Kadin prepares business guidelines

Kadin prepares business guidelines

Rendi A. Witular, Jakarta

The Indonesian Chamber of Commerce and Trade (Kadin) is
currently drafting a comprehensive five-year business guideline
for the upcoming new administration to resolve various protracted
problems currently faced by the business community.

The road map, which is being formulated by Kadin's Indonesian
Economic Recovery Committee (KPEN) along with local and foreign
business associations, is expected to improve the relationship
between the government, the business community and the public.

Former Kadin chairman Aburizal Bakrie told The Jakarta Post on
Wednesday that the road map was aimed at putting business sectors
on the right track of development and ensuring that they would
not lose direction in the future.

"There is a need to set up clear guidelines for businesses.
The road map should be agreed upon by the government, the public
and businessmen so that there will be no rifts between them in
the future," said Aburizal, who is now the chamber's senior
executive member.

Aburizal explained that currently there were so many conflicts
hampering businesses due to the absence of clear guidelines. The
conflicts include disputes in the steel industry between upstream
and downstream players, and the rift between the Ministry of
Energy and Mineral Resources and the Ministry of Forestry over
mining in protected forests.

Another problem, according to Bakrie, is the absence of a
clear business plan and regulations in the plantation industry,
which should have become the country's main driver of economic
growth given the abundant resources.

If the new elected government accepts the road map, which is
scheduled to be completed in September, the country will have a
strong chance of increasing its non-oil and gas export to at
least US$100 billion in 2010 as against $60 billion targeted for
this year, according to Kadin.

Although Indonesia is already in the economic recovery phase,
the nation's economic growth remains unimpressive (4.1 percent
last year, 4.1 percent predicted for this year). Analysts say
this is because the growth is largely dependent on consumption,
rather than investment and exports.

Kadin, the country's powerful business lobby group, expects
that the road map will help boost investment by the private
sector, particularly small and medium and enterprises, and expand
exports, so that both will become key drivers of economic growth
instead of consumption.

Exports have failed to emerge as a major growth engine in
Indonesia, Southeast Asia's largest economy, due to various
problems faced by the real sector, from legal uncertainty to
labor disputes, from red tape to poor implementation of regional
autonomy.

Aside from proposing guidelines, the road map will also
specify problems faced by each business sector, and the possible
solutions.

Aburizal said the business community would not press the new
government to adopt the road map. Should the new government make
a different plan from the one being made by Kadin, the business
community would consistently launch intensive criticism against
the government if it failed to revive the economy.

Earlier, Kadin's chairman Mohammad S. Hidayat called on
presidential candidates Megawati Soekarnoputri and Susilo Bambang
Yudhoyono to select as their key economic ministers those who
understand business and financial markets, rather than academics.