Foreign Direct Investment and its benefits for Indonesia in more conducive climate to investment

Indonesia's regulatory framework has become more conducive to investment. Correction to the country's complex webs of bureaucratic red tape and licenses will help strengthen the formal economy. When it has been done, Foreign Direct Investment (FDI) can have significant spillover benefits for Indonesia in terms of improved productivity, technology, and management practices. It can be a powerful force for growth and reform in Indonesia. Now is the time to harness its potential.

The Chairman of APINDO, Hariyadi B. Sukamdani stated the new government is optimist in pursuing its ambition to achieve 7% in average economic growth target within 5 years leadership of the new government of Joko Widodo- Jusuf Kalla. BPS reported that Indonesia's economic growth in the first quarter of 2015 is 4.71%. In achieving its target, the government has been focusing on infrastructure development. However, there is challenge for the government to pursue its ambitious infrastructure projects due to the need for massive financing resources is going beyond its financing capacity. "However, this challenge could be seen as investment opportunity for business community to engange in Public-Private Partnership," he uttered.

Hariyadi also mentioned that the Indonesia's economy has directed to have these high level of FDI. On the positive outlook, rating agency has upgraded Indonesia's credit ranking this year.

"Indonesia has come a long way from the net outflow of FDI as it incurred after the Asian financial crisis. Some of the most sought-after investor nations such as Singapore, Japan, the United States, South Korea, and the Netherland are among its largest investors today," Hariyadi said.

Furthermore, he stated that in line with the government's economic growth target and APINDO's recommendations to the new presidency through Economic Roadmap for creating three million decent jobs per year within 2014 - 2019, APINDO aware of the importance of international strategic partnership program. "The cooperation is directed to transform APINDO's vast national and international network into a strategic partnership between local and international business players by creating business that provide decent jobs in Indonesia," Hariyadi said.

In order to establish international strategic partnership, APINDO Chairwomen for International Relations and Investment, Shinta W. Kamdani on behalf of the association launches the International Partnership Service Center (IPSC) to facilitate domestic and foreign companies to have strategic networking and business matchmaking activities, as well as being catalysts to trade and investment process. "IPSC significantly establishes strategic partnership among national and international business players, including creating conducive, accountable, and competitive business climate that will boost investment to the country," she added.

Shinta stated that IPSC provides several services to investors related to Market Intelligence Report (Company based and Sector based), notary and other professional services, business matchmaking, training and workshop capacity building, trade and investment as well as public policy consultation, permit and license facilitation, including government relations support. "IPSC is going to provide and facilitate exchange information for identifying business opportunities," she said.

Monday, 15 June 2015 |