“ Indonesia has 33 provinces, each with its own set of unique attributes. I definitely see the immense potential in selling this to global consumers and we certainly can no longer have our country rely on depleting commodities. ”
Arion Paramita Group was founded by my late father who started with a venture in the transportation business. I myself am part of the second generation of my family to run the company and have since developed it into a diversified group with investments in hotels and property, while still maintaining our transportation operations. The decision to go into these new sectors came 20 years ago as I predicted that in the future, the transportation sector will be a very challenging industry to be involved in. This turned out to be the case as even now we can often witness the rocky relationship between operators and regulators, not to mention labour and regulation issues. Of course, undertaking a new line of business never comes easy; especially at that time, we were only recognised as a transportation company. Overall, although it was the starting point for the group, the second generation wanted to avoid transportation becoming our core business. Hence, we diversified.
At present, we continue to focus on the property sector. We have several points serving as the basis for this decision, but the main reason is that Indonesia as a large country with a very large population will surely continue to have demand for housing and other types of property. Indeed, the prospects are still enormous, even if present achievements do not reflect this. Though our economy is currently already performing better than most of Asia, in my opinion, it is still below the rate it should be. In terms of plans for the future, the next step for Arion Paramita Group is to become a publicly-traded company in order to further develop beyond its current capacity. We are waiting for the right moment and are carrying out the necessary preparations in order to achieve that objective.
I can say that President Joko Widodo has introduced good measures and I foresee that he will open vast opportunities for businesses in Indonesia. Four our group, the most prospective sector is tourism. Indonesia has 33 provinces, each with its own set of unique attributes. I definitely see the immense potential in selling this to global consumers and we certainly can no longer have our country rely on depleting commodities such as oil or coal to support its economy. This optimism for the prospects of Indonesian tourism is also the basis for our inclination to concentrate on that sector.
Among these 33 provinces, several regions in particular are more prospective than others. The eastern part of Indonesia is currently undergoing development as its opportunities have finally been recognised by the government. Such is also the instance with the North Sumatra province. President Joko Widodo is accelerating infrastructure development in those regions. In the past, the previous government's attention was excessively given to the islands of Java and Bali, which is unfortunate as there were also hidden gems such as the North Sulawesi province or the Raja Ampat Islands in Papua. As a result, investors who were interested in these regions were met with infrastructure and human resources inadequacies. Based on my experience, one example of an area that needs reform is the number of different permits that are required just to open a hotel. The government should streamline its regulations so as to not discourage or impede investors.
We cannot continue to be unreasonable in this matter and should take example from Australia where Indonesians have been buying up property there. Moreover, the Australian market also offers lower interest rates and longer credit terms, with Singapore being another good example. Indonesia needs to catch up in this regard
I see the ASEAN Economic Community as a positive development and it should spur trade between member countries. I also see the need to strengthen the foundation of our business in taking on new competition from our neighbours. Our present strategy comprises of continuously expanding our market, developing our human resources, and acquiring more capital as required. Arion Paramita Group has a 10:1 total asset to debt ratio and expansions are carried out in a conservative manner. We will continue to build new hotels in prospective tourism destinations as I consider these and other property projects as safe assets.
We welcome all partnership possibilities so long as it is mutually beneficial to all parties involved. Whether a prospective partner is local or foreign is inconsequential, we are open. I should say that we particularly seek technology transfer opportunities rather than capital contribution because we are definitely behind in that domain and our counterparts from abroad will likely have something to offer. The partner for this type of cooperation should have a proven capacity in regards to technological expertise or other knowledge. Furthermore, the best synergy should combine our corporate vision, mission and culture with those of our partner’s.
In the business world, we must be able to read the situation for ourselves and become a pioneer rather than a follower who trails behind what everyone else is doing. As an entrepreneur, it is important to be able to recognise momentum; such as with what is going on in the market, the country’s economic trend, and business opportunities by watching closely at what exactly do consumers need.