Ricky R. P. Johnny, Marketing Manager, Panbil Industrial Estate
"Panbil is Indonesian company which opened in 1999. After several years of planning we opened this industrial park in 2001 and in 2002 a mall to take advantage of demand in the area. Then in 2003 we expanded into housing for both workers and expatriate managers as well as other people in Batam."
"Most tenants in our industrial park focus on light industry and electronics and semiconductors and the park comprises about 49% of our land. Philips came in 2008 and we e are now building our largest factory for Shimano, a Japanese bicycle manufacturer. There are also other companies from Singapore, Japan, Germany, the Netherlands, and Malaysia."
"Essentially all of the production is produced for export and altogether there are about 6,500 workers in the park from 20 companies, operating 56 factories. Most companies base manufacturing operations here as they are labor intensive so the can take advantage of the lower cost structure that comes with operating in Indonesia. Most of the companies that exist here have R+D and some other functions based in Singapore -- which is close by so they establish a factory here for more labor intensive functions due to our lower cost and FTZ status."
"Companies expanding into Batam have many options and even though our industrial park is almost full, we still attract a lot of interest from new firms as our park is one of the largest on the island and we can supply many support functions that are needed by investors. This includes providing self sufficient infrastructure, including our own power plant and water treatment facility. We also have an integrated town concept so we have industry, shopping and housing all self-contained. We have housing both for expatriates and local people as well so it is not limited to people working in the park. We are the developer and contractor of these properties and now have about 200 houses. In the mall we have many businesses including electronics and clothing stores, food courts and banks."
"We basically assist the companies from A to Z. Starting from their preliminary visit to the island we help them get established, and deal with a wide range of issues including immigration, manpower and the needs of the factory itself including helping them to develop their supply chains and logistics."
"Batam still remains a bit cheaper than other locations, In 2011 the minimum wage here for workers is about $125US a month. This excludes bonuses and incentives and overtime. We also can offer a strategic location near Singapore which is a big advantage. While consumption within ASEAN is rising quickly, most production here continues to be shipped to the US, Japan and Europe."
"We have great support by our local government including the Batam Indonesia Free Zone Authority (BIFZA) and Riau Islands Province as well as our local municipal government. We are also active and gain support from business associations as well as our central government and customs and the Port Authority. For example, they help us to obtain permits for our tentants, to facilitate their businesses and with out support to benefit from the integrated one-stop service unit which exists on Batam Island."
"Population and demands on infrastructure on Batam have grown over the years and in the future we need improvements in infrastructure, including roads and public transport could be improved. We also need more electricity capacity. In our case we have our own power plant and at the moment we supply excess production to the local utility, but the needs are growing as the numbers of workers rise on the island. Some form of mass transportation is also needed."
"Batam is also developing from a place where workers came for a few years into a home and local community and destination. This is likely to continue. If workers get paid more and get a good life here, they stay as there are many opportunities."