'Taiwan's economic relations with Indonesia are improving

'Taiwan's economic relations with Indonesia are improving

Veeramalla Anjaiah, The Jakarta Post, Jakarta

Taiwan, the archrival of China, has succeeded in improving
economic relations with Indonesia at a faster rate than on the
political front, where the island nation has been stymied by
Jakarta's "One China" policy.

"Taiwan's relations with Indonesia are cordial and
comprehensive. We have been cooperating with each other in
various sectors including agriculture, fisheries, tourism, labor
and industrial sectors," Taiwan's economic and trade
representative David Y.L. Lin said during a press briefing on
Sunday in Jakarta.

Taiwan has neither an embassy in Jakarta nor an official
diplomatic relationship with Indonesia.

China, the world's most populous nation and a permanent member
of the United Nations Security Council, says Taiwan is still part
of China and strongly opposes any country that tries to establish
diplomatic ties with its "renegade province". And Indonesia,
which has cordial relations with China, does not want to get
involved in the rivalry between China and Taiwan.

Yet, thanks to its "go-south policy" and all-out efforts,
Taiwan has emerged as an important economic partner of the
world's most populous Muslim nation.

The "go-south policy" was designed and pursued by present
Taiwan's President Chen Shui-bian to encourage Taiwanese
businesspeople to invest in Southeast Asian countries, including
Indonesia, instead of China.

"The total volume of our bilateral trade in 2003 reached
US$4.4 billion or increased 9.5 percent from the previous year.
Indonesia enjoyed a trade surplus of $1.41 billion in 2003 or an
increase of 25.1 percent compared to 2002," Lin, who assumed his
post just four months ago in Jakarta, said.

Being the fifth-largest foreign investor, with a total
cumulative amount invested of $13 billion as of the end of 2003,
Taiwan has been providing employment for thousands of Indonesians
through its 962 projects. The companies, like Pao-cheng Shoes
Co., ACER Bank Chinatrust, Na Ya Plastics, President Food and
RSEA are some of the major Taiwanese companies that are involved
in Indonesia.

"Though in recent times the focus of Taiwan has slightly moved
to Vietnam due to its inexpensive labor and better investment
climate, Indonesia is still an important destination for our
investors, Lin said.

While commenting further on the investment climate in
Indonesia from Taiwan's perspective, Lin said the rupiah's
stability was the most important factor in investment
considerations. The increasing wages are a real concern for most
investors.

Putting aside the problems of a poor investment climate,
including the security issue -- especially after the Bali Bombing
in 2002 -- a large number of Taiwan tourists are flooding
Indonesia.

"Around 300,000 Taiwan tourists visit Indonesia each year.
With 42 flights per week, there are three Taiwan airlines flying
between Taiwan and Indonesia," Lin said.

Taiwan employs around 56,000 Indonesian workers in household,
health, industrial and construction sectors.

"Actually, we do not have any problem with the Indonesian
government and we respect their policy on China. We do not
understand why China always protests whenever a minister or
official delegation from a country, which do not have diplomatic
ties with Taiwan, visits Taipei," Lin said.

For example, ministers from Germany, which do not have
diplomatic ties with Taiwan, have visited Taipei several times.

Taiwan has diplomatic relations with 27 countries from all
over the world and economic and trade representative offices in
more than 100 countries.

Lin also commented on the latest presidential elections, which
according to him, were conducted freely and fairly. The incumbent
president Chen's reelection was a democratic achievement for
Taiwan.

The latest elections were monitored by independent observers
from various countries including Indonesia. The Habibie center, a
think tank established by Indonesia's former president B.J.
Habibie, sent a team of observers under the leadership of Dewi
Fortuna Anwar, a research scholar, to Taiwan to monitor the
election.

Lin hopes that his country, which has investments totaling
more than $100 billion in mainland China, and Beijing will engage
in more dialog to improve the relations between the neighbors.