Saving tropical rain forests

This free-from-corruption country, whose population is said to be one of the most literate and highly educated in the world, celebrates its 40th Independence Day today. This full page report has been prepared to tell us something about Finland today and its relations with Indonesia.

Naturally, this country is home to the world's foremost experts on the paper, forestry, chemical, and electronics and electrotechnic industries.

And traditionally, the government and businessmen have had close ties with Indonesia, which regularly imported heavy machinery from Finland until recently when a cloud of uncertainty started to hang over the world economy.

"Besides that, our two countries have also very close relations in various international organizations at the multilateral level. This is, of course, due to Indonesia's position as one of the leading countries in this region," Finnish Ambassador to Indonesia Matti Pullinen told The Jakarta Post in an interview last week.

The trade balance has always been in favor of Indonesia for many years until lately, particularly when the demand for imported paper drastically dropped in the Indonesian market, Pullinen added.

For the first six months of this year, Indonesian imports -- according to the latest statistics available -- were valued at 296 million mk, while exports almost doubled to 494.3 million mk.

The goods shipped to Finland from Indonesia include metalliferous ores and metal scrap, electrical machinery, and furniture.

The other way around, Finland sells paper, iron and steel, telecommunications and sound recording equipment, heavy machinery, and fish to Indonesia.

"In the last couple of years, there has been a slump. It's (the trade) very small now for us which is a big difference compared to the previous figures," Pullinen said.

Despite the unfavorable developments in the bilateral trade, Finland has pledged to continue helping Indonesia with its reforestation program.

"It's very important for Indonesia and it's also important for Finland," said the envoy, who had just completed a four-day trip to various forest areas of East Kalimantan.

"The Indonesian rain forest, which is different from what we have in Finland, is essential not only for Indonesia, but also other countries in this region."

Under the scheme, which is still at the proposal stage, a group of Finnish experts, for example, will give free forestry education to their Indonesian partners.

"Some of the projects will hopefully be sponsored and carried out by Finnish private sector companies," Pullinen explained.

Finland itself has some 1,900 million cubic meters of forest reserves, the fourth largest in Europe after Russia, Sweden and Germany.

The ambassador also stated that Finland is keen to play a significant role in IT development in Indonesia.

The World Economic Forum in its latest 2001 Global Competitiveness Report released in October last year put Finland in the top spot, replacing the U.S. The report measures the comparative strengths and weaknesses of national economies. The survey examines the competitiveness of countries over a time frame of about five to eight years.

"And Finnish entrepreneurs should continue their efforts to offer products and services to Indonesia at highly competitive prices since the market here (in Indonesia) is already very competitive," the envoy suggested.

Finland's remarkable success in the high technology sector did not appear all of a sudden out of nowhere. The Finnish economy has gone through two complete metamorphoses over the past few decades. Until the 1950s, agriculture was Finland's principal source of livelihood.

In a matter of a few years, it saw the swiftest process of industrialization and urbanization of any country in Europe. More recently, the production of high technology has proliferated, while the traditional smokestack industries have been subjected to wholesale rationalization and internationalization.

Helsinki-based company Oy Nokia Ab is still the largest producer of cellular phones in the world.

The name Nokia comes from a small town in southern Finland, where a pulp mill was started back in 1865. The company grew through expansion and mergers, becoming a wide-ranging industrial conglomerate producing paper and pulp, car tires and rubber boots, cables, plastics and aluminum, consumer electronics and computers. An important acquisition was that of the radio and TV manufacturer Salora Oy, which provided the core facilities for the production of cellular phones, soon to become Nokia's prime asset.

"But mobile phones are not so important in our trade. And Nokia comes from various places in Asia. And that does not reflect our total trade," Pullinen said.

According to him, bilateral trade ties with Indonesia will be in favor of Finland only if construction activities in Indonesia return to normal again.

Many major Finnish companies, such as Kone, a producer of lifts, are already present in Indonesia, he said.

"But if construction activity slows down, nobody will buy these products," he said laughing.

In terms of tourism, Finland's reputation as a winter holiday destination has grown steadily. The main attractions are cross- country and Alpine skiing, snow-boarding, snowmobile safaris and husky-drawn sleigh rides. The largest numbers of visitors come from Sweden, Russia, and Germany.

Pullinen said some 1,000 Indonesians visited his country every year.

"It's a very, very small number," he said, adding that he had no figures on the estimated number of Finns who visited Indonesia.

Finland has a system of compulsory education for all children between the ages of 7 and 17. No tuition fees are charged. The school system ensures virtually a 100 percent literacy rate.

The recession caught Finland, like many other European countries, unprepared. But the fact that for several years GDP growth has been between 4 and 6 percent is a sign that the worst is over. The jobless rate, which hit an all-time high of almost 20 percent in the early years of recession, has come down to 10 percent in 2000, and according to some forecasts it should decrease further to 8 percent by about 2005.

According to 1996 official statistics. a managing director has a monthly income of over 29,000 mk (Rp .... ) per month, while a teacher 12,500 mk.

The trump cards of the Finnish economy in the future will be a high standard of education, general respect for agreements, a low level of corruption and good internal security.

-- K. Basrie