M^MRI prepares new law to draw more investments

M^MRI prepares new law to draw more investments

Agencies Tokyo

Indonesia is eying new legislation to provide foreign investors with greater incentives, such as relaxed regulations and an improved legal system, in order to attract more Japanese investment, a senior Indonesian official said on Wednesday in Tokyo.

Theo Toemion, chairman of Indonesia's Investment Coordinating Board (BKPM), said the Indonesian government would send to parliament by December a draft investment law that would improve the country's investment climate, including a streamlined regulatory framework and enhanced industrial competitiveness.

Our economic growth depends heavily on new investment and increases in exports," Theo told a meeting with Japanese business leaders in Tokyo, calling for more Japanese investment in Indonesia.

He urged Japanese investors to focus more on Indonesia's small and midsize firms, saying, "There are numerous opportunities for overseas investors to invest directly or work with those enterprises seeking to expand their operations."

He said Indonesia's small and midsize companies are "very resilient" and form the "backbone" of the economy, which has bounced back from a slump after being hit by the 1997 Asian financial crisis.

It is becoming clear that the traditional approach of promoting large new investments will not bring quick results under the present conditions," he said.

It is more likely that broad-based organic growth of small and midsize firms is required to stimulate growth in the large enterprise category," he said.