Singapore's Professional Services Centre Launches in Jakarta

As Singaporean businesses increasingly expand their operations abroad, a new Professional Services Centre (PSC) has been established in Jakarta to provide essential support. Launched on September 4, the PSC aims to connect companies with trusted lawyers, accountants, tax specialists, and other advisers, facilitating smoother navigation of the Indonesian market.

According to the Institute of Singapore Chartered Accountants council member Alan Chang, the PSC serves as a platform for businesses to address their challenges in Indonesia. He stated during the launch event attended by around 150 participants at Cyber 2 Tower that businesses should bring their problems to the PSC to start the conversation.

“Bring us your problems. Let (the PSC) make this conversation begin.”Alan Chang, Institute of Singapore Chartered Accountants

The Jakarta centre is part of a broader network that includes existing hubs in Singapore, Ho Chi Minh City, Nanjing, and Shanghai, with plans for future locations in Johor, Shenzhen, and Bangkok. This network has already facilitated over 90 business connections and supported 100 companies across various sectors.

On the Indonesian side, the PSC collaborates with several local partners, including the Indonesian Employers Association (Apindo) and the Singapore Chamber of Commerce Indonesia. Pheo Hutabarat, chairman of Kongres Advokat Indonesia (KAI), emphasized the importance of local expertise in addressing the legal uncertainties that often deter investors. He noted that differing interpretations of legal issues can create grey areas that may cause hesitation among potential investors.

Tax complexities also pose significant challenges for foreign businesses. Dennis Lui, CEO of the Tax Academy of Singapore, highlighted that understanding Indonesia's intricate tax system is crucial for structuring investments effectively. He remarked that the more important question is whether businesses can operate within that complexity with sufficient certainty and confidence. This need for clarity extends beyond initial market entry, as companies often require ongoing advice to adapt to changing regulations.

“The more important question is whether businesses can operate within that complexity with sufficient certainty and confidence.”Dennis Lui, CEO of the Tax Academy of Singapore

Ernie Koh, a council member of the Singapore Chinese Chamber of Commerce and Industry, shared his experience with the professional services network in Vietnam, indicating that such support is valuable not only for new entrants but also for established businesses navigating regulatory changes. His furniture manufacturing company, Koda, has been operating in Vietnam since 1993 and has benefited from professional guidance on issues like transfer pricing and tariffs.

Moreover, the PSC is expected to play a role in facilitating access to Indonesia's capital markets. Johanes Abimanyu, president director of the Indonesia Capital Market Institute (TICMI), noted that as companies seek new funding sources, there is a growing demand for capital market advice. TICMI aims to help private companies assess their readiness for public listings, leveraging the connections fostered through the PSC.

“It’s not only for those people that want to land in a foreign country, but also for those people that have already landed in a foreign country.”Ernie Koh, Singapore Chinese Chamber of Commerce and Industry

Abimanyu also pointed out that Indonesia's capital market has seen significant growth since the COVID-19 pandemic, particularly among younger investors. He believes that collaboration with Singapore can enhance Indonesia's capital market capabilities, especially in corporate governance practices.

As Singaporean firms continue to venture into Indonesia, the establishment of the PSC underscores the importance of professional networks in navigating the complexities of cross-border business operations. The initiative reflects a strategic move to bolster Singapore's position in the region while facilitating growth opportunities for both Singaporean and Indonesian companies.