ID :
10251
Tue, 06/17/2008 - 19:25
Auther :
Shortlink :
http://m.oananews.org//node/10251
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INVESTMENT GROWTH IN MANUFACTURING SECTOR IN 2008 TO STAGNATE : BIZMAN
Cikarang, W. Java, Jun 17 (ANTARA) - Investment growth in the manufacturing sector in Indonesia is expected to stagnate in 2008 due to the recent fuel oil price hikes and the upcoming general elections, a business community spokesman said.
"In the mining sector and in agribusinesses like palm oil, investment will increase. But in manufacturing, it will stagnate," Indonesian Businessmen's Association (Apindo) chairman Sofyan Wanandi said on the sidelines of a meeting on export and investment development here Tuesday.
Wanandi urged the government to speed up improvement of infrastructure facilities, including roads and power supply, and reduce the high economic cost of doing business.
"The economic costs of doing business in the country are extraordinarily high because of stagnation. This has made investment here not attractive, much less so because our power supply is limited," he said.
Wanandi estimated the country's economic growth in 2008 would not exceed six percent due to infrastructure problems.
"We would be lucky if growth could reach six percent. But I think it will be less than six percent," he added.
According to Wanandi, Indonesia now had a chance to attract Chinese labor-intensive industries which were planning to relocate their factories after the Chinese government had imposed stricter manpower rules.
"We should move quickly and make them relocate to Indonesia," he said.
Some textile and garment industries in Korea had moved to Bandung, West Java, where they had made investments averaging US$5 million to US$10 million.
"Some small industries have relocated from Korea and moved to Indonesia. But the big ones have yet to leave their country," he said, adding they were still studying Indonesia's regulations.
Nike investment
Although growth in the manufacturing sector was stagnant, Wnanandi said, there was still positive development in the footwear industry in 2008.
Footwear maker Nike had built a factory in Sukabumi, West Java, with a total investment of US$50 million, a production capacity of 1-2 million shoes, and 7,000 workers.
"At least they have expanded (their activity) here, not in China anymore. They meet demand in Korea and Taiwan, and their factrory is to begin operating this year," he said.
After Nike had invested in Indonesia, some other companies overseas were now eyeing Indonesia as a country to which they might relocate their ptoduction facilities, Wanandi said.
"In the mining sector and in agribusinesses like palm oil, investment will increase. But in manufacturing, it will stagnate," Indonesian Businessmen's Association (Apindo) chairman Sofyan Wanandi said on the sidelines of a meeting on export and investment development here Tuesday.
Wanandi urged the government to speed up improvement of infrastructure facilities, including roads and power supply, and reduce the high economic cost of doing business.
"The economic costs of doing business in the country are extraordinarily high because of stagnation. This has made investment here not attractive, much less so because our power supply is limited," he said.
Wanandi estimated the country's economic growth in 2008 would not exceed six percent due to infrastructure problems.
"We would be lucky if growth could reach six percent. But I think it will be less than six percent," he added.
According to Wanandi, Indonesia now had a chance to attract Chinese labor-intensive industries which were planning to relocate their factories after the Chinese government had imposed stricter manpower rules.
"We should move quickly and make them relocate to Indonesia," he said.
Some textile and garment industries in Korea had moved to Bandung, West Java, where they had made investments averaging US$5 million to US$10 million.
"Some small industries have relocated from Korea and moved to Indonesia. But the big ones have yet to leave their country," he said, adding they were still studying Indonesia's regulations.
Nike investment
Although growth in the manufacturing sector was stagnant, Wnanandi said, there was still positive development in the footwear industry in 2008.
Footwear maker Nike had built a factory in Sukabumi, West Java, with a total investment of US$50 million, a production capacity of 1-2 million shoes, and 7,000 workers.
"At least they have expanded (their activity) here, not in China anymore. They meet demand in Korea and Taiwan, and their factrory is to begin operating this year," he said.
After Nike had invested in Indonesia, some other companies overseas were now eyeing Indonesia as a country to which they might relocate their ptoduction facilities, Wanandi said.
