Business people from China were still optimistic about business
opportunity and prospect of investment in Indonesia. On Indonesia side,
promotion for investment was being intensely launched by the Indonesia Embassy
and Indonesia Consulate in some cities in China especially Guangzhou and
Shanghai. “We can see that performance of the Coordinating Board of Investment
[BKPM] is getting better under the management of Chatib Basri [head of BKPM]
who is still young. BKPM is actively launching promotions to drum up investors
from China. “Adi Harsono, Executive Director of the Indonesian Business
Association [IBAS] disclosed to Business News [19/2].
The role IBAS was among others promoting investment the private way.
Besides IBAS was not even a Government body. IBAS, just like the Indonesia
Embassy [KBRI] and KJRI [Indonesian Consulate] also gave inputs to enhance effort
of drumming up investors. “As we launched promotions we also found problems
afield. We are giving inputs practically applicable afield.’
Meanwhile the Government generally only launched promotional campaign to
drum up investors from China. Other routine things done by the Government when
drawing foreign investors were offering incentives, regulation amendments etc.
but the Indonesia Chamber of Commerce [KADIN] and IBAS dealt more with other
things like business calculations. Cases of bureaucracy in provincial
Governments, workers affairs etc were also IBAS’portion in sorting out with
foreign investors. The dynamics of investment climate was also heightening.
Debate between the Indonesia Businesspeople Association [APINDO] led by Soyan
Wanandi and the Government continued. APINDO also argued with labor unions who
run anarchic demonstrations. “Those are problems that made Chinese investors
hesitate to invest” Some businesspeople questioned why internal policies in
Indonesia always changed. IBAS was also trying to convince them that such were
only dynamism. But the Chinese investors could not take it as something usual.
They were not accustomed with political or social dynamism of the Indonesian
people.
IBAS admitted that there was once a candidate investor from China who
planned to invest in the oil gas sector in spite of the risk.
We informed them there was a Korean company who wished to release 10
percent of their share an Block M Madura belonging to PT Pertamina since the
production output was below expectation, only 1,200 barrels per day of the
targeted 20,000 barrels per day. We convey this information to the Chinese
investor. “They finally are willing to invest after analyzing the opportunity.
They agreed to take over the 10 percent share at the Block Madura Pertamina
released by the Korean investor.”
The tender process for the 10 percent almost took place. But as they
returned to China, news busted out that BP Migas was dismissed by the
Constitutional Court on November 13, 2012. He instantly resigned from the
tender. He once asked IBAS “Can you guarantee that our investment is secure?”
He questioned the legality aspect of similar bodies like BP Migas Substitute
Task Force and Collaboration Contractor [KKKS].
Doubt also crept in that the new bodies would not last long; they were
extremely worried that there might be another dismissal of the new bodies. This
was a difficult question an our answer to it is: “We don’t know.”
IBAS could only give encouragement and advise them to invest. Chinese
businesspeople were in experienced; they were different from businesspeople
from Japan or Korea who were bay far more experienced. Japanese and Korean
businesspeople were more accurate in calculating business risk including
regulations in Indonesia. Meanwhile IBAS also concentrated more on handling
small scale companies of USD 10 – USD 20 million capitals. “Big investor like
Foxconn Technology Group [an electronic component producer From Taiwan] was
very unlikely to meet IBAS. A company of that size normally contact Government
institutions like BKPM, Ministry of Industry, Ministry of Trade etc.” (SS)
Business News - February 22,2013
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