ASEAN KEY DESTINATIONS
Indonesia expects investment from 25 US firms
Twenty five American companies were planning to make investments in Indonesia in spite of the current financial crisis facing their country, Antara reported, quoting discussions at a meeting between a US-Asean Business Council delegation and the Indonesian minister of industry Fahmi Idris in Jakarta Wednesday.
The US companies include Dow Chemical, General Electric, Mosanto Corp, Pfizer, Conoco Philips, Johnsons & Johnsons, Microsoft, and Oracle which had already been nvesting in Indonesia, and new investors such as Guardian and Marathon Oil, reported the Indonesian national news agency.
Fahmi Idris said that in principle the companies wished to invest in the country, but still awaiting the country's secured gas and electricity supply, as well as any tax incentives the country would offer.
For example, he said, Guardian plans to invest $150 million in the production of flat glass, while Mosanto around $12 million in supplying plant seeds.
Marathon Oil meanwhile plans to conduct production cooperation with PT Pertamina, while Caterpillar wishes to develop its line of production and General Electric to invest in locomotive production in cooperation with PT Inka.
Fahmi said he believed the current global economic crisis that broke out in the US and Europe prompted the American companies to seek safer places for investment.
"They are just seeking the right countries to save themselves namely countries whose economy is not badly affected by the crisis," he said.
He said Guardian besides Indonesia was now also considering investing in other Southeast Asian (Asean) countries such as the Philippines and Thailand.
"They however believe Indonesia's economy is now more stable," he said.
A US delegate in the meeting, Chris Fedderson, meanwhile said that US companies had chosen Indonesia as their investment destination because the country's economy had been favorably growing by six per cent.
"Indonesia has a large market and therefore has good business prospects," he said.
He said besides Indonesia, the US businessmen would also visit other countries such as Vietnam, Thailand and India also seeking investment opportunities.
Vice president of the US-Asean Chamber of Commerce and Industry William Warmon meanwhile said that the US companies were not discouraged by the crisis to invest in Indonesia.
In order to speed up the realisation of business he called for the country's infrastructural readiness including electricity supply. Minister Fahmi Idris said that electricity supply was no longer a crucial problem in the country particularly in Java.
He said in June 2009 three new power plants would start operating namely the plant in Labuan, West Java, with a capacity of 600 MW, Indramayu, also in West Java, with a capacity of 500 MW and in Rembang, Central Java.
On gas supply he said that the pipeline to distribute gas from a number of refineries in Sumatra to Java had also been operating well so that factories around Banten, Cilegon and in the northern parts of Java were no longer facing gas supply shortfalls.
On their request for tax incentives the minister said that it was no problem because the matter had already been laid down in a government regulation.