choongyong.koh's clips tagged indonesia

Indonesian V-P Confident Problems Of SEZs Can Be Overcome

choongyong.koh — Tue, 05 Sep 2006 02:35:24 -0000

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Straits Times (26 August 2006) - Indonesian V-P Confident Problems Of SEZs Can Be Overcome

Aug 26, 2006
Indonesian V-P Confident Problems Of SEZs Can Be Overcome
Jusuf Kalla pledges to clear roadblocks standing in the way of Batam's growth
By Indonesia Correspondent, Salim Osman
Straits Times

JAKARTA - INDONESIA'S Vice-President Jusuf Kalla has expressed confidence that the problems dogging the Riau Islands Special Economic Zones (SEZs) can be overcome.

Mr Jusuf was speaking on Thursday after a trip to Batam, an island in the Riau archipelago, and a meeting with Singapore's Minister Mentor Lee Kuan Yew at the Hang Nadim airport.

He acknowledged that investors had left the island lately because of management problems and pledged to clear all the roadblocks that stood in the way of the island's growth.

'I am optimistic that it can be revived,' he added.

Mr Lee had said that he believed the trend could be reversed in three years if all were determined to fix problems such as corruption and bureaucratic delays.

The resolve to overcome the SEZ problems received wide publicity in the Indonesian media yesterday.

A Media Indonesia report had the headline: 'Kalla-Lee agree on boosting investment climate in Batam'.

It carried a photograph of Mr Lee and Mr Jusuf on its front page and the report included Mr Lee's remarks on some of the problems related to immigration, tax, and customs and excise duties.

Mr Lee was quoted as saying that Indonesia was a large country and faced a range of problems that had hindered the growth of Batam.

It added that he had urged all sides to cooperate to solve the problems in Batam.

News of the meeting was also carried by Kompas, which reported Mr Lee as saying that Batam was not progressing as rapidly as in the days when it was developed jointly by the Singapore Government and the Suharto administration.

'Today, there are so many problems that hinder its growth as a Special Economic Zone. Because of this, more needs to be done to spur growth,' Mr Lee was quoted as saying.

Both newspapers also said Mr Kalla agreed with Mr Lee on the problems faced by Batam and the need to rejuvenate SEZs.

Evening newspaper Suara Pembaruan carried a short report on the meeting, quoting the Minister Mentor as saying that the problems faced by Batam had been discussed.

Media Indonesia's online edition carried remarks posted by readers, many of them positive, on the involvement of Singapore in the project to develop Batam as an SEZ.

For instance, a posting by Dodo urged readers to rid themselves of prejudices against Singapore. The writer said forging close ties with Singapore would help Indonesia make its way up the ladder to achieve the status of becoming a developed country.

Singapore and Indonesia inked a new economic agreement in June to revitalise the Riau islands of Batam, Bintan and Karimun.

Under the pact, the two nations will set up SEZs to draw more investment and boost economic growth in the area.

It could see a smoother flow of goods between Singapore and the Riau islands, and make it easier for businessmen to invest by simplifying procedures for work permits and visas.

There will also be an investment service authority to help businessmen deal with licences and documentation.

The seven areas targeted to draw investors are investment, finance and banking, taxation, customs and excise, immigration, manpower and developing capability.

The two countries also hope the SEZs could be a model for similar projects to be started elsewhere in Indonesia.

Mr Lee said on Thursday that SEZs could be replicated across Indonesia.

Riau SEZs Have Problems, But They Can Be Solved: MM

choongyong.koh — Tue, 05 Sep 2006 02:33:00 -0000

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Straits Times (25 August 2006) - Riau SEZs Have Problems, But They Can Be Solved: MM

Aug 25, 2006
Riau SEZs Have Problems, But They Can Be Solved: MM
He is optimistic that with the right attention, zones can be a success
By Peh Shing Huei
Straits Times

BATAM - INVESTORS have been leaving Batam, but Minister Mentor Lee Kuan Yew is optimistic that problems in the Riau Islands Special Economic Zones (SEZs) have a chance at being solved.

With the right attention, the zones can be a success. He gave this assessment after a half-day trip to Batam and a 'four-eye' meeting with Indonesian Vice-President Jusuf Kalla yesterday.

Mr Lee heard the problems first-hand when he toured the Batamindo Industrial Park, which is managed by SembCorp Park Holdings.

Among other things, unions have rocked industrial relations, pushing wages up by 29 per cent last year.

Corruption from officials is more prevalent and investors are also increasingly concerned about terrorist threats.

Mr James Kong, the chief executive officer of eye-care company CIBA Vision, a tenant at the park, recounted to Mr Lee one example of the problems the company faced: Tax officials pored over minute details and made things difficult to pressure managers into giving kickbacks.

All these difficulties combined to push the park's tenant numbers from a peak of 96 in 2001 to 83 today. The number of workers employed there has also shrunk as a result, from 85,000 to 65,000.

SembCorp Park Holdings executive chairman Low Sin Leng told Mr Lee that investors, especially the Japanese, were migrating to other countries, with Vietnam a popular destination.

But Mr Lee said he believed the trend could be reversed in three years if all onboard were determined to fix the problems.

After his meeting of more than an hour with Mr Jusuf yesterday, he expressed hope that Jakarta could solve the SEZs' woes.

'If he gives it attention, if he is hands on, I would say there's a chance that it could succeed,' said Mr Lee, referring to Mr Jusuf. 'But if it's just left to the bureaucracy, we may try our best, but it will be defeated by the system.'

He added that Mr Jusuf 'showed a certain willingness to spend time and effort to oversee the problems and get it right'.

The problems, he said, began when increased regionalisation in Indonesia saw governors and mayors asserting themselves, as they are now elected instead of being appointed by Jakarta.

He stressed that the problems could only be ironed out by the Indonesians. 'We will help them the best way we can, but some things on the ground we cannot fix, they have to fix it,' he said.

Referring to the pressures tenants faced from officials, such as harassment over tax and other paperwork, he said investors did not have to put up with that and could go elsewhere.

Singapore and Indonesia inked a new economic agreement in June to revitalise the Riau islands of Batam, Bintan and Karimun.

Under the pact, the two nations will set up SEZs to draw more investment and boost economic growth in the area.

It could see a smoother flow of goods between Singapore and the Riau islands, and make it easier for businessmen to invest by simplifying procedures for work permits and visas.

There will also be an investment service authority to help businessmen deal with licences and documentation.

The seven areas targeted to draw investors are in investment, finance and banking, taxation, customs and excise, immigration, manpower and developing capability.

Prime Minister Lee Hsien Loong, who witnessed the signing of the pact with Indonesian President Susilo Bambang Yudhoyono, said at the time that he hoped the SEZs could refresh earlier efforts by Singapore and Jakarta to draw investment to the Riau province.

While these had created more than 200,000 jobs from 1990 to 2000, investment had tapered off in recent years, PM Lee had noted.

The two countries also hope the SEZs could be a model for similar projects to be started elsewhere in Indonesia.

Yesterday, as MM Lee emerged from his meeting with Mr Jusuf, he told the waiting media that the SEZs may be replicated across Indonesia.

He cited China's experience. 'Deng Xiaoping started the special economic zones along the coast, 12 of them, succeeded, expanded, duplicated and now almost the whole country is a special economic zone,' he said.

'All in the space of 30 years. So it can be done, if you decide to do it.'

Indonesia offers S'pore 3 sectors for investment

choongyong.koh — Tue, 05 Sep 2006 02:04:49 -0000

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Indonesia offers S'pore 3 sectors for investment

Date: 07/08/2006
Source: Straits Times
Author: Ken Kwek

VISITING Indonesian President Susilo Bambang Yudhoyono yesterday offered Singapore businesses opportunities in three key areas his country is keen to develop: infrastructure development, biofuels and special economic zones (SEZs).

Singapore can play a part as Indonesia undergoes serious reform to raise economic growth, he said during a lunch talk with businessmen, chaired by Singapore's Trade and Industry Minister Lim Hng Kiang.

The president, who is on a two-day working visit in Singapore, said Indonesia offered opportunities in infrastructure development, such as power, toll road systems and housing.

He invited Singapore's leaders and businessmen to attend an infrastructure summit in Jakarta in November to exchange ideas and seek investment opportunities.

The Indonesian leader also said Singapore could play a part in Indonesia's efforts to increase biofuel production. The Indonesian government recently announced plans to build eight biodiesel factories, to produce energy alternatives to fossil fuels, such as biodiesel from oil palm.

Dr Yudhoyono asked Singapore companies to invest in biofuel projects, adding that he was also looking at introducing new policies in the financial sector to encourage capital investment in certain areas.

As for the recent agreement between Indonesia and Singapore to set up SEZs on the islands of Batam, Bintan and Karimun, Dr Yudhoyono indicated that progress was underway. For example, the joint working groups and committees, comprising representatives from both countries, had met and were working on an 'action plan' to stimulate greater investment.

He added that he had already given 'clear directions' to his officials to streamline services for businesses, by reforming Indonesian government agencies such as the customs, tax and immigration offices in Batam.

The SEZ agreement was inked when Dr Yudhoyono and PM Lee last met in Batam on June 25.

Both leaders agreed to promote the islands' manufacturing potential, ease the flow of goods, manpower and funds, and train workers and administrators.

The SEZ was one of the issues that cropped up when the president and PM Lee had a 'four-eye' meeting before dinner. A statement from the Prime Minister's Office said the two leaders discussed bilateral issues. They affirmed the importance of making progress on the parallel negotiations for a series of agreements on an extradition treaty, defence cooperation and counter-terrorism cooperation. They also discussed international issues, including the situation in the Middle East and developments in Asean.

Dr Yudhoyono also met Minister Mentor Lee Kuan Yew in the evening.

During his visit here, the president took pains to assure the Singapore business community that Indonesia was serious about reform to improve the business climate and expand its economy.

The president, accompanied by his wife Kristiani Herawati and a delegation including Economic Coordinating Minister Boediono and Foreign Affairs Minister Hassan Wirajuda, leave for home today.

kenkwek@sph.com.sg