Plenty of people, rich in resources
Indonesia, comprised of over 17,000 islands, is the largest country by area in Southeast Asia and is home to a wealth of land and ocean resources. Since the 1970s, mining and agriculture have accounted for tremendous quantities of exports, including natural gas, petroleum, copper, aluminum, and palm oil. While such products may have little in the way of added value, they have nonetheless earned Indonesia a significant amount of money.
Chou, who arrived in Indonesia 45 years ago, remembers how hard life there could be in the past; though ordinary folk could barely afford shoes, they still needed life’s necessities, a demand Taiwanese businesses were eager to satisfy. With the combination of a government that was opening up natural resources to foreign companies and the low cost of labor, these Taiwanese firms were thus able to get their collective foot in the door of a growing market.
The members of the Association of Southeast Asian Nations (ASEAN) have a total population of approximately 620 million, with Indonesia accounting for nearly 250 million of that. This massive market is a big part of why foreign investors are so interested in the country. And within that population, about 7% are ethnic Chinese, a not insignificant number of people.
“Indonesia is a great choice for Taiwanese businesses, because not only is there a sizable population of potential consumers, they also don’t discriminate against Chinese,” says Chou. He goes on to explain that investment opportunities there have been looking better and better by the year, especially as the economy has begun to really take off in recent years. Indonesia has begun to gradually transition from a hub for production and export to a market with impressive potential domestic demand, and with its lower wage rates, it is an excellent option for Taiwanese businesses being driven away from China by growing labor costs.
In recent years the Indonesian government has worked to address unfavorable conditions for foreign investment, making it quicker and more convenient, thus helping to spur basic infrastructure development.