Govt should not worry about capital flight, says observer

Jakarta (Antara News) - The Indonesian government should not worry about foreign capital flight as many factors in Inonesia were still attractive to foreign investors, an observer said.

"Both local and foreign investors will not easily move their money to other countries because they certainly have many considerations before relocating their business to elsewehere," Standard Chartered Bank economic observer Fauzi Icshan said here Monday.

He noted that Indonesia was afraid that a Singaporean government`s plan to scrap tax on company dividends would trigger capital in Indonesia to flee to the neighboring country.

The government, Fauzi said, should find ways to improve the country`s competitive edge and encourage foreign investors to remain loyal to Indonesia`s domestic markets.

Indonesia, he said, was still an interesting place for foreign investors as it was still offering a high interest rate and had an undervalued stock market. (*)
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