different
styles. If you look at history, what is right and what is wrong
can be different. During Soeharto's time, it was right, then
under Pak Wahid it was wrong. And under Pak Susilo, perhaps it is
not wrong anymore.

If you continue going along with this trend, you will spend a
lot of time and energy on the past. Now we must move forward.
Indonesia does not stand alone. We are part of the 10-member
ASEAN. We are also facing head-to-head competition with China and
India. We need to move forward.

So, if we spend a lot of energy on the past, we won't be able
to move forward as people will keep on fighting each other. It is
OK to have different opinions, but this is a process. For
example, the media is now open, but they need to use their
freedom in responsible ways. The government needs to move forward
to create a good investment climate where people feel secure.

All businesses are now in a difficult situation -- oil prices
are going up, and this has affected costs, and we will have to deal
with these. We must try to improve things, try to work well, and
we must try to move forward. But if people continue fighting each
other and try to find scapegoats and then raise issues, either
positive or negative, but out of proportion, then businesspeople
will start to think that because of the high oil prices we can't
work and so on, ask for more protection, and then there it is. I
call this a downward spiral.

Look our situation now. There is conflict over textiles
between China, and the EU. And U.S., European and American
customers also want to diversify their supply away from China.
And Indonesia can use this opportunity. Look at the Blue Ocean
Strategy. China needs a lot of palm oil, energy, coal, all mining
products. We are producers.

Question: How about macroeconomic problems?

If you go to China, to India, Singapore or, even, Malaysia,
they still give tax holidays. Look at what China is doing, they
are pro-business. They provide a lot of incentives and encourage
more people to come. If you go to invest in China, they treat you
like VVIP. You get police escort.

Question: How about Indonesia?

You and me both know about that, I don't want to talk much
about that. In China, you get a license very quickly. Not only in
China but in all the other neighboring countries. I have no
investments in Vietnam, but I've heard it is better than
Indonesia. It is unbelievable. I feel bad for my country. But we
still have a chance. We must work together, the government,
business, the media, on how we can grow our economy.

Deng Xiao Ping said, "I don't care whether it is a white cat
or black cat. As long as it can catch a mouse it is a good cat."

How about law enforcement? Do you think you are treated like
scapegoats?

I think it is not only law enforcement. It is also the
public's general perception, through the media, in looking at
conglomerates. There are good and bad conglomerates. You are
branded sometimes without clear evidence.

Question: How will you handle the highly controversial
Indorayon pulp and paper plant?

We have a new mind-set. We understand now that it is better to
have communications with communities and so on. In the past, you
got the license, you worked based on the government permit, then
you didn't care about the others because you were legal.

But what we have now learned is the need for communication.
Overtime, we will be able to improve our skills in this regard.
Now we are very aware of it.