Jakarta, April 19, 2010 – Once again Americans are looking at Indonesia as an investment destination. Boasting a 4.5 percent growth rate last year and expected to grow by 5.5-6 percent in 2010, Indonesia is reaping the rewards of good economic policy and responsible debt management. Earlier this month, the Organization for Economic Cooperation and Development (OECD) upgraded Indonesia’s country risk classification to level-four. This will allow the US Export-Import Bank (Ex-Im) and other leaders to lower their exposure fees by 20-25 percent, significantly reducing the cost of borrowing.

Here is more good news: last week the US and Indonesia signed an Overseas Private Investment Corporation (OPIC) agreement – an important signal that Indonesia welcomes foreign investment. This agreement makes available an additional US$1.4 billion in OPIC coverage for Indonesia in the form of financing, political risk insurance, and investment funds.

An Ex-Im Bank delegation arrived last week for the third trip to Indonesia in less than a year, to explore opportunities in the infrastructure, energy, and transportation sectors. And the US Trade and Development Agency’s most active portofolio in Southeast Asia is Indonesia, with projects ranging from geothermal power to aviation.

When US Secretary of Commerce Gary Locke visits Indonesia in May with a Clean Energy Mission, he will undescore just how ripe this sector – and Indonesia – is for investment. Regulations are being updated and streamlined in preparation for expansion of the country’s gethermal power generation capacity. Perusahaan Listrik Negara (PLN) recently finalized negotiations for the 340 MW Sarulla geothermal project in North Sumatra, a deal three years in the making. The Sarulla project is a perfect example of how Indonesia can realize its clean energy and energy security goals by partnering with international firms, in this case a consortium of Medco Energy International, Ormat International, and Itochu.

Indonesia is also making real efforts to increase accountability in its energy and resources sector by moving to become a candidate country in the Extractive Industries Transparency Initiative (EITI). EITI is a commitment to transparency on transactions involving natural resources. The EITI is currently awaiting President Yudhoyono’s signature, and once signed, will be one of the strongest commitments in the world.

Meanwhile, Indonesia is looking for opportunities to develop its creative industries, particularly the film sector. The producers of Eat, Pray, Love starring Julia Roberts, filmed on location in Bali last year. And the producers of the television show Survivor are considering Indonesia as the setting for the show’s upcoming seasons.

These developments mark the end of Hollywood’s reluctance to film in Indonesia. The advantages go beyond economic benefits; a thriving and more open film industry is an effective way to show the world that The Year of Living Dangerously is over, and that a new chapter of Indonesia’s history has begun.

Nor are opportunities limited to traditional business models. Nine Indonesian delegates will travel to Washington, DC in two weeks’ time for President Barack Obama’s Entrepreneurship Summit. This creative thinkers are examples of what can be achieved if the opportunities are there. And Indonesia has already expressed interest in hosting a regional follow-on Summit for the next generation of entrepreneurs.

Indonesia needs at least $140 billion in investment over the next five years to upgrade infrastructure and meet President Yudhoyono’s goal of 6-7 percent annual growth. Two-thirds of that funding will have to come from foreign investment. At last week’s Asia Pacific Ministerial Conference on Infrastructure, the Indonesian government put forward a number of major infrastructure projects, including toll roads and power plants. In the coming years, Indonesia will be looking for investment partners to meet other infrastructure needs through public-private partnerships. Amid these many signs of healthy economic growth and increasing stability, the timing couldn’t be better.

We will continue to work with our Indonesian colleagues to promote policies and programs that make Indonesia the first destination for serious American businesses. Indonesia is welcoming more international business, and the United States stands ready to be a partner.

Cameron R Hume, US Ambassador to Indonesia, wrote for The Jakarta Post.