When the widely-diversified business giant General Electric CEO Jeffrey Immelt visited Indonesia in October, he vowed to double his company’s investment which has reached US$1.2 billion on the back of the country’s economic resilient despite heavy blows from the global economic slowdown. His assessment on Indonesia’s economic condition was agreed by the President and CEO of GE Technology Infrastructure, John G Rice. The Jakarta Post’s Arghea Desafti Hapsari talked with Rice during his recent visit in Jakarta last week about his company’s plan to invest more in the railway and health care industries.
Question: GE Technology Infrastructure signed deals with China earlier this week. Will there be similar cooperation with Indonesia?
Answer: We are working on it. What you saw in China are two things: obviously a series of agreement that are our substantial commitment and partnership in our aviation, energy and transportation businesses
We are committed to expanding our global footprints and not just in countries like China. One of the things we are working on here is our locomotive proposal and we consider ourselves a partner of the Indonesian railway (company) and we want to expand that partnership.
So there will be new deals and new investment, especially in the railway business?
Yes, we are working on the details of that with our local partners… We are not ready to make an announcement today but we are moving it forward and we are working hard to make sure that we respond to what the railway is looking for.
We are absolutely prepared to invest. We have to work with the leadership of the railroad (management), and make sure that we have a program that makes sense for everybody.
(The state railway company PT KA) has been ordering four or five (locomotives) on an annual basis.
They decided that it might not be the most efficient way to do things. If you look at your requirement and take a multi-year view, you can create enough critical mass that it makes sense for us to (invest). For four or five units it doesn’t make sense to do a lot but for 100 or 150 it makes more sense to design a specific locomotive, to (make) local investment.
Jeffrey Immelt said he was going to double GE’s investment here, which has reached $1.2 billion. What do you say?
I think it is not impossible for us to put billions of dollars anywhere. We allocate capital based on where we see the best long-term prospect, so making investment of that magnitude is not out of the question.
Are you planning on investing in other sectors than what you have going on here in Indonesia?
I don’t know that we are. We’ve never ruled that out but we look at our businesses and our technologies and we think we have plenty of room to grow. Our healthcare business is a massive global business… and we’re relatively small in Indonesia. And partly that is because we have not spent enough time developing technology, which is suitable in a market like Indonesia.
Indonesia, with distributed nature of the population, and the fact that there are many people in relatively remote areas could be a good place for us, so we’ll be exploring ideas there.
So you’re talking partnership and cooperation in healthcare?
There is a new health minister; we have to determine what’s on her agenda and make sure that we’re ready to support the direction of the government. So it’s too early to say what that could be. But it’s a priority for the company. We have activities underway in many countries and we think that there should be opportunities for us to do more here.
GE’s projects in Indonesia
PT KA made an order of 20 C20-EMP locomotives worth US$40 million in July, with deliveries slated for 2010 and 2011.
GE and PT KA have also signed an MOU that commits the parties to work together to develop a long-term plan for the purchase or lease of up to 150 additional locomotives that will be specifically designed for Indonesia.
GE installed a PET-CT system, a diagnostic tool essential for cancer detection and treatment in children as well as for adults, in a hospital in North Jakarta in 2008. The project valued at around 8 million.
GE also provides MRI scanners for various hospitals in Indonesia. A scanner is priced at around 1 million.
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