Indonesia still attractive for foreign investment

Indonesia still attractive for foreign investment

JAKARTA (JP): Indonesia has the potential to become the most
attractive country for foreign investment, said Chairman of
Harvest International Inc. Harvey Goldstein.

Goldstein told a two-day seminar on joint ventures, which
ended yesterday, that Indonesia's single-digit inflation and 18
major deregulation policy packages released since 1982 offer
advantages to foreign investors.

In spite of the labor riots which occurred in Medan, North
Sumatra last week, Goldstein cited Indonesia's low labor wages,
political stability and large consumer market as factors which
make Indonesia attractive for foreign investment.

However, Goldstein said several shortcomings remain to hamper
foreign investment in Indonesia, such as the divestiture laws
(Pakto 1993) which require divestment to minority shareholders
within 20 years of initial operation, weak human resource
development and monopolistic practices by various strategic
sectors.

He added that special treatment of elite businessmen, non-
transparent investment regulations and land title rules are some
impediments to foreign investment in Indonesia.

Indonesia needs to refocus its economic and investment
policies and allow greater domestic market access to foreign
investors due to increased competition from other Asian
countries. (03)