The East Asia economic crisis that was started in mid 1997 had significant impact on Indonesian economy. The rupiah devalued by about 80% and interest rate soared to 60%

In our GFP, we analyze the impact of the crisis on the survival of a multifinance company, PT XYZ. Company business is mostly providing financial leases of heavy equipment and industrial machinery to companies doing business in manufacturing, construction, trade, timber, and others.

In the analysis, we monitor cash flows, outstanding receivables, and financial risk management. The management of PT XYZ manages the survival of the company well by avoiding new contracts, managing existing contracts (emphasizing on collection and performing assets repossession for trouble accounts), cutting costs, managing loans, and putting excess cash in bank deposits.

From published articles, we also studied the expected future situation after the crisis that the company will face. Many MNCs will come and do business in Indonesia, including multifinance sector. Future investments are expected to be better distributed all over Indonesia. A strategy is developed, and recommendations and action plan are given for PT XYZ to survive the present crisis and to perform better and expand after the crisis is over.



Research Location: PT. XYZ ( Multinational Co.)

Supervisor: Roy Sembel, Ph.D

Accepted: 18 December 1998



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