Mon, Oct 22, 2001 page19

• Security services in Indonesia doa roaring trade

  Bucking the trend of depressed business in the wake of terrorist attacks in the US, security firms are experiencing a boom

  • DPA
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  While Indonesia's tourism and export sectors have suffered from the nationwide anti-US protests sweeping the country this month, at least one industry is experiencing a mini-boom, office and home security providers, industry sources said.

  "If an investor wants to look into a security company right now, I'd say he wouldn't lose his money," said Glen Gardiner, a systems consultant at Sentinel Security Group.

  In fact, security services have been a growth industry for the past three to four years, as Indonesia experienced first a financial crisis in late 1997 followed by the deep recession of 1998, leading to the fall of former president Suharto the same year after 33 years of authoritarian, if somewhat secure, rule.

  With Suharto's fall there was a wave of rising political insecurity and violence, including attacks on Indonesian-Chinese communities, religious strife between Christian and Muslim communities and secessionist struggles in Aceh and elsewhere. The rising political and social unrest has already taken its toll on the resident foreign business community.

  Then came the Sept. 11 terrorist attacks on the World Trade Center in New York and the Pentagon building in Washington, far away from Indonesia but close enough to spark dangerous repercussions for US civilians in the world's most populous Muslim country -- at lease 180 million of Indonesia's 220 million people are followers of Islam.

  While the Indonesian government was quick to extend its condolences to the US victims of the terrorist attacks, a few militant Muslim groups were just as quick to warn the US of a serious backlash should it attack Afghanistan.

  One particularly vocal group -- the Front of Islamic Defense (FPI), promised to carry out "sweeps" against US residents in Indonesia, and even sent gangs to search hotels in Solo, central Java, for US tourists. None were found.

  Not surprisingly, the US and British embassies in Jakarta have issued travel warnings to their nationals since last month. The warnings seemed prudent after Oct.r 7, the launch day for US and British air and missile strikes on Afghanistan, which sparked off a wave of nationwide anti-US protests in Indonesia and more threats of "sweeps" against foreign residents. The US embassy had sent home its non-essential staff in the country the previous week. Some large US multinationals, such as Mattel and Nike, have also removed their expatriate staff. It's all been good news for local suppliers of security services.

  "We've seen a growth in the number of companies dusting off their evacuation plans, and calling us up for consultancy input," said Gardiner. With the threat of "sweeps," nearly all Jakarta-based securities services have reported a significant increase in business.

  "There has been an increase in demand for guards, mainly from expatriates but also from office buildings and housing estates," said Larus, a marketing manager for the Jaga Griya Jaguards Company.

  Nearly all well-to-do households in Jakarta, a city already somewhat notorious for its high crime rate, employ a "jaga," or "night watchman," but extreme times call for extreme measures.

  "People want to make sure they are paying for a guard who stays awake at night," said Gardiner, whose company claims to draw their guards "from the finest mold of clay."

  And the finer clay, obviously, costs more money than your normal household "jaga" who gets paid an average of 50,000 rupiah (US$50) a month.

  While it's all good news for Indonesia's security firms, the rising wave of expatriate jitters, has certainly not been good for the economy as a whole.

  An estimated 1.3 million foreign tourists have cancelled planned trips to Indonesia in the wake of nationwide anti-US protests this month, losing the country about US$1.1 billion in unrealized income, and exports orders to the US market for Indonesian textiles and other products have dropped off this month.

  Heightened security concerns, also adversely affect local investments and consumption, said James Castle, who heads the consultancy firm Castle Group and is the current chairman of the US Chamber of Commerce.

  "Companies and individuals spend more money making their houses and places of work safe and less money on improving their business and consuming products that can be the lifeblood of local demand," Castle wrote in a recent article published in Business Times newspaper of Singapore.
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