South Sulawesi Benefits from Japanese Connection


Citing his own experience as the regent of Bantaeng for 10 years, newly elected South Sulawesi Governor Nurdin Abdullah strongly believes that his many Japanese connections will be very helpful in realizing his ambition to boost the province’s position as a key agribusiness hub for Indonesia.

The academic-turned-politician said that when he served as the regent of the tiny regency until August last year, many Japanese companies came to invest there and government agencies also gave technical assistance and grants to develop the regency.

He learned much from Japanese development policies at a regional level during a six-year stay in the country. Apart from completing his academic obligations, he also spent his six years in Japan building networks with the country’s parliament, government and businesses, which he maintains until today and which have been fruitful during his public service.

“When I was the Bantaeng regent, my Japanese network provided us with ambulances, firetrucks, garbage trucks, hospitals, and equipment. We didn’t need to allocate our budget for those things. They came to me and offered their help,” Nurdin said.

Nurdin became governor in September last year after serving Bantaeng for 10 years. He obtained his master’s degree from Kyushu Agriculture University in 1991, and his doctorate degree from the same university in 1994. During the Asian financial crisis in 1998, a Japanese company gave him US$2.5 million to build a furniture firm, Maruki International Indonesia, in Makassar.

“The Japanese company trusted very much in developing the company. As you know trust is very important for Japanese people,” said Nurdin in a recent interview with The Jakarta Post in Jakarta.

The governor is committed to taking steps to provide all necessary facilities to attract more investment, as the region is set to expand its agriculture sector and develop new economic hubs outside of its capital of Makassar.

As part of its efforts to get more investors, the province inaugurated its first public service mall, which offers one-stop services, in Polopo this month.

“We are simplifying the licensing processes that have hindered investment in the province. If necessary, I’ve even told the investors to proceed with the construction while we processed the permits,” he said.

According to the Indonesia Investment Coordinating Board (BKPM) total direct foreign investment (FDI) realization in the province stood at $617 million last year, slightly behind Central and Southeast Sulawesi.

Nurdin is optimistic that the province will secure more foreign investment given the promising potential of its agriculture, plantations, fisheries and animal husbandry sectors, in addition to its vast and economical land reserves. South Sulawesi is known as one of Indonesia’s main rice suppliers and cocoa exporters.

His office will adopt Japan’s michi-no-iki supermarkets—stores that are run by local farmers and communities, and also sell local products. A team of officials from Japan’s Infrastructure Ministry visited Bantaeng earlier this month, where the administration plans to build its pilot stores.

“We should convince farmers that the agriculture sector can provide welfare for them. Our farmers’ quality products are sold in supermarkets and come in good packaging, but the farmers only get paid three months later. As their cash flow is disrupted, they tend to resort to loan sharks,” he said.

Nurdin added that Japanese trading company Marubeni Corporation had expressed an interest in the region’s agriculture sector, although he did not elaborate further as it is still under review. Nurdin said some Japanese companies had also shown interest in investing in the province’s infrastructure projects. Marubeni was among the companies, he said, with its sights set on the toll road project expected to connect Makassar and industrial points in the region. Another project is the light rail transit (LRT), which is still at the stage of feasibility studies, he said.

“I have told Marubeni that my administration wants to focus on increasing farmers’ production and markets,” he said.

In 2016, the Bantaeng administration and the Ehime Toyota Motors Corp. inaugurated a vocational training center (BLK) to develop automotive technicians for the company. Earlier this year, South Sulawesi officially paired with Ehime prefecture.

Insufficient infrastructure remains a problem in the region—which comprises 24 cities and regencies. Nurdin said focusing on infrastructure would help boost the region’s economy and improve its Gini ratio, which stood at 0.388 as of September 2018, slightly higher than the central government’s target of 0.385.

To promote equality between regions, the administration is planning to enhance economic activities in cities or regencies outside Makassar.

“We are designing new economic hubs in southern and northern parts of the province,” he said.

A new economic hub currently in the works is in Takalar regency, which is located in the southern part of the province. The administration is joining hands with state-owned industrial bonded zone Kawasan Berikat Nusantara (KBN), several Chinese investors and the China Metalling Recycling Association (CMRA) to build the industrial zone, expected to be completed in 2020.

“We have provided the land, and we will build the biggest recycling company in Southeast Asia there. The company will provide supplies to the automotive industry among others. We will also build an oil refinery there,” he said.

Approximately 50 businesses will be built in the 1,000-hectare zone, with 15,000 workers expected to be employed.

“Hopefully, once this is completed, people won’t have to travel to Makassar to work,” Nurdin said.