Robert Go, Batam – Foreign investors yesterday signalled to the Indonesian government that they wanted a more concrete reform process in place before they could become confident about increasing investments in the country.

Their comments followed a speech by Vice-President Megawati Sukarnoputri, who pledged a quick resolution to the political crisis and assured them that Jakarta would be more business-friendly. Advertisement "It serves our own interests that we should be able to find a way out as soon as possible from this uncertainty-laden situation," she said.

"If today I were able to solve the various problems facing us, and to make available other means required for tranquility and smooth flow of business activities, I would certainly make them available."

Several foreign businessmen attending the Confederation of Asia Pacific Chambers of Commerce and Industry meetings in Batam welcomed her optimism. But they suggested that clear reforms and extended stability would be better for enticing investors back to Indonesia.

Mr DH Pai Panandikar, president of the RPG Foundation, an Indian energy sector business group worth US$2 billion, said: "Megawati's speech failed to bring out a clear picture of how the government intends to deal with the crisis. The present government still doesn't seem to have a good approach to reforms."

Ms Sabariah Sulaiman, honorary secretary of the Singapore Malay Chamber of Commerce & Industry, agreed. "She showed lots of confidence and seems to be capable of leadership, but we expected more assurances about the future business climate," she said.

"Indonesia doesn't have to clean the entire house, but some reforms are in order." Mr Suhaimi Salleh, chief executive of the SSA Consulting Group in Singapore, argued that despite several improvements in Indonesia's economy during the past year, the process of restoring confidence would take years. "People are still fearful of investing here because of the political climate and lack of progress on reforms," he said.

Indonesia received US$33.8 billion in foreign direct investment in 1997, but only US$10.9 billion in 1999. This rose to US$15.4 billion last year. But figures for the first quarter of this year – only US$3 billion – already projected a slowing down from last year's positive trend.