Interview: Hugo Swire
How can the UK capitalise on the potential Indonesia holds to create more business opportunities for British companies?
HUGO SWIRE: Understanding of the business opportunities available in Indonesia is growing. Major British companies have been aware for a long time, but small and medium-sized enterprises are also starting to pick up on this. To access these opportunities and succeed in Indonesia, UK companies need to invest time and resources in building strong relationships with their Indonesian counterparts. Many sectors are thriving but we see particular opportunities in infrastructure, energy and aerospace.
What are the biggest constraints currently on bilateral trade between the two countries?
SWIRE: One challenge has been regulation and red tape but I am pleased to see that the president, Joko Widodo, is prioritising improvements to Indonesia’s business environment. The UK is sharing our experience of regulatory reform through Better Regulation Delivery Office experts. On the British side, I would say the biggest factor holding us back is simply a lack of knowledge about the numerous business opportunities Indonesia has to offer. We are working to address this with our Indonesian counterparts and a great deal of progress has already been made.
Which sectors do you think hold the greatest potential for more investment from the UK?
SWIRE: It has to be the Indonesian energy sector. The government of Indonesia’s goal of increasing power production offers huge potential in this area. The UK already has substantial investment from large companies but other UK energy companies, including renewable energy specialists, are also based in Indonesia and want to build on this.
Other sectors with strong potential include telecoms and finance, particularly Islamic finance.
How can Indonesia take advantage of UK expertise in the infrastructure and energy sectors?
SWIRE: On infrastructure, British consultancy firms lead the world in providing reliable, top-class advice to project owners. UK companies are also keen to work on Asian Games sports infrastructure projects, bringing their knowledge and capabilities to help deliver the games. There is strong Indonesian interest in learning from UK expertise in public-private partnerships. In terms of energy, companies like Shell and Global Energy Group, and their supply chains, are supporting Indonesia’s ambition by adding generative capacity, helping identify new sources of energy, such as tidal, and establishing networks to link these new power sources to people.
What specific measures might help Indonesia improve both its visibility and its attractiveness for foreign direct investment (FDI) from the UK?
SWIRE: Promotional activities to increase UK public awareness and interest in Indonesia are important. Tourism and cultural promotions can complement activities that are more directly focused on business. Our embassy, the British Council and the British Chamber of Commerce in Jakarta are working with Indonesian organisations to raise awareness through the Indonesia Matters campaign. Along with UK Trade and Investment, we help to connect UK and Indonesian companies for trade and investment, with business missions in both directions.
Attracting FDI is very competitive, and the UK has a strong record based on our open approach to trade and investment, and removing barriers. Indonesian officials have been keen to learn how we do this. The latest revisions to the Indonesia Negative Investment List will help to open up the country to increased FDI, and I would particularly encourage more majority ownership. I am proud that the UK is supporting this focus on reducing and simplifying regulation.
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