Kalla expects strong growth next year

MAKASSAR, South Sulawesi (JP): The newly appointed Minister of Trade and Industry Jusuf Kalla, said he was upbeat that Indonesian's economy would be more stable next year.

He attributed his optimism to the recent significant improvement in Indonesia's social, security and political situations.

"I believe Indonesia's economy will be more stable next year ... The establishment of the new government under Gus Dur (President Abdurrahman Wahid) has resulted in the recovery of the country's social and political conditions," he told The Jakarta Post over the weekend.

He was also optimistic that foreign investors and traders, who were previously worried about conducting businesses in Indonesia due to such uncertainty, would soon reenter the country.

Kalla acknowledged that it would take years to bring the country's economy, which has been hit by crisis since late 1997, back to its pre-crisis level.

But he added that the recovery process could be speeded up if the new government was able to appropriate policies in dealing with the crisis.

In order to accelerate the country's economic growth, his office has begun to establish business contacts with Indonesia's main trade partners such as Japan, Taiwan and the United States.

The ministry had also conducted intensive discussions with local and international business players as well as the regional banking industry and the World Bank, he said.

Kalla met the World Bank's director for Asia Pacific Hubert Neiss during the latter's visit to Indonesia last week.

Kalla, a renowned native businessman himself, also predicted the country's trade and industry would be able to register stronger growth next year following the impact of the improvement of people's buying power.

"I see some factories have resumed their production activities in response to an increase in demand," he said.

Not all of the country's economic sectors were frail, he said, adding that several sectors, such as agriculture, were not affected by the crisis and thus continued to record good growth.

When asked about the government's plan to open trade relationships with Israel, Kalla asserted that it was never meant to deflate Indonesia's good relationship with Palestine.

"It will only be a trade cooperation, not a diplomatic relationship. The trade cooperation with Israel would be no different from that with China or Taiwan," he added. (27/cst)