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Minister ‘Optimistic’ Indonesia Ready for Asean Economic Community; Industries Disagree

posted Oct 2, 2015, 12:44 AM by Brook Ross   [ updated Oct 2, 2015, 1:19 AM ]
Abridged from, by: Ardi Wirdana, July 27, 2015

The Indonesian government has finally shown enthusiasm for the Asean Economic Community (AEC), after the trade minister said on July 15 that he was “optimistic” about Indonesia’s chances under the economic integration.

The big question that still hangs among Indonesians is whether or not the country is ready for AEC. The remark by the minister would suggest that the government believe that Southeast Asia’s largest economy is up for the challenge and ready for the change. This belief, however, is not shared by many business owners and workers in the country.

Jakarta Chamber of Commerce and Industry (Kadin) vice chairman Sarman Simanjorang says that only a few of the larger industries like banking and tourism are well equipped for the coming of Asean Economic Community. Others, he argues, are likely to struggle.

He pointed to the country’s small and medium sized enterprises (SMEs) in particular, which he says are in danger of dying out because the inability to compete with regional counterparts.

“The future of SMEs is very worrying, because there are so many products from foreign SMEs that are coming into Indonesia from countries like China and Singapore. If the products of our SMEs is not competitive, then i think our SMEs will slowly die under the AEC,” Mr Simanjorang told The Establishment Post.

One of the ways to save these businesses is to support them with sufficient training needed to upgrade their products and services, which he said should be initiated by the government.

“There must be improvements, concrete programs to train and educate them on financial management, about management product, about quality, design, packaging, as well as providing capital support,” he said.