The Business Environment in Asia Essay Example | Topics and Well Written Essays - 2750 words

The Business Environment in Asia - Essay Example The top 30 companies in Indonesia belonged to the Salim Group and to Suharto's children. After the recession, new family conglomerates entered the scene but the structure of the private sector did not undergo substantial change. The economy continues to boom and the family businesses benefit. In Indonesia, the state plays the most vital role in the growth of the business groups. Lobbying and corruption are prevalent in conducting business and due to their continued influence, businessmen become politicians (Mahmood, 2011). Large-scale towns in Indonesia have their own police and their own government including private taxation collection. All public facilities such as health, water, sewerage, and sanitation are controlled by this self-styled government in individual townships. The business has so much of political clout and influence that they are able to sustain opaque ownership pyramid structure which originates in some other nation and develops monopoly as in the case of Instant No odles that belongs to the Salim Group. Such a system has its own disadvantages and advantages. While it provides capital, infrastructure, and source of business talent and entrepreneurship, it creates moral hazard, ethnic tensions, and state capture.Importance of building relationships is critical to the success of business in Indonesia. Relationships with the government officials help in expediting the bureaucratic process. It helps in streamlining the applications for obtaining licenses, permits, and information.... Indonesia The top 30 companies in Indonesia belonged to the Salim Group and to Suharto’s children. After the recession new family conglomerates entered the scene but the structure of the private sector did not undergo substantial change. The economy continues to boom and the family businesses benefit. In Indonesia the state plays the most vital role in the growth of the business groups. Lobbying and corruption are prevalent in conducting business and due to their continued influence businessmen become politicians (Mahmood, 2011). Large scale towns in Indonesia have their own police and their own government including private taxation collection. All public facilities such as health, water, sewerage and sanitation are controlled by this self-styled government in individual townships. The business have so much of political clout and influence that they are able to sustain opaque ownership pyramid structure which originates in some other nation and develops monopoly as in the case of Instant Noodles that belongs to the Salim Group. Such a system has its own disadvantages and advantages. While it provides capital, infrastructure and source of business talent and entrepreneurship, it creates moral hazard, ethnic tensions and state capture. Importance of building relationships is critical to the success of business in Indonesia. Relationships with the government officials help in expediting the bureaucratic process. It helps in streamlining the applications for obtaining licenses, permits and information (Facing the Challenge, n.d.). The national officials or pegawai negeri such as the notary in Indonesia are treated with respect. Such initiatives have facilitated the