Investment reaches US$7.3b in first semester

 Tuesday, 7 July 2009

The Jakarta Post

 Total investment of US$7.3 billion (inward and domestic) in the first semester indicated brighter prospects, although lower than figures for last year, the Investment Coordination Board (BKPM) says.

 BKPM chairman Muhammad Lutfi said Monday that the figure for inward investment was 27 percent up from that of the second semester last year, but  still 35 percent down compared to the same period in 2008.  

“BKPM hopes that the implementation of the one-stop service for the processing of investment licenses would further boost improvement in investment,” Lutfi  told reporters after signing an MoU  with the Indonesian Chambers of Commerce and Industry (Kadin) on business data sharing and on joint promotion of investment projects to attract investment from local and foreign investors.

 Lutfi was referring to a new government  policy and regulations simplifying the bureaucracy regarding investment licenses for local and foreign businesses,  in a bid to attract more investors into the country. These new policies would require further steps to implement transfers of authority from local government administrations to BKPM.

 BKPM data shows that foreign direct investment (FDI) in the first semester this year reached $5.39 billion, a drop of 48 percent compared to the same period last year. Yet, the number of FDI projects increased to 614 from 561 projects in the same period last year.

 According to Lutfi, the transportation, warehouse and telecommunication sectors recorded the highest FDI value at $1.2 billion.

 The value for chemicals and the pharmacy sectors is $958.4 million, followed by construction

sector at $481.4 million. Trade and service sectors accounted for $441.2 million, while metal, machinery, and electronics attacted  $306.5 million.   

 By country of origin, investors from The Netherlands invested the most at $1.1 billion, followed by Singapore with $793 million, and South Korea with $471 million.

 Domestic investment more than doubled to $1.9 billion compared to the same period last year.  The figure for domestic investment projects also increased to 134 projects from 107 projects in the same period last year. Lutfi said further that  the five top domestic investment sectors included chemicals, food and beverages, textiles, mining, and plantations.

 The contribution of actual domestic investment was 26.8 percent of the total investment secured in the first semester of  2009, increasing 8 percent  compared to the same semester last year.