Wed, 08 Dec 2010


By Karim Raslan, The Star
Indonesia is on the verge of an economic take-off, powered by its huge markets and abundant natural resources.

What’s remarkable is that this paradigm shift has been effected largely through the republic’s political transformation from centralised authoritarianism to today’s decentralised democracy.

I realised this when I recently returned to Palembang, Sumatra’s second largest city with a population of over 1.5 million.

Once a centre for both trade and learning as the capital of the mighty Srivijayan Empire, its modern descendant is now experiencing a mini-boom of its own.

Shopping malls, housing estates and industrial centres are rising on both sides of the broad and sluggish Musi River. Infrastructure is improving as Palembang will host the 2011 SEA Games.

Slowly but steadily, the city is re-emerging on the national stage, reversing its long decline.

This progress has been aided by the relative prominence of locally-born national leaders including PDIP leader Taufik Kiemas, husband of Megawati Soekarnoputri, coordinating minister of economics Hatta Radjasa and DPR Speaker Marzuki Ali.

Palembang also serves as a major regional hub: a retail and entertainment centre for the prosperous province of south Sumatra and its eight million-strong population, not to mention visitors from as far as Jambi and Lampung.

This ancient city is obviously going places, and this was apparent at a conference on entrepreneurialism which I attended at the invitation of Mayor Pak Eddie Santana.

This event was anything but tedious - I found myself taking copious notes throughout.

For a start, the invited speakers were obviously leaders in their fields.

It was truly impressive how a second-tier city like Palembang could attract such heavy-hitters men such as Dahlan Iskan, the PLN CEO, Forbes cover-boy and billionaire broadcaster-banker Chairul Tanjung, Lippo Group’s James Riady and the ever dignified property magnate Ciputra.

At the same time, the audience reactions also piqued my curiosity.

Over a thousand people showed up, a phenomenal turn-out considering that the cheapest seats started at 300,000 rupiah (US$33).

There’s always a risk that events like this are dreadfully boring because corporate figures are often uninspiring speakers.

This was certainly not the case in Palembang.

The first speaker after the ever-smiling Pak Eddie was the ebullient and gym-shoe wearing Dahlan Iskan. Pak Dahlan with his piercing tenor voice, bounded across the stage like a teenager, punching the air in his enthusiasm during his slot.

His presentation was simple yet energetic, stoking the level of excitement in the hall.

His message was tried and true but nonetheless effective. He called on the listeners to move, to trust their instincts, to stay focused.

More importantly, they had to continue even after they’d experienced the requisite failure.

Pak Dahlan’s prep talk comes from the school of hard knocks. Having created a network of over two hundred daily newspapers stretching from Aceh to Papua, you can feel the same determination that once powered his business empire.

Indeed, he ended his session with a typically Dahlan-esque flourish, telling everyone that this should be their last seminar; advising them to get back to work!

The media and retail tycoon Pak Chairul (a major shareholder in Carrefour Indonesia) was entirely different.

He was less effusive but just as compelling.

As the head of the National Economic Committee and a close confidant of the President, Pak Chairul spoke with certainty and confidence.

He was sonorous, firm and reassuring laying out the numbers behind the republic’s current boom.

The audience fell silent as he spoke, digesting the figures and the key thrust of his presentation: Indonesia has a spectacular future, its problems with bureaucratic reforms and human resource limitations notwithstanding.

The sense of anticipation and excitement in the hall was electric as he made his conclusions.

However, this being Indonesia, the questions from the floor that followed were aggressive.

Many called on the nation’s tycoons not to dominate all available businesses.

One got a sense that such sentiments are not limited to Palembang alone.

Indeed as the conference came to a close, I realised that Palembang’s rise reflects the way in which the republic’s prosperity is inexorably spreading outside of Jakarta and Java.

Decentralisation has unleashed the energies and ambitions of the millions across the republic. By 2015, Indonesia’s economy is expected to hit the $1 trillion mark, by which stage it may well be three times the size of Malaysia’s.

There is still time for Malaysian businesses to move into the republic. Sure, the marketplace is aggressive and competitive, but that’s life.

As I’ve said again and again, our future lies beyond our borders, and Indonesia is definitely the first stop.