Trade and industry, the backbone of Sweden-Indonesia relations

Trade and industry, the backbone of Sweden-Indonesia relations

Swedish Ambassador to Indonesia H.E. Harald Sandberg shared his view on the bilateral relations between the two countries during his term here.

Question: You have been the Swedish ambassador to Indonesia for three years. What are your thoughts and what is your message today?

Sandberg: When I look back at my three years in Indonesia, I see times of difficulties and hardship for the Indonesian people. Obviously, anyone who has fallen in love with this country is concerned today. These three years have also seen profound political changes, however, with a new openness, free elections and governance with a democratic mandate. These changes have led to a positive increasing interest for Indonesia in my country. I look forward to see further positive changes and developments. Indonesia's enormous potential in all fields is better understood than ever. I also see an increasing interest for Sweden in Indonesia, and travel between Sweden and Indonesia is increasing.

Sweden and Indonesia have a long tradition of good diplomatic relations. What do the relations between our two countries mean to you as ambassador?

For me, relations between countries primarily mean people-to people relations. The backbone of our relations has always been in trade and industrial contacts.

Everyone recognizes an Ericsson cellular phone, but how many know that the telephone system they are talking through builds on Ericsson equipment? Tetra Pak fruit juice containers are used all over Indonesia. Indonesian women will associate quality cosmetics with Oriflame, sold all over Indonesia, and millions of Indonesian motorcycles run on SKF ball bearings. The yellow Swedish Match matchboxes are recognized by millions of Indonesians, as are Lux and Electrolux home appliances. Hundreds of thousands of Swedes have Indonesian products from the furniture chain IKEA in their homes or wear Hennes & Mauritz Indonesian made clothes. Millions of Indonesian meals are served on Perstorp's Indonesian made first-class dinnerware, and who wouldn't like to have his valuables in a Chubb safe? Anyone in mining will think of reliability and high tech when hearing Atlas Copco mentioned, and did you know that milk and cream are separated with Alfa-Laval equipment? Swedish consumers are enjoying excellent Indonesian pineapple and Indonesian drivers feel safe in Volvo and Scania cars, trucks and buses. Indonesians are listening to Swedish music artists like Roxette, Meja, Cardigans, Eagle-Eye Cherry and A-Teens.

I could talk also on cultural exchange, or on the thousands of people traveling between our two countries each year, but these examples from the business world are also examples of people-to-people relations!

How do you see relations developing?

Let me give an example. With globalization and the IT revolution, the distance between our countries is shrinking dramatically. With instant information we have become neighbors. Swedish industrial buyers like Ericsson, the global technology group ABB, pharmaceutical giants Astrazeneca and Pharmacia, steel companies like Assab and welding specialists Avestapolarit and ESAB have encouraged the development of a wide range of IT solutions and fostered the creation of a number of Swedish IT companies. In Indonesia we see the activities of IFS, a business applications supplier, and Scala, the Internet business group. And if you want to know what Jakarta-based Atlantis Software is doing, take a look at www.ciptasoft.com.

There is great scope for further and broader relations between our countries. We need to use our new "neighbor relationship", learn to know more about each other and see how we can build "win-win" relationships.

A year ago you were asked whether Swedish companies are coming to Indonesia to invest in the aftermath of the crisis. You saw a positive trend back then. What are your impressions now?

We are seeing a further normalization in trade and commercial contacts, which will be beneficial for both parties. For me, this is what globalization is all about, a mutual exchange of goods and services, and with these contacts, come an increased interaction of people. In addition, it is not only the companies that will benefit from the increasing contacts, but also the consumers.

At the moment there are about 50 Swedish companies with their own representation here in Indonesia, and many, many others who are represented through agents. Swedish related companies employ over 10,000 people here in Indonesia. I think there is a clear potential for an increase in the number of Swedish companies operating here.

However, there are still challenges that have to be overcome. Continued financial sector reform is central, and an equitable solution to the issues of private sector debt is crucial for the credibility and recovery of the Indonesian economy. Other challenges lie within the social and environmental areas, i.e. in sustainable forestry and preservation of Indonesia's heritage in its tropical forests. Yet another challenge lies within the decentralization process.

Last but not least, the legal system must gain credibility. Business is risk, and the last thing businesspeople want are governments adding risk, which cannot be measured. The government has made it a priority to eradicate corruption, collusion and nepotism. Rules and regulations, be they in taxation, in customs or in other areas, should be transparent and the implementation must be predictable and equally applied to all parties.

If these challenges can be overcome, I am sure there are great potential for an even further expansion of business between our countries. And increased business will serve as a catalyst for further and broader relations in politics, in culture and in other areas.