14. There are four main cause problems to the conducive business climate 

in the region, the first is the condition of regional infrastructures and 

facilities as mostly stated by the foreign SME exporters, especially in 

Yogyakarta and Makassar.  The second is the competency of the 

regional government to undertake the task of regional autonomy, as 

mostly stated by the joint venture and comers (trading) SME exporter, 

especially in Medan and Bandar Lampung. The third, the regional 

government is against (anti) business as mostly stated by the non direct 

SME exporter, especially in Bandar Lampung and Medan. The forth, 

the central government were reluctant to transfer the authority to the 

Local government as mostly indicated by SME exporters in Makassar 

and Medan.   

15. The direct problems faced by the SME exporter in undertaking the 

export activities, were still due to the increase of production costs due 

to high local tax, levies and high cost to obtain business permit. 

Furthermore, the international non tariff barrier due to standard and 

quality problems, and mostly stated by the foreign SME exporter. 

16. The inadequate effort by local government to provide information and 

services regarding the business permit and licenses is seen by only 42 

percent of the SME exporter were aware either there are a One Stop 

Services is available in their area.  Furthermore, only 31 percent of the 

SME indicated that the One Stop Services have significantly help them 

in obtaining business permits. 

VI    6