South Korea makes high technology investment in Indonesia

Jakarta, April 8, 2008 – As reported by the National News Agency thru its ANTARA News (PubDate: 04/08/08 13:41) the South Korean Ambassador to Indonesia Lee Sun-Jin said his country has expanded its investment in Indonesia to high technology industries from labour intensive investment.

“In the recent years our country’s investment in Indonesia was no longer dominated by labour intensive industries,” Lee, flanked by Councellor Yoon Moon-han, told ANTARA at his residence here on Monday.

Lee said that several South Korean companies had been operating in the business of machinaries, electronics, chemistry and expansion of natural resources processing, in addition to some existing labour intensive industries such as shoe, textile and wig industries.

Data issued by the South Korean Embassy showed that the country’s investment in Indonesia sharply rose to US$895 million in 2007 from us$320 million in 2002.

Regarding the balance of trade between the two countries, Indonesia enjoyed a US$3.3 billion surplus.

In 2007, Indonesia’s exports to South Korea reached US$9.110 billion, while the imports from South Korea reached only US$5.770 billion.

Some of Indonesia’s commodities exported to South Korea included LNG, coal, oil, forestry products, rubber, pulp and copper.

 As many as 1,200 South Korean companies operating in different sectors in Indonesia had absorbed more than 500,000 workers, he said, adding that 50 Memoranda of Understanding (MoUs) were signed since Desember 2006.

Data issued by the National Investment Coordinating Board (BKPM) showed that in 2007 South Korea was the third largest investor and the seventh largest investor in Indonesia in terms of investment realization and investment approval respectively.

Lee said further the bilateral relations have been improving, among other things by increasing exchange of visits by the two countries’ leaders and officials.

South Korean President Roh Moo-hyun visited Indonesia in December 2006, while Indonesian President Susilo Bambang Yudhoyono made a return visit to South Korea in July 2007. “The two countries’ leaders have a strong commitment to enhance their bilateral ties in several fields including politics, investment and trade,” the envoy said.

Jakarta and Seoul signed strategic and comprehensive agreements in 2006. “The strategic partnership agreement will become a basis for expansion of the relations between the two countries,” Lee noted. As a follow up of the agreement, the two countries have set minor committees, working groups and task forces in a bid to help improve the two countries’ business relations. Asked about obstacles to efforts to lure South Korean investors to Indonesia, Lee opined that the coordination between the central government and the regional administrations as well as easier licensing need to be promoted, while sustainable capacity building should also be conducted to create a conducive investment climate.

“Political stability should also be maintained,” Lee said, adding that his country was also ready to cooperate in military affairs, including in the joint manufacture of military arms and on exchange of visits of military personnel.

The Indonesian Navy is now also using Korean-built landing ship tanks (LSTs) and trucks.

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