Indonesia risks chasing away foreign investors

V.K. Chin, The Star, Asia News Network/Selangor, Malaysia

The continued defiance of the South Sulawesi police to detain two Malaysian accountants even though they had been freed by the court, will only create more problems for Indonesia.

It will be another blot on the way things are conducted in the republic and it will further frighten away foreign investors who already have enough misgivings over corruption and red tape.

It is not that Malaysia wants the two accountants, Choo Yao Chin and Raimala Sivalingam, to be given any special treatment and if they should be suspected of committing any immigration offense, they should at least be allowed bail.

Instead, Choo and his colleague, both employees of international accounting firm KPMG, were refused bail and the former was being locked up together with hardened criminals.

Nobody is saying that the police there are not doing what is within their rights but it is just not proper for a person supposedly held for a visa offense to be placed together with criminals and other undesirable elements.

It is quite clear that something unusual is going on there and that the two Malaysians have most probably been detained to teach them or their employers a lesson for whatever reasons.

Both of them could be released on bail and they can remain in Indonesia until their case is up for hearing. Since an earlier court had already cleared them of any wrongdoing, they should be freed even if they should be brought to court again.

The police chief there knew the circumstances but he is prepared to go through the whole charade for reasons known only to himself and other involved parties in the district.

There is little or nothing that the company can do to compensate them for the ordeal they have gone through especially Choo. Unfortunately, this show of defiance may backfire badly on Indonesia.

Its leaders can introduce all the necessary legislation to attract foreign investment or to make all sorts of promises to win over overseas investors but the publicity given to the latest incident will surely turn the clock back.

If officials outside Jakarta should fail to follow the instructions and do as they like in dealing with foreign investors and professionals, then foreign businessmen will just forget about the republic for the time being and go elsewhere.

This will be a serious blow to the Indonesian economy and to the Susilo Bambang Yudhoyono administration, which is trying so hard to woo foreign investment to spur growth and to provide jobs for the tens of millions of unemployed Indonesians.

While the Indonesian president is a much respected leader by the outside world, he appears to have a tough time fighting corruption and red tape, two major curses facing any government trying to gain investors' confidence.