Top investment priorities focus on garment and wood
JAKARTA (JP): The implementation of the new General Agreement on tariffs and Trade (GATT) will help increase the competitiveness of Indonesia's wood and textile products, leather goods, electronics, and machinery on the world market, a minister says.
"Indonesia, therefore, will put a high priority on the promotion of the exports of these products in the coming years," Coordinating Minister for Industry and Trade Hartarto said in a luncheon meeting with the Indonesia Financial Executive Association (IFEA) here yesterday.
According to the Central Bureau of Statistics, Indonesia's exports of both wood and textile products went up -- wood by 30.8 percent to US$5.47 billion last year from $4.18 billion in 1992 and textile products by two percent to $6.18 billion from $6.06 billion.
However, exports of leather goods declined by 8.5 percent to $73.66 million from $80.54 million.
The bureau's latest monthly report also shows that, last year, the country's exports of machinery reached $180.3 million and electronics reached $1.54 billion.
Hartarto said increasing exports was necessary for Indonesia to earn more foreign exchange. He expressed that this was a critical move for Indonesia, which would find it more and more difficult to obtain soft loans for its development projects as it developed economically.
Indonesia will also face fiercer competition from countries such as China, Vietnam, the Philippines and Bangladesh in attracting foreign investments for its industrial development, he said.
Indonesia's total exports last year increased by 8.4 percent to $36.82 billion from $33.96 billion last year.
Opportunities
Hartarto said the minister of trade is currently busy communicating the results of the recently concluded Uruguay Round of negotiations on GATT to businessmen, to encourage them to seize the opportunities offered by the new agreement.
He said rapid growth in exports would help Indonesia maintain its annual economic growth rate of seven percent.
To support the export promotion, the minister said that the government would continue efforts to maintain the country's political stability and its conservative macro-economic policies.
The government will also continuously introduce deregulatory measures to improve efficiency, he said. "We have to create an efficient bureaucracy to attract foreign investors," the minister stated oxymoronically.
However, he declined to specify when the government would announce its planned deregulatory measures. "Please, be patient for the next announcement," the minister said.
A number of government officials have revealed that the new deregulatory measures will allow foreign investors to hold more equity in Indonesian projects and simplify licensing procedures.
An informed source said President Soeharto has signed the new measures and will probably make an announcement this week.
Hartarto said yesterday that the government will also encourage companies to improve their human resources to increase productivity.
He explained that some 70 percent of Indonesia's trading activities are concentrated in the Asia-Pacific region, particularly Japan, Taiwan, South Korea and the United States.(09)