Kadin wooing wealthy Saudi investors

The Jakarta Post ,  Jakarta   |  Thu, 04/27/2006 10:52 AM  |  Business

Dadan Wijaksana , The Jakarta Post, Riyadh

The Indonesian Chamber of Commerce and Industry (Kadin) is setting up a special team of businesspeople to handle business and investment interests from cash-rich Saudi Arabia.

Kadin chairman M.S. Hidayat disclosed the move during a meeting Wednesday between the Indonesian delegation, led by President Susilo Bambang Yudhoyono, and businesspeople grouped in the Saudi Chamber of Commerce and Industry based here in Riyadh.

""We need such a team to make follow-up on any investment pledges made at the government level. So, it's a business-to-business relationship, to speed things up,"" Hidayat told the forum, adding that the team would be ready within a month.

As a test case, he added, the team would encourage and assist local Saudi businesses who wanted to participate in the upcoming Infrastructure Summit scheduled for September in Jakarta, when the country will make available dozens of infrastructure projects.

Yudhoyono, in endorsing the establishment of the special team, also invited the participation of Saudi investors in the summit, promising the government would have put in place all the necessary regulations and incentives by the time it was held.

He said the kingdom -- a prosperous country with a population of 26 million and per capita income of US$11,600 -- could turn to Indonesia's domestic market of 220 million people with increasing purchasing power.

Future prospects are even better, with Indonesia's economy steadily recovering from its slump during the 1997-1998 financial crisis.

The economy grew 5.1 percent in 2004 and reached 5.6 percent last year, with the government targeting an average of 6.6 percent in the five-year period ending 2009.

No investment pledges were made during the meeting, which was held on the second day of Yudhoyono's state visits to four Gulf countries and Jordan. The trip ends on May 4.

The forum was lively, with participants expressing interest in investing in Indonesia, especially in the fields of sharia financing, industry and energy sectors, particularly the oil and gas industry.

They expressed concerns about the complicated and costly bureaucracy, which has discouraged them from investing in the past.

""In Indonesia, we usually do not know who we should go to. You need to streamline the bureaucracy and clearly pinpoint which officials or organizations we should go to every time we have a problem,"" said Abdul Abdurrachman from the local chamber of commerce.

In 2004, Saudi Arabia was among the largest investors in Indonesia, with total investment of $3.02 billion in about 35 projects in sectors such as energy, oil and gas, the metal chemical industry, restaurant and real estate. In 2005, the figure slowed to $2.1 billion.

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