Kwik says time needed to put business in order

Kwik says time needed to put business in order

JAKARTA (JP): Indonesia still needs a longer period of time to
be able to implement a sound business competition policy in an
economy long dominated by a handful of powerful conglomerates,
according to Coordinating Minister for Economy, Finance and
Industry Kwik Kian Gie.

Kwik said on Monday that the essence of a competition policy
was still new even to well-educated Indonesians, including
economists and businessmen.

"There are many who still question why we have to impose
limitations on market shares. So we still need a longer period of
time to be able to implement it perfectly," he said after opening
a conference on competition policy.

But Kwik stressed that the government strongly believed that
effective implementation of a competition policy was vital to the
country's economic growth.

Kwik said that the House of Representatives was in the process
of selecting members of a new powerful Business Competition
Oversight Commission to oversee the implementation of the
country's new anti-monopoly law.

"The Commission must perform its functions wisely and
transparently. The challenge is to make that this will happen,"
he said.

"The law cannot cover every aspect because of fast changes
occurring in the business world. The interpretations of the law
will depend on the commission," he added.

Meanwhile, World Bank country director in Indonesia Mark Baird
said that it was important for Indonesia to implement a business
competition policy in order to restore investor confidence and
revive investment flows.

"This can only be achieved by promoting private sector
development through open, flexible, and adaptable competitive
markets, encouraging a more sustainable growth pattern that is
much less vulnerable to (economic) crisis," he said at the
conference.

Baird said that the growth of monopoly and oligopoly power in
recent years was a key underlying cause of the country's current
economic crisis.

"In the case of Indonesia, their dominance in many instances
was supported by government policies and regulations that accord
them market power and protect them from competition," he said.

Kwik, however, said that Indonesia wanted to implement the new
competition policy in the right way.

"I'm convinced that faulty implementation of our new
competition law could set Indonesia's economic reform efforts
back. It is important that we do it right," he said.

He pointed out that there was a temptation to see the new
competition policy as an opportunity to redress the inequities of
the previous industrial structure by granting privileges to those
who were once unfairly denied commercial opportunities.

"That would be a mistake. Our competition policy should not
seek to redress the wrongs of the past, but to redesign the
system so that future industrial and economic growth derives not
from undue privileges seized by a business, but from dynamic,
efficient and fair competition," he said.(rei)