[LINK] "US, China vie for influence among Indonesian riches"

[rfmcdonald]

At Asia Times Online, Sara Schonhardt describes how the promise of Indonesia--an emerging economy I've blogged about before, one that many say should be considered for BRIC membership (BRICS now) on account of its size and development--is encouraging Sino-American competition for access to Indonesian markets and resources.

The battle for influence between the world's economic powerhouses, China and the United States, is intensifying across Southeast Asia. Both countries are rushing to take advantage of robust growth rates and rising consumer demand, and the focus of their recent competition is the region's emerging gem: Indonesia.

The country was practically wiped from investors' sights after the 1997-98 Asian financial crisis, when the national coffers ran dry and the currency collapsed. But annual growth of around 6%, a middle class of nearly 30 million and a long period of political stability have made it a darling among businesses eager to gain influence and market share.

As Southeast Asia's largest economy and the world's biggest supplier of coal and palm oil, investors have recently plowed into the country as a play on rising commodity prices. More recently, foreign businesses, including from the US and China, have seen the benefits of selling to Indonesia's large and expanding middle class, providing a new boost to manufacturing after falling off steadily since the late 1990s.

"Southeast Asia is in China's backyard," said James Castle, the founder of corporate advisor Castle Asia and one of the leading market-entry strategists in Indonesia. It's natural that the Chinese would want to spread their technological and economic strengths beyond their borders, he said.

The US, meanwhile, is vying for a slice of the pie by promoting technology-sharing deals and investments in commodities and renewable energy.

Go, read the whole thing.