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Technology Stocks : INDONESIA'S PT TELECOM(TLK) -- Ignore unavailable to you. Want to Upgrade?

To: Gary105 who wrote (856)	10/19/1998 8:36:00 PM
From: m thompson	Read Replies (1) \| Respond to of 947

Habibie Envoy Seeks Australian Investment In Indonesia Dow Jones Newswires CANBERRA -- Indonesian Special Trade Envoy James Riady Monday urged Australian companies to invest in Indonesia for the medium- and longer-term to gain a "foothold" in the market ahead of its economic recovery. Riady, on a week-long visit to Australia to promote investment in Indonesia through meetings with local business and political leaders, said the Indonesian economy has a bright future beyond two to three years. The Indonesian envoy hopes his visit will spark greater co-operation between the two countries, and that Australia can assist Indonesia in its areas of expertise. "Australia is very strong in agriculture, Indonesia needs help in agriculture, Australia has had great success in privatization and how to make the make the government more efficient and effective, Indonesia needs that," the Australian-educated Riady told reporters here. "Australia could provide assistance in educational areas...and how to restructure Indonesian foreign sector debt, and the banking reformation and recapitalization, Australian banks can also play a part." Australia's ruling Liberal-National coalition has sold a number of government assets over the past three years that it regarded as not central to the operation of government including railway and airport assets. Largest of the privatization was the one-third sale of national telecommunications carrier Telstra Corp. (TLS), which generated revenue of A$14.3 billion. Indonesia is privatizing 12 state-owned companies including two telecommunications companies. International call operator PT Indonesia Satellite Corp. (IIT) is the next slated for sale, while PT Telekomunikasi Indonesia (TLK) last week said they wanted to wait until 2001. Both are listed on the New York Stock Exchange. Riady, who is one of Indonesian President B.J. Habibie's seven special business envoys, said Indonesia is a relatively low-cost location for investment, and has the necessary infrastructure in place. "The rupiah has devalued by the highest percentage amount of Asian countries, Indonesia is resource rich, it's a large market, Indonesian labor costs, even accounting for expected increases in wages, will still be about the most competitive in Asia, and the labor quality is also quite good," he said. "After the economic crisis, Indonesia is a substantial market that nobody can afford to ignore." Late Monday, the rupiah is at IDR7,800 to the U.S. dollar, compared with around IDR2,000 more than a year ago. An Indonesian official at the news conference noted Australian applications for investment in Indonesia between January and August of this year totaled just US$63 million of total investment applications of US$11.78 billion. "Australia needs to spend more," said the official. However, Riady conceded the Indonesian economy will struggle for the next two to three years. Inflation will be around 80% this year, gross domestic product will contract about 15%, the total number of people unemployed will rise to 20 million, and there will be around 50 million people without income, he said. Annual inflation for September was 82.4% compared with 77.7% the previous month. In all, the economy contracted 13.6% in the first nine months of 1998, compared with a year earlier, the Indonesian central statistics bureau said. Riady said the key factor in addressing these problems is resolving the large foreign private sector debt. Foreign private sector debt is around US$85 billion, of which around 50% is attributable to foreign companies based in Indonesia, he said. "How soon we can sort out private sector debt...will determine how long the recession is going to be in Indonesia. We're confident the creditors and the debtors are working through the various programs," Riady said. When asked what message he will convey to Australia's Prime Minister John Howard at a meeting scheduled for later this week, Riady said he will thank Australian people for their support since the start of the economic crisis. The envoy noted the Australian government's role in negotiations with the International Monetary Fund over its financial rescue package for Indonesia, to which Australia has pledged up to US$1 billion. Turning to regional matters, Riady said Indonesia will push for countries in the region to reaffirm their commitment to freer trade at an Asia-Pacific Economic Cooperation forum meeting in Kuala Lumpur next month. "This crisis shows that everyone is interrelated and hopefully it will send a powerful message of continuing to open barriers, not closing down borders, and the area they should be focused upon is how to get capital flows back to the region," he said, and reiterated Indonesia's opposition to capital controls. -By Benjamin Pedley; 612-6208-0901; bpedley@ap.org Briefing Book for: IIT \| TLK