Riau governor seeks investors for undeveloped islands

Fadli, The Jakarta Post, Batam

The Riau Islands provincial administration has offered the Haj Fund Board of Malaysia the opportunity to lease one of its islands for development.

Riau Islands Governor Ismeth Abdullah made the offer Monday to Minister in the Department of the Prime Minister Abdullah Mohammad Zein, during a ceremony to mark the opening of the fund board's first palm oil refinery in Batam.

The new refinery will allow the fund board to enter the Chinese market, Malaysia's top palm oil buyer for the past several years at more than two million tons annually.

The Haj Fund Board of Malaysia, or Lembaga Tabung Haji, owns oil palm estates in Malaysia and Indonesia, as well as teak plantations in Sabah and Sarawak, totaling about 129,663 hectares, according to Business Times.

"If interested Tabung Haji can lease one of the islands in Riau Islands for business development. There are many islands in Riau Islands province and they have the potential for the development of tourism and other businesses," Ismeth said.

Ismeth said Tabung Haji had the financial clout to properly develop an island.

"Indonesia should learn from Tabung Haji Malaysia. Why doesn't Indonesia, which sends up to 190,000 pilgrims on the haj annually, have any haj funds like Malaysia. We need to answer this question."

The governor said the ability of Tabung Haji to build a refinery in Batam with an investment of up to US$15.5 million was an impressive achievement for the fund.

Responding to the offer, Abullah Mohammad Zein said the proposal was interesting and he would look into it.

"If leasing an island is possible for business development, we will possibly do it. This is a good offer."

Ismeth said if Tabung Haji invested in an island in the province, it would have a multiplier effect on the investment climate in Riau Islands and encourage similar institutions to follow suit.

According to data from the provincial administration, there are at least 2,408 islands in Riau Island province, located in four regencies and two mayoralties. Nearly 40 percent are unoccupied and have not been officially named.

Ismeth also said Tabung Haji planned to build a residential complex in Batam for workers at companies owned by the fund.
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