KUALA LUMPUR, May 28 (Reuters) - Indonesia is reviewing
foreign ownership rules in its telecoms industry, the country's
trade minister said on Monday, amid speculation that the
government wanted to tighten restrictions.
Indonesia currently allows foreigners to own up to 95
percent of a local telecoms firm, Trade Minister Mari Pangestu
told a business forum in Kuala Lumpur. This is a much more
generous limit than in many other other Asian countries.
Asked if the restrictions would be tightened, Pangestu told
reporters: "It is still being reviewed. It's better to ask the
telecommunications minister."
Debate had turned to foreign ownership after an executive
from Malaysian phone firm Maxis Communications asked
about rumours that the limit would be reduced. Maxis owns 95
percent of Indonesia's Natrindo.
Indonesian President Susilo Bambang Yudhoyono, who also
took part in the round table, did not answer the question
directly but said there would be no sudden changes in telecoms
policy.
"We will not make dramatic, abrupt changes without
explaining to our partners," he said.
Later, when questioned by reporters, Pangestu said
Indonesia was working on a new investment law that would, among
other things, spell out foreign shareholding limits and other
conditions in various industrial sectors, including telecoms.
"The intention is to make this new list more transparent
and clear to investors in general," she said. "Each sector has
come out with its recommendations."
"With the new investment law, we are coming out with a new
list. Telecommunications will be under the new list. We are
still finalising that list," she added.
Pangestu said some sectors would be closed to foreign
investors following the review, the first since 1994.
"There are some (sectors) that will be more open," she
added, without elaborating.
She said the new list would be a boon to investors.
"It's more transparent, it has greater legal certainty and
the criteria are very clear. The criteria will really be on
national interests."
Indonesia has seen an influx of foreign telecommunication
companies such as Hutchison Whampoa Ltd and Singapore
Telecommunications Ltd .
Most firms are involved in the mobile phone sector. The
number of cellular phone subscribers has risen sharply in
recent years and is expected by analysts to top 100 million by
2010 from some 70 million now.
Indonesia's diversified SETDCO Group plans to bid for a 35
percent stake in the country's largest mobile phone operator,
PT Telekomunikasi Selular (Telkomsel), its chairman had said.
Setiawan Djodi, chairman of the privately owned SETDCO
Group, which has business interests ranging from oil and gas to
shipping, said the company wanted to buy SingTel's stake for
$1.6 billion.
The telecoms arm of Russia's Alfa Group conglomerate,
Altimo, had said it plans to invest $2 billion in Indonesia's
telecommunications sector.
Telekom Malaysia has a controlling stake in
Indonesia's third-largest mobile phone operator, PT
Excelcomindo Pratama Tbk .
(Additional reporting by Harry Suhartono in Jakarta)
