Jakarta (The Jakarta Post/ANN) - Eight American company executives, accompanied by US Ambassador to Indonesia Scot Marciel, paid a courtesy visit to Indonesia's Industry Ministry yesterday and expressed their concern over the Trade Ministry's attempt to limit imports of finished goods.
The executives, whom represent major companies such as General Electric, Caterpillar, Lockheed Martin and Fluidic Energy, were curious on how their businesses would be affected by the planned policy, said director general for International Industrial Cooperation Agus Tjahajana.
"The Americans tend to pay attention to regulations and they are very careful. If the regulation is unfair, they will not commit with their investment," Agus told The Jakarta Post.
Trade Minister Gita Wirjawan previously said he was preparing a ministerial decree that would terminate licenses for importing finished manufacturing products that were already produced in the country.
Gita said the decree would be effective in the first semester of this year. He said, however, local manufacturing companies would be given a grace period for importing finished products to support their initial operations until an agreed deadline.
The minister said the decree was intended to support investors, whether domestic or foreign, who had poured a large amount of investment into the domestic manufacturing sector.
The announcement on the planned policy immediately drew criticism from business players who feared that it would have wide and far-reaching implications.
Although the details of the policy have not yet been announced, Agus argued the trade minister's initiative could have a positive impact on foreign investors.
According to Agus, General Electric had planned to expand its investments in power turbines with state-owned electricity company PT Perusahaan Listrik Negara (PLN).
Meanwhile, he said, energy storage device producer Fluidic Energy was also planning to enlarge their business in the country by supplying back up power for publicly-listed telecommunication company PT Telekomunikasi Indonesia (Telkom).
Last February, aviation company Lockheed Martin had signed an agreement with Indonesian technology company CMI Indonesia to support the National Airspace Surveillance Republic of Indonesia (NASRI) by producing 40 radars with type TPS-77 and FPS-117.
Caterpillar is reportedly building a US$150 million plant in Batam, Riau Island to cope with the country's surging demand for heavy equipment, necessary for infrastructure development, plantations and mining projects.
"[They] have expressed interest to expand their investment in Indonesia, especially in the infrastructure sector, due to Indonesia's high economic growth. For example, we need radar for our seaports, heavy equipment to build roads, airports and so on. These companies are ready to support our infrastructure plans," Agus said.
Foreign direct investment (FDI) realisation from the US in Indonesia reached $1.48 billion last year, comprising 112 projects, surging 37.16 per cent from US$ 930.9 million from 100 projects in 2010.
The last year's US investment, represented an overall 7.78 per cent of total FDI of $19.28 billion in 2011, making it the third-largest foreign investor in Indonesia, Southeast Asia's largest economy.
In the first quarter of this year, the US realised 33 new projects valued at $17.9 million, as stated by the Indonesian Investment Coordinating Board (BKPM).
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