Indonesian firms urged to invest more overseas

Indonesian firms urged to invest more overseas

JAKARTA (JP): Christianto Wibisono, the chairman of the
Indonesian Business Data Center, urged yesterday Indonesian
businessmen to invest abroad.

Christianto said claims that investing abroad caused capital
flights should not discourage investment overseas.

He said direct investment abroad, including in industrialized
nations, was important because Indonesia had to catch up with
other Asian investors.

"It is now time to see that investing abroad is part of the
efforts of improving our economic performance," he said while
commenting on the United Nations conference on Trade and
Development's (UNCTAD) annual investment reports.

"How can our companies become global economic players if we
discourage them by saying that investing will cause capital
flight?" he said.

He cited Hong Kong, Taiwan and South Korea as nations that
were increasing their investments abroad, particularly in Europe.

UNCTAD released a new report on Asian investment yesterday
titled Sharing Asia's Dynamism: Asian Direct Investment in the
European Union.

The report did not mention Indonesian companies' foreign
companies although many had made significant investments abroad.

"I don't know why this report misses them. Perhaps it is
because the Indonesian companies keep a low profile because they
are scared of being accused of causing capital flight at home,"
he said.

He said Texmaco Group had set up a textile plant in Northern
Ireland, Gemala Group a storage battery plant in England, while
Salim Group had bought a trading house company in the
Netherlands.

He said they used foreign countries' financial facilities and
were smart not to take funds from Indonesia.

"They can always rely on the international funding system that
has become very sophisticated," he said.

The report said foreign direct investment (FDI) from
developing Asian countries to Europe rose from an average of
US$100 million between 1989 and 1991 to an average of $860
million between 1992 and 1994.

While North America remains their investment location beyond
Asia, their activities in Europe have gathered momentum, both in
manufacturing and services.

At least three of the new industrialized economies -- Hong
Kong, South Korea, and Taiwan -- are now net outward investors,
the report said.

China and several Southeast Asian Economies, have become
countries with large outward FDI but were not yet net outward
investors. (bnt)