Healthcare, education to be open for more foreign investment

Indonesia is inviting more foreign investment into the healthcare and
education sectors in a bid to improve services as well as the quality of
Indonesian human resources, according to Investment Coordinating Board
chairman Gita Wirjawan.
Speaking before U.S. businesspeople in Washington D.C. on Wednesday, Gita
revealed that the current negative list of investment limited foreign
hospitals in three cities, i.e. Jakarta, Surabaya in East Java and Medan in
North Sumatra.
"In the new negative list, we will remove such a limitation. Investors can
invest in any place they consider feasible," Gita told businesspeople here,
adding that the new negative list would be ready in the next one or two
months.
Foreign ownership in hospitals, meanwhile, would be capped at 67 percent.
In an interview with The Jakarta Post in New York on Thursday, Gita argued
that opening up the healthcare sector to foreign investment would benefit
customers more, with better services and prices because competition would
force even existing hospitals to improve services.
In addition, he said, having more foreign hospitals in the country would
eventually reduce the number of people going to hospitals overseas, and
therefore, it would save some foreign exchange.
"The value of foreign exchange that could be saved may be small, a few
hundreds US dollars a year, but we value more the benefits for our people,
i.e. better services and availability of alternatives, " Gita said.
In education, Gita explained that the government would try to attract
notable foreign universities to enter the country by establishing
cooperation with local universities.
He said that he would especially target foreign universities because
Indonesia is still lagging behind other countries in the region in tertiary
education.
"We are already good in basic education, i.e. elementary schools to high
schools. But we are still lacking in tertiary education and also vocational
schools," he said.
Foreign universities, however, cannot establish their own universities in
Indonesia because the national education law apparently did not allow
universities and schools to make profit.
Therefore, Gita suggested that they established a local legal entity that
could provide teachers, advisory services and even research facilities to
universities in Indonesia. That way, they could make money and recoup their
investment.
In addition to healthcare and education, Gita revealed that Indonesia would
also open its logistics and courier services to foreign participation,
arguing that this area is an important soft infrastructure for Indonesia to
move into the higher degree of economic development.
Foreign investors, however, are not allowed to take majority ownership in
this sector, except one company TNT which has already got a government
approval to take a 51 percent stake in a joint venture investment.

from: http://www.thejakar tapost.com/ news/2010/ 02/25/healthcare -education- be-open-m
ore-foreign- investment. html