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Planting the seeds for Tarakan business
Published on: Sunday, December 17, 2017

WARUNG Teras is just like any ordinary restaurant. To any first-time visitor from Sabah, it can easily pass for one of the food outlets back home that serve Indonesian food.

On its green and white-painted walls are framed photographs of happy-looking guests who patronised the shop.

Anyone can guess they are well-known Indonesian personalities or important people.

Among the many photos is a large framed up group picture taken in March 2016 showing the seventh and current Indonesian President Joko Widodo with the owner and his family as well as the Governor of North Kalimantan, Dr H Irianto Lambrie.

Judging from its prominent display on the wall, the picture is a pride of the restaurant's Indonesian-Chinese owner.

It is not known if the picture of the President has been of any help to boost the restaurant's business.

But one thing is certain: Warung Teras is where many locals in Tarakan would recommend visitors to go to.

TripAdvisor reviews claim it serves "probably the best seafood in town" with the popular 'kapiting' (crabs) cooked in sauces among the top choices on the menu.

Although unlike any modern cafes that charge customers more than ordinary coffee shops, eating in Warung Teras is not as cheap as many might assume.

A plate of 'nasi goreng' (fried rice) seafood or 'nasi ayam penyet' (fried chicken dish served with sambal, slices of cucumbers, fried tofu and tempeh) or 'sop tulang' cost between Rp26,000 to Rp45,000, or RM8 to RM14 at the current 3.2 exchange rate. With drinks like fruit juices or even just a cup of black coffee, a customer would pay between Rp34,000 to Rp65,000 or RM10 to RM20 for one meal.

Prices are the same in other restaurants in Tarakan like one that is famous for its 'nasi padang', a steamed rice served with various choices of pre-cooked dishes originating from West Sumatra, Indonesia.

Sabahans always joked that they become instant millionaires whenever they go to Indonesia.

But even "millionaires" would find it a bit more expensive to eat in Warung Teras compared to when dining in Indonesian food outlet in Sabah.

There are cheaper options though. Stalls selling 'ayam bakar' or 'ikan bakar' along the streets cost less than Rp30,000.

If price of food at restaurants is indicative of the buying power of the community, Tarakan, or for that matter, North Kalimantan, speaks loudly about the island's fast-growing economy.

Some have said the middle class population in North Kalimantan is still small, and that the town is far less organised and less modern compared to Tawau, its closest neighbour on the Malaysian side.


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But behind current socio-economic reality and mere appearance hides Tarakan's huge potential in trade.

It takes experienced business people like Sabah-based Ooi Say Tuan to notice the hidden gems at first sight.

He is now looking at investing in North Kalimantan's well-established aquaculture industry in view of increasing demand for quality seafood in Sabah.

"Sabah's tourism industry is massive. So, certainly there's high demand for seafood products.

At the moment, we're short of products such as crabs which Tarakan has in abundance," he said.

It was reported that Sabah's import volume was RM800 million in 2015, mostly on live fry grouper, fresh fish, baby lobsters, live crabs, crab meat, fresh prawns, dry shrimps, cockles and dried seaweed.

Ooi, who is also planning to invest in warehouses in anticipation of the growing border trade activities and Bali cattle breeding, believes the demand will continue to rise along with the growth of the tourism industry.

"There's, in fact, so much we can do in North Kalimantan. As for myself, I have been doing this for decades," he added.

Representing his company Borneo Wood Dream Farm, Ooi was one of the 20-man delegation led by Society Empowerment and Economic Development (Seeds) from Sabah who signed a Memorandum of Understanding with North Kalimantan's Kamar Dagang and Industri (chamber of commerce and industry) of Kadin to explore various business potentials which will, in a bigger picture, mutually benefit Sabah and North Kalimantan economically.

Others from Sabah who also signed the MoU were the Chinese Chamber of Commerce Tawau (on forming business opportunity cooperation), Dewan Perniagaan Melayu Malaysia Sabah (on education business cooperation) and the Federation of Sabah Industries (on small and medium enterprise cooperation).

The signing ceremony took place at a sideline event during the BIMP-EAGA Ministerial Meeting in Tarakan, North Kalimantan, recently.

Another Sabahan businessman, Rolex Loh, sees Tarakan as his gateway to expand his children's toy empire and from there, hopefully in time, other parts of Kalimantan and the rest of the Indonesian archipelago.

It is common knowledge that trade activities in the border towns are actually nothing new.

Traditional trade activities, as they are called, have been around for centuries especially between Tawau and closest Indonesia neighbour, Sebatik and Nunukan.

But for the first time, Seeds, a Sabah-based non-governmental organisation, has set out to facilitate more structured approach by linking all stakeholders from government ministries and agencies to academics and business players in the hope of achieving a long-term goal, which is to create a greater Borneo market force of 24 million people.


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Seeds' initiative has been going on for a while and the recent MoU signing between Sabah businesses and Kadin is a small step closer towards the dream.

Its Chairman Datuk Badil Zaman is highly convinced that the future of Sabah's economic development lies down south.

"We are seriously promoting North Kalimantan because we believe it is a friendlier corridor for us to get into, for the simple reason that it is a new province and it's in the process of establishing itself with the rest of Indonesia," he said.

"This will give us opportunity to interface with its economic expansion."

He noted that it is the best time for Sabahans to work with their Indonesian close neighbours because under their current President, the government is focusing on developing the nation from 'pinggiran' or from its borders.

Badil, who has experience in developing new markets in countries like Vietnam, Cambodia, China and also Indonesia, believes that Sabah will have the economics of scale to make its Small and Medium Enterprises (SMEs) stronger because Kalimantan is a huge market of nearly 20 million people.

"We know that there's a more than 100-year-long history of trading between both sides.

Malaysia and Indonesia were not even in existence yet. But what we're doing now is to bring it to a level of the current business transaction that's more regulated.

"We have a political border and we need to address the policies of each country while at the same time preserve the trade relationship across the border that has existed for more than 100 years. It'll be a more structured approach," he explained.

The big challenge Seeds is facing right now, he said, is to convince the business community in Sabah to look at North Kalimantan more positively.

"I don't know how it came about but all this while we have a wrong perception about them.

We don't see them as an economic player.

"But what we don't realise is that they have surpassed us in so many ways. Take plantation for example.

They've overtaken us.

"There's no way we can even compete with them. We don't have the number and resources.


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But we can be their partner. After all, we also have what they need," added Badil.

There are suggestions that the more trade activities between Sabah and North Kalimantan, the better it is for consumers as prices will go down due to lower cost of doing business between close neighbours.

Until that happens, however, Sabahans 'millionaires' (the amount of Rupiah in their wallets) who visit Tarakan would still have to pay more than what they normally do in Sabah, in humble restaurants like Warung Teras. - Leonard Alaza

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