ASEAN KEY DESTINATIONS
Helping businesses start up in Indonesia
As foreign investors continue to show interest in Indonesia, local businesses are assisting them in setting up shop.
Security and business intelligence firms, lawyers and management consultants are reaping the benefits as foreign firms go through them to seek out reliable local partners and navigate licensing and tax processes.
Indonesia has become a magnet for investors who want to leverage on its natural resources and general political stability.
Anil Krishna, whose firm Veris delivers business intelligence to foreign corporates, said there has been a three-fold spike in the number of requests for background checks and due diligence on Indonesian companies and businessmen since 2008.
"The majority of our requests come from financial institutions," said Krishna, a Singaporean permanent resident who has worked in Jakarta for five years. "They want us to find out if there are any red flags with regard to potential partners."
Lawyer Ibrahim Senen of the DNC law firm said more investors from China and India, looking to snap up mineral and coal mining assets, are knocking on his door.
"In the last two years... we have been receiving inquiries on possible acquisitions, many in the mining sector," said Ibrahim, whose firm charges upwards of $10,000 for an acquisition deal.
Indonesia has not been an easy destination for firms looking to gain a foothold in Southeast Asia's largest market, but in recent years, the Indonesian government has attempted to streamline investment procedures - even putting the registration process online - with a commitment to improve infrastructure.
Firms like Okusi Associates, which provides a full suite of services ranging from visa to permit applications for foreign firms starting up their operations, help companies do the tedious legwork.
Said senior consultant Usmanto Njo: "It now takes around eight weeks from the time a corporation wants to set up an office, until the time it is fully operational. A few years ago, this process could take months."
Meanwhile, business people looking to do more work in Indonesia remain keen on figuring out the cultural norms and operational aspects of doing business across the archipelago.
International Enterprise Singapore, the government agency that helps Singapore firms to expand overseas, last week held its inaugural seminar on Indonesia. The five-day program in south Jakarta featured talks on the legal system, access to credit and managing Indonesian employees. The 24 participants also went on two plant visits.
IE Singapore's regional director for Indonesia, Lee Yee Fung, said the participants valued the "practical advice" given by speakers.
Richard Ho, marketing manager in Indonesia for electronics manufacturer Advanex, said he learned several things that would influence how his company executed its plans in the country, such as the existence of regulations that require legal contracts to be in Bahasa Indonesia and the importance of cultivating strong relationships with local partners.
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