Private sector investments on the rise in Batam

Private sector investments on the rise in Batam

JAKARTA (JP): State Minister for Research and Technology B.J.
Habibie said yesterday that total investments on Batam Island
reached US$5 billion as of the end of last year, with $4.2
billion or 83 percent coming from the private sector.

Speaking to members of the House of Representatives'
Commission X, which oversees science, technology and
environmental affairs, Habibie said that government investments
on the island, which has a population of 162,477, accounted for
only 17 percent or $860 million.

Batam Island, 20 km southeast of Singapore, is designed as an
export processing zone, which has its own regional authority.

Habibie said the proportion of government investments in the
area has continued to decline over the past years.

In 1978, government investments in the area reached $116
million or 57.6 percent of total investments, while the private
sector contributed $85 million.

In 1983, government investments rose to $253 million, but its
proportion dropped to 50.4 percent, while the private sector's
investments reached $249 million. In 1993, government investments
rose to $742.7 million but its proportion dropped to only 16.4
percent, while the private sector contributed $3.8 billion.

Investments by the private sector are made for businesses in
the industrial fields (52.2 percent), trade and services (11.62
percent), agribusiness (2.35 percent), tourism (17.75 percent)
and real estates (16.08 percent).

Foreign exchange revenues generated by Batam also increased
from $330,040 in 1978, which came only from exports, to $3.2
million in 1983, which came from tourism and exports, to $1.2
billion in 1993 and to $1.7 billion in 1994.

Currently, 194 domestic and foreign companies operate in
Batam, of which 59.2 percent engage in machinery, basic metal and
electronics industries, 2.1 percent in the chemical industry and
48.7 percent in multi-various industries.

Habibie said the government is currently also expanding the
export processing region to include surrounding islands, such as
the Rempang and Galang islands.

He said six bridges are currently being constructed to link
the islands. The bridges will have a length of 644 meters between
the Batam and Tonton islands, 420 meters between the Tonton and
Nipah islands, 270 meters between the Nipah and Setoko islands,
365 meters between the Setoko and Rempang islands, 385 meters
between the Rempang and Galang islands and 180 meters between the
Galang and Galang Baru islands.(pwn)