Power struggle mounting in Batam

Power struggle mounting in Batam

Fadli, The Jakarta Post, Batam

The conflict between the Batam administration and the Batam
Industrial Development Authority (BIDA) has been mounting after
the local administration issued numerous permits to companies
following the implementation of regional autonomy on the island.

Many domestic and foreign investors have been confused as both
sides have claimed they have the authority to deal with investors
and their investments in industrial zones on the island.

BIDA has said that, based on Law No. 53/1999 and Presidential
Decree No. 74/1971 on industrial zone development, it was the
single institution established by the government to supervise
industrial development on the island. But the local
administration has also claimed its authority to perform the same
function in accordance with the regional autonomy law.

Ismeth Abdullah, BIDA chairman, said there should be no
overlapping authorities on the island and that the local
administration should coordinate with BIDA and the central
government in carrying out its development programs.

"Therefore, the Home Affairs Ministry should coordinate with
the Trade and Industry Ministry and the Investment Coordinating
Agency (BKPM) to resolve the prolonged conflict.

"We are waiting for the promulgation of a government
regulation on how the Batam administration and BIDA should
coordinate their efforts in dealing with industrial development
on Batam and other islands in the Riau archipelago," he said in
an interview with The Jakarta Post here recently.

According to him, BIDA has its own authority to issue permits
to foreign investors and to manage the seaports and airport on
the island.

"So far, BIDA has issued more than 50 permits for foreign
investors while other foreign companies on the island have
secured their permits from the central government," he said.

He said the total domestic and foreign investments on the
island had reached US$ 8.360 billion.

Separately, Batam Mayor Nyat Kadir declined to make further
statements on the mounting conflict in an attempt to calm the
situation.

He urged the central government to issue a regulation on how
both sides should co-operate to develop the island.

"Batam has many other urgent problems than this one to solve,"
he said without elaborating.

He admitted he had granted numerous permits to a number of
companies on the island but said it was in line with the
implementation of regional autonomy.

Marganas Nainggolan, chief editor of the daily Sijori Pos in
Batam, called on all mass media outlets to remain neutral and
independent in the face of the conflict between the two
government institutions.

He admitted that the conflict had caused confusion among both
local people and foreign investors and said the central
government should take the necessary measures to resolve it.

"Many foreign investors will decline to invest on the island
unless political and legal certainty is maintained," he said.

Hasan, chairman of the Malay Youth Organization, locally known
as Masyarakat Tempatan, said that the conflict had risen to the
surface because the local administration had for a long time
performed minor functions dealing with death, garbage and
identity card affairs.

"We want both to work hand in hand to develop the island
because millions of people from other provinces have invested
their futures in their children and relatives employed by
domestic and foreign companies on the island," he said.

Svein Moldskred, general manager of the star-rated Batam View
Hotel and Resort, admitted many foreign investors had been
confused by the mounting conflict between the local
administration and BIDA.

"Both institutions should provide a one-stop service to the
public, including foreign investors," he said cautiously.