S'pore SMEs headed for Indonesia

Bread Talk, Apex rolling out plans; Enzer hopes to tap high-end market

FOLLOWING in the footsteps of Singapore government-linked companies, which have invested US$3.3 billion in Indonesia in the past two years, Singapore's small and medium-sized enterprises are now exploring opportunities in the country's fast-expanding consumer and retail sectors.

As part of Network Indonesia, which was officially launched by Trade and Industry Minister George Yeo last night, 128 executives representing 92 Singapore-based SMEs will spend two days here sourcing ideas and business partners. The SMEs are involved in sectors ranging from food to jewellery to high-end home entertainment systems.

In his keynote address, BG Yeo said Network Indonesia can help Singapore businessmen navigate a complex environment by finding them good Indonesian partners.

'The Singapore businessmen who have come for this evening's launch are not only interested in established areas like electronics, energy and industrial parks but also in sectors like retail, agriculture and business services,' he said.

He revealed that two Singapore SMEs in the food retail sector - Bread Talk and Apex-Pal - are looking to tap the middle-class market in Indonesia, which has been growing strongly.

Bread Talk has just opened its first outlet in Jakarta while Apex-Pal, with its Sakae Sushi Japanese fast-food concept, will roll out a chain of outlets.

'Network Indonesia follows Network China and Network India,' said BG Yeo. 'It is the first network we have formed in South-east Asia, and as Indonesia is a large country, we may have to form sub-groups as well in the future.'

He said Network Indonesia will also complement and contribute to bilateral relations, and at a time 'when our region faces great challenges form terrorism and the Sars epidemic, it is even more important for Singapore and Indonesia to work together to revive investor confidence in the region'.

Boyd Au, executive chairman of listed Enzer Corporation, told BT he is looking to open an outlet in Jakarta soon. Enzer, which sells high-end home theatre systems, views Indonesia, with its large and wealthy middle class, as a lucrative market. 'It is a super huge market and we can open a retail outlet here, whereas in China, foreigners are not allowed to enter the retail market,' Mr Au said.

Semitech Electronics president and chief executive officer Lawrence Lee said Indonesia offers greater opportunities than China. 'For Singapore businesses, the best places to do business are Malaysia and Indonesia,' he said. 'Both in terms of language and geography, it is easier to do business here.'

The chief executive officer of International Enterprise (IE) Singapore, Lee Yi Shyan, said the delegation to Indonesia is one of the largest and widest-ranging IE has led. The size of the delegation reflects the growing confidence that Singapore-based businessmen have in Indonesia, he said.

Asked about the timing of the visit, given uncertainty surrounding next year's general election in Indonesia, Mr Lee said Singapore businesses are taking a strategic view of the opportunities in the country, and despite the high risk premium, there is money to be made.

'Indonesia is a vast hinterland for Singapore businesses,' he said at a news conference. 'They have familiarity for doing business here and Singapore businessmen will not discount the potential for doing business here just because of the coming elections.'

The chairman of Network Indonesia's steering committee, Tony Chew, said now that initial contacts have been made and the concept officially launched, more business delegations will follow.

Network Indonesia will set the agenda and a strategic direction for its members and help them identify opportunities when they arise, he said