The Challenge to American Corporate Investment in Indonesia

TLDR: In this paper, the authors analyze the investment climate in Indonesia and conclude that the benefits far outweigh the costs and that in investing in Indonesia, American investors can both conduct profitable business ventures and help to further stabilize the vital area of Southeast Asia, politically and economically.

Abstract: T he purpose of this study is to analyze the investment climate in Indonesia. Under consideration here are such important factors as the attitude of the present leadership under General Suharto; the legacy of the Sukarno regime with which he and his cabinet must deal; the obstacles, limitations, and advantages for foreign investment, including the legal aspects of investment and economic development; and an analysis of the Investment Law of 1967, which clearly enumerates the conditions, incentives, restrictions, and safeguards for foreign investment. In compiling the data for this report I have become convinced that Indonesia is a country which will play an increasingly important role in the Pacific in years to come. The present leadership, unlike its predecessor, firmly believes in the necessity for economic growth and stabilization and the concomitant importance of encouraging foreign capital investment in Indonesia. There are currently enormous problems to be met in the task of developing Indonesia's potential, but it is my intent to demonstrate that the benefits far outweigh the costs and that in investing in Indonesia, American investors can both conduct profitable business ventures and help to further stabilize the vital area of Southeast Asia, politically and economically. With rational and understanding policies, investment and development in Indonesia should prove to be rapid and profitable. This will require patience, optimism and perseverance, but the results should certainly merit the time and energies spent. American and other foreign investors must keep in mind, however, that all developing nations are demanding operations of mutual benefit. A company