Many planned investments in Jakarta relocated

Many planned investments in Jakarta relocated

JAKARTA (JP): About 40 percent of planned investments and
expansion projects in Jakarta have been canceled and relocated to
other provinces due to limited industrial land sites, an official
said.

The chairman of Jakarta's Investment Coordinating Board
(BKPMD), Ery Chajaridipura, told a workshop yesterday that most
of the planned investments and expansion projects have been
relocated to West Java, particularly the Tangerang and Bekasi
regencies, where there are already industrial estates and sound
infrastructure facilities.

"If (Jakarta) manages to get 80 percent of the planned
investments and expansion projects, it is already a good job,"
Ery told the meeting.

The one-day workshop -- held jointly by the Investment
Coordinating Board (BKPM), BKPMD and PT Sucofindo Masterlist
Verification Division -- discussed the procedures for submitting
the master lists of capital goods and raw materials needed to
register projects using the fiscal facilities provided by BKPM.

Ery said that so far, none of the canceling investors have
relocated their projects overseas.

"We will not mind if they relocate their projects to other
provinces, but it would really become a concern if they started
thinking about going to another country," he said.

Commenting on the business climate in Jakarta, Ery
acknowledged that his office lacks sound information and needs
plenty of input from investors here.

Without accurate information from the private sector, he said,
the local administration will be unable to identify the problems
the businesses face.

"How can we know when an investor has a problem if the
investor doesn't tell us? If the business can't be expanded due
to limited space, for example, we will give information on the
provinces to which it can be relocated," Ery said.

Nonetheless, he acknowledged that the biggest problems that
most businesses are likely to complain about are the lengthy
trade and investment procedures that lead to high costs.

He urged businessmen and investors to refrain from engaging in
practices that may encourage these high costs. Such practices
include bribing government officials to speed up or cut short
registering procedures.

"Of course, government officials should be the first ones to
stop such practices. But businessmen and investors should also
discourage them," he said.

BKPM Secretary Mochtar Ollong said in his opening speech at
yesterday's workshop that during the period between 1967 and
Sept. 15, 1996, domestic investment approvals in Jakarta reached
1,648 projects with a total value of Rp 55.3 trillion (US$23.6
billion at current rate), while foreign investment approvals
reached 1,350 projects worth $24.2 billion.

Indonesia started implementing its law on foreign investment
in 1967.

For this year alone, as of Sept. 15, domestic investment
approvals in the city reached 158 projects worth Rp 12.8
trillion, while foreign investment approvals totaled 265 projects
valued at $2.9 billion.

Mochtar said the number and value of Jakarta-based investments
are below that of West Java. He attributed this to the limited
industrial land sites in the city.

"Therefore, additional investments in the primary and
secondary sectors are now very limited in Jakarta. The city now
relies more on the tertiary, or services, sector," he said. (pwn)