The response from some Japanese investors, saying that they wanted to relocate their factories and reconsider their investment plans in Indonesia after being turned down for the Jakarta-Bandung high-speed railway project was too excessive, a lawmaker says.
“[Japan’s response] is excessive. However, it is our fault to pick the unproven China’s train technology. We need to approach Japan again. The country is Indonesia’s strategic partner in the last five decades,” Chairman of the House of Representatives’ Commission VI overseeing investment Hafiz Tohir said as quoted by Kompas.com.
He added that the government needed to introduce a new approach to ease the tension, since Japan was one of the Indonesia’s main trading partners.
Investment Coordinating Board (BKPM) data showed that Japan’s total investment realization of US$1.6 billion was ranked third as of the first semester this year. The amount represents 11.3 percent of Indonesia’s total investment realization.
BKPM’s deputy head for investment implementation control Azhar Lubis called on Japan to think positively because the Jakarta-Bandung high-speed railway was only one of many projects that Indonesia was offering.
As reported previously, some Japanese investors planned to reconsider all of their business relations with Indonesia, especially in land, infrastructure and transportation projects, citing their disappointment over the high-speed railway project.
However, Azhar said that as of Wednesday, not a single Japanese investment plan had been withdrawn from Indonesia. “It is not that easy to revoke an investment. Once they build a plant, it is impossible to annul it,” Azhar said.
A public policy observer Agus Pambagio said Japan’s displeasure was a logical consequence of the incomprehensive policy. According to him, State Owned Enterprises Minister Rini Soewandi is who should take responsibility for all of the backlash.
"It is the minister’s [responsibility]. This high speed-train project is quite odd, and fishy. It’s understandable [for Japan to be upset] and it’s a signal that [President] Jokowi should observe the geopolitical map. We cannot just decide [a policy] without thinking," he said.
Commenting on the debate, Minister Rini highlighted that Indonesia was not willing to give government guarantees for the project, as Japan had requested. On the other hand, China did not request government guarantees in their proposal.
“We’re still finalizing a discussion with China’s government on the project. We have decided that none of the state budget will be involved in the project, thus we’re negotiating to create a joint venture company with China,” Rini said. (ags/bbn)(++++)
