Jetro promotes Japan investment in Indonesia

Jetro promotes Japan investment in Indonesia

JAKARTA (JP): The Japan External Trade Organization (Jetro)
will send three investment missions here during the remainder of
this year in order to boost Japan's direct investments in
Indonesia.

Masanori Osumi, chairman of Jetro's Jakarta office, said
yesterday that the delegations would consist mainly of those who
really want to expand their businesses into Indonesia.

"To encourage Japanese investors to come here is part of our
jobs. So, it's in our benefits also to help the Indonesian
government promote the country's investment projects to Japanese
companies," Osumi said at a gathering with local journalists.

He said that Jetro would be the sole organizer of one of the
three missions, while the other two would be organized by Jetro
in cooperation with the Japan Overseas Development Cooperation.

To attract more Japanese investors, Osumi suggested that the
Indonesian government further improve the country's business
climate. "Without demeaning last May's deregulation package, I
think the government still needs to further improve the country's
business climate," he said.

The deregulation package, announced on May 23, lowers import
tariffs on 6,030 items and removes restrictions on the
importation of 81 items.

According to Jetro's survey of Japanese-affiliated
manufacturers in the Association of Southeast Asian Nations,
problems with customs procedures, bureaucracy, taxation, wage
increases and violent exchange rate fluctuations plague Japanese
affiliates in Indonesia.

The survey, whose results were released last month, was
conducted last November and December with 282 respondents from
Thailand, 254 from Malaysia, 174 from Indonesia, 141 from
Singapore and 80 from the Philippines.

Of the total respondents from Indonesia, 84 (48.3 percent)
said that their reason for establishing operations in Indonesia
was to seek access to information on certain industries or
markets, 18 (10.3) said they were here to set up an export
production base for a third country, 17 said they were attracted
by lower labor costs, 17 said they were responding to the
appreciation of the yen and the other 16 said they were here at
the request of assemblers in Japan.

According to a report prepared by the Japanese Ministry of
Finance, quoted by Jetro, Indonesia is Japan's largest
commutative investment destination in Asia since 1952, with 2,374
projects worth US$16.98 billion.

In addition to boosting Japan's investments here, Osumi said
that Jetro was also helping the Indonesian government in its
efforts to expand exports to Japan.

He said Indonesia's exporters, especially those who do not
have agents in Japan, should use Japan's business support centers
to promote their products in Japan.

"The centers are not yet well known among Indonesian traders.
Maybe, they don't know that they can use the facilities free of
charge for two weeks to two months," Osumi said, adding that
there are only four or five Indonesian traders used the centers
each year.

The business centers are currently located in Japan's five
cities -- Nagoya, Kobe, Osaka, Tokyo and Yokohama.

Osumi said that Jetro could also send Japanese experts to
Indonesian companies which needed them. To date, Jetro has sent
over 100 experts to Indonesia. (rid)