BATAM GEARING UP FOR INVESTMENT IN FACE OF AEC

By Andi Abdussalam

Jakarta, Aug 13 (Antara) - Adjacent to Singapore, the tiny Batam island, which is a free trade zone (FTZ) and an industrial hub in Indonesia's Sumatran Province of Riau Islands, is preparing for investment growth.          In the face of the ASEAN Economic Community (AEC), which will begin in late 2015, Batam has to boost the growth of its industry, trade, and investment. In view of that, the quality of its human resources will play an important role.          Chairman of the Economic and Polytechnics Research Center of Batam, Bambang Hendrawan, said the government should pay attention to the quality of its human resources in the face of steady investment growth of Batam's FTZ.          "The quality of human resources should be improved, so that Batam will no longer rely on standard quality that so far has laid emphasis on labor-intensive industries. This also should serve as an effort to face the flow of expatriates after the implementation of the AEC in 2015," Bambang noted.            However, according to economic and FTZ observer Suyono Saputra, the investment made in Batam so far had tended to be labor intensive. If this condition continues, growing investment in Batam will absorb more job seekers.          "Investment usually is able to offer jobs for a significant number of workers. Shipyards and electronic manufacturing industries usually need additional workers," Suyono pointed out.          He said that the absorption of a large number of workers was one of the goals that will be achieved in the implementation of a FTZ.          "Apart from workers, FTZ should also be able to earn foreign exchange currencies, increase exports, and attract foreign investments," asserted Suyono.          After all, Batam is now witnessing robust investment growth. On Tuesday, BP Batam had released an encouraging foreign investment data, revealing that in the first half of this year investments had reached US$641.04 million.          A total of 72 foreign investors had made a foreign direct investment (FDI) of US$270.53 million in Batam's Free Trade and Port Zone in the January-June 2014 period, which was able to absorb 3,253 additional workers.          "The number of companies and investment values are higher than that of the same period last year when a total of 51 companies made an investment of US$77.28 million," Director of Integrated Service Affairs and Public Relations of the Batam Management Board (BP Batam), Dwi Djoko Wiwoho, said on Wednesday.          The Batam Management Board reported that FDI in the island had reached US$641 million in the first half of 2014.          The FDI included US$270.53 million by 72 new investors and the rest were investments for expansion by old investors in the island, Dwi Djoko Wiwoho pointed out.          In the January-March 2014 period, a total of 35 additional foreign investors had invested US$155.53 million. Most of these investments had been made in shipping businesses and other industrial sectors.          In April this year, 15 foreign investors showed interest in investing US$88.5 million in the Batam FTZ and another investment expansion of US$49.5 million by old companies, while in May 11 foreign investment schemes worth US$11.85 million plus US$14.65 million in investment expansion by old firms were made.          Djoko said in the following month in June, BP Batam had registered another 11 foreign companies, with an investment worth US$14.65 million and an investment expansion totaling US$122.75 million.          He noted that countries interested in making their investment in the first semester of this year in Batam's free trade zone were Singapore, Malaysia, Italy, Britain, Australia, Hong Kong, China, India, New Zealand, Japan, South Korea, the United States, and Canada.          "This year we have been focusing our promotional activities in Asia, which in terms of economic aspect has better growth than those of the United States and European countries. However, many other countries outside Asia had expressed interest in investing in Batam," Djoko added.          Djoko said, in 2014, Batam authorities had conducted various investment promotional activities in both Batam and Jakarta, as well as in Singapore in an effort to attract more investors.          "We hope that in 2014 seven business meetings will be held with foreign investors in Indonesia and abroad. In Japan, we could hold one or two business meetings," BP Batam Spokesman said.          By conducting various promotional activities with foreign investors, BP Batam expects to receive a total investment commitment of US$500 million this year.          BP Batam has set a target of US$350 million for new FDI and US$500 million for new investment commitment in 2014.      "We are confident the targets could be achieved as in the first half of this year. New FDI has already reached US$270 million," Djoko said.          "This year we have set a target of foreign investment worth US$500 million. We hope the investors will realize their investment commitment as soon as their applications are approved," Djoko remarked.          In the meantime, officials from the Clinton Foundation, a non-profit agency that deals with social and business affairs of the United States, had been scheduled to visit Batam to conduct a study on the city's FTZ.          "They have planned to come along with US entrepreneurs in October," Dwi Djoko Wiwoho said on Tuesday.          The Clinton Foundation, an agency established by former US President Bill Clinton, intends to study the Batam FTZ as a possible investment destination in the Asia-Pacific region.          "Clinton Foundation representatives Terry Krinvic (Director of Scheduling), Tim Biba (Associate Director of Advance), and Julie Becker (Intern Program Director) had earlier visited Batam in May 7 to ensure a visit occurs in October," he added.***2*** (T.A014/INE) EDITED BY INE (H-YH) (T.A014/A/BESSR/A/Yosep) 13-08-2014 22:56:4