Over the past several months, I’ve been spending a lot of time in Jakarta. Partnering with Pertamina, Indonesia’s state-owned oil and natural gas business, we’re advancing a Joint Statement of Cooperation to develop Celanese’s proprietary technology to make fuel ethanol for use in Indonesia. I have also had the opportunity to get to know our other businesses there as well as we have a long history of doing business in Indonesia with our Acetate and our Acetyls businesses.
From where I stand, there are several reasons to be bullish on our future in Indonesia:
- It has a large, and growing, economy. The population is around 230 million and it is a relatively young population compared to other countries. Consumerism is growing and infrastructure is improving.
- The democratic government has made significant progress over the past few decades. It now ranks as the world’s 3rd largest democracy.
- It is Southeast Asia’s largest country and economy.
The Celanese teams continue to develop opportunities for even more growth in Indonesia – supporting our customers and their needs for our applications and solutions. But the road will be challenging.
While infrastructure is improving, the government still has relatively little funding to invest in it. One of the reasons for this is directly tied to our project in fuel ethanol. Because Indonesia has to import over 50% of its refined gasoline, the country spends approximately $12 billion per year to subsidize fuel so it can be more affordable for its citizens. Helping reduce the country’s dependency on imported energy is one of the key factors driving our project.
Another positive for Indonesia is that the government has increased its emphasis on eliminating the political and business corruption that has plagued the country for decades. As a U.S. corporation, and consistent with our corporate values, we are committed to always being compliant with the Foreign Corrupt Practices Act (FCPA), which prohibits, among other items, bribery and other illegal payments. Happily, every time I visit I see many successful multi-nationals in Indonesia that work effectively in this same environment.
On my last visit, I met with Scot Marcial, the U.S. Ambassador to Indonesia since 2010. When I asked him for his advice on how to be successful in Indonesia, he said “Be patient. Be persistent. And have a sense of humor.”
This sounds like pretty good advice for us wherever our business travels may take us.