Challenges to work on for better S’pore-Indonesia ties

I refer to the report “Indonesia has high hopes for new industrial park developed with S’pore” and the commentary “Indonesia-Singapore retreat: Building trust on three issues” (both Nov 14).

Indonesia, as our biggest neighbour, has vast territory and abundant resources, and can provide a lucrative investment environment. Singaporean investors should tap its relatively low investment costs, cheaper labour supply and logistical support services.

Simultaneously, Singapore’s business partners in Indonesia should draw on our experience in trade, finance and technology to advance and consolidate their businesses.

The new Kendal Industrial Park, operated by SembCorp Development from Singapore and Indonesian company PT Kawasan Industri Jababeka, is clearly built on this logic.

Since the 1990s, many industrial collaborations in Batam, Bintan and Karimun have proved to be successful, and Singapore is one of Indonesia’s largest foreign investors.

Hence, in the long run, the trade, economic development and other co-operation between the two countries would also be of mutual benefit.

To continue this bilateral success, however, some challenges should be monitored closely, and the Indonesian government must take measures to boost investor confidence.

First, it must curb, minimise or eradicate the red tape and corruption in its provincial and central administrations. Further, Indonesia should consistently improve its administrative transparency and efficiency to lure potentially keen and quality foreign investors.

Second, present and future Indonesian governments must do their best to resolve and disentangle political wrangles in which politicians scramble for power in their own interests.

With regard to Indonesia’s tax amnesty programme, our Government should work in fellowship with its counterpart and uphold Singapore’s reputation for honesty by continuing to crack down on money laundering.

Finally, both governments must collaborate closely to analyse and find workable solutions to the thorny issues of transboundary haze pollution and the threat of terrorism.