Foreign Ownership Rules to Be Clarified

KUALA LUMPUR ~ Indonesia is reviewing policies on foreign equity ownership in some sectors to enhance transparency and legal clarity in its investment regulations, top officials told a Malaysian business forum this week.

Indonesian Trade Minister Mari Pangestu said the review was being carried out following a new investment law which came into effect in April this year aiming to attract more foreign capital.

“The intention is part of implementing regulations of the new investment law … to make this new list (of sectors) more transparent and clear to investors,” she told reporters on the sidelines of the business forum here.

She said the new list would clarify sectors that were closed to foreigners as well as those which were open but subject to conditions.

President Susilo Bambang Yudhoyono told the same forum of Malaysian and Indonesian businessmen there would be “no drastic changes” to the regulations.

The country’s top economic minister, Budiono, has said the new investment law included equal treatment for domestic and foreign firms in some areas, and the right of foreign firms to seek redress through “binding” arbitration in cases of disputes with the government.

Pangestu said Indonesia would also introduce a new capital markets package aimed at making it easier for new companies to list on the country’s stock exchange.

Malaysia and Indonesia were in talks to implement a dual-listing system in which companies from both countries would be able to list on both exchanges, she said.

In a speech at the forum, Yudhoyono said trade between the two countries was at an all-time high, with Malaysian investments totaling US$2.2 billion in 2006, making it Indonesia’s largest foreign investor.

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