Tuesday, January 15, 2013

More of the same

Taking a brief look back at my old stomping grounds, I see not much has changed in Indonesia. Good governance is as fleeting as ever, with cheap and easy populism filling the (many) gaps left by the absence of real, decisive leadership. Multinational corporations say the investment and business climate in Indonesia is increasingly hostile and, with incidents like government ministers trying to dictate private firms' activities and state-owned enterprises hoovering up what's left over when foreign companies get chased off, it's hard to argue.
Having been the darling of foreign investors and business pundits for the past couple of years, Indonesia is now finding that some of its biggest and longest-term investors, especially in the energy sector, are growing fed up with policy shifts and the climate of hostility toward multinational companies.

With the mining and energy minister having said recently that ExxonMobil's local CEO would be turfed out of the country over a stalled asset sale, executives say they are confused and worried over the future here and are concerned about speaking out for fear they will be forced to follow him out.

The growing intimidation of multinationals operating in the country prompted Chevron Indonesia Thursday to warn the nation's interim upstream oil and gas regulator that the deteriorating investment climate could lead to lower future investment by the company, which has been operating in Indonesia since 1952 and is the country's largest oil and gas producer.
It's nationalistic behavior like this that sees business stories about the big picture in Indonesia listing almost as many caveats as reasons for optimism.

Not to be outdone, Indonesia's soccer shemozzle continues unabated. The country's favorite sport has been in turmoil for more than two years as rival factions jostle for control, paying little heed to the steady downward trend of Indonesia's success in Asian and international competition. The latest twist is that the newly installed youth and sports minister has threatened to disband both rival factions if they fail to meet FIFA's latest toothless deadline.
Soccer in the southeast Asian country has been long plagued by infighting between the Indonesian Soccer Association (PSSI) and the breakaway Indonesian Soccer Rescue Committee (KPSI), with FIFA threatening to suspend them if the dispute was not resolved by Dec. 10.
But Indonesia somehow dodged a ban and were given a three month extension to resolve the fight for power after emergency talks involving soccer's world governing body and the Asian Football Confederation.
Roy Suriyo, who was appointed as the country's new youth and sports minister on Tuesday, was confident of solving the bitter feud before the FIFA deadline, the Jakarta Globe said in a report.
"FIFA has given us a deadline of March 16. So, we have to solve the problems by then," Suriyo told the newspaper. "I have neither interests nor attachment to the ... PSSI and KPSI. So, God willing, I will solve it."
Looks like Roy already has a good grasp of public grandstanding, one of the most crucial skills for any Indonesian official. Much like predecessors Andi Mallarangeng -- who left the job in December while being investigated for corruption -- and Adhyaksa Dault, the new guy is in the job far more for his connections to President Susilo Bambang Yudhoyono's Democratic Party than his ability with youth or sports.

Don't expect much to change under Roy's watch. The PSSI and KPSI -- not to mention their respective sugar daddies -- have deep divisions that extend far beyond the sporting arena. If either side had the best interests of the sport or the Indonesian people in mind, they would have come to the table and worked out a deal long ago. Instead, the status quo will remain firmly in place. FIFA has shown no interest in forcing the issue in Indonesia, but rest assured it will ride in with guns blazing should Roy or SBY do anything that resembles "government interference." Of course, if you ask some people, that might all be for the best.

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