GOVERNMENT STRIVING TO MEET RP519 TRILLION INVESTMENT TARGET

by Andi Abdussalam

Jakarta, May 22 (Antara) -- The Indonesian government, through the Capital Investment Coordinating Board (BKPM), is doing its utmost to achieve its investment target of Rp519 trillion for 2015.         Efforts the BKPM is making to achieve the target include organizing a roadshow in at least three cities and holding activities such as a regional investment potential show (GPID) and a regional investment forum as part of it. It is also introducing an Inland Free Trade Agreement (Inland FTA) scheme to boost investment.         With intensive promotional efforts, the BKPM hopes to attract investment of some Rp27.8 trillion in Sulawesi, Rp75.2 trillion in North Sumatra, Rp75 trillion in Kalimantan and Rp7.2 trillion in Maluku this year.         Organized from May 18 to May 22, the roadshow was held in the three cities of Medan (North Sumatra), Manado (North Sulawesi), and Mataram (West Nusa Tenggara).         "We are now organizing a roadshow in the three cities of Medan, Manado and Mataram," BKPM Chief Franky Sibarani said in a press release received by Antara in Jakarta on Sunday last week.          The roadshow includes seminars and exhibitions on investment opportunities. Foreign diplomats and potential investors are among the invitees to the event.          The BKPM also organized one-on-one meetings for investors during the roadshow. Business delegations from South Korea, Australia, Britain, Singapore, Japan, Taiwan, the United Arab Emirates, and the United States were expected to attend the meetings.         In Sulawesi, the BKPM set its target at Rp27.8 trillion. "The BKPM is optimistic that it will achieve the target because investment opportunities in Sulawesi are great," Deputy for Promotion Affairs of the BKPM Himawan Hariyoga affirmed in Manado on Thursday, May 21.          The BKPM has projected an investment realization of Rp519.5 trillion in 2015. Some Rp282.6 trillion of the investment target is set for Java, Rp19 trillion for Bali and Nusa Tenggara and Rp33.2 trillion for Papua.           It was reported earlier that some Rp27.8 trillion of the investment will be made in Sulawesi, Rp75.2 trillion in North Sumatra, Rp75 trillion in Kalimantan and 7.2 trillion in Maluku.          To attract investment, the government has begun to realize various supporting infrastructure projects. It will develop 15 airports to support the country's logistics development. Among these are Miangas, Pohuwanto, Tojo Una-Una, and Buntu Kunik in Sulawesi; Muara Teweh and Maratua in Kalimantan; and Namniwel in Maluku.          In addition, the government is also planning to develop or expand 24 seaports to support its sea toll development program to facilitate the movement of cargo, which is estimated to reach 30 million TEUs in 2020.          He revealed that it included the expansion of seaports of Bitung and Makassar in Sulawesi; Pontianak, Palangkaraya, Banjarmasin, and Maloy in Kalimantan; Ambon in Maluku; and Hamahera in North Maluku.          Moreover, to meet the energy needs and to accelerate investment, the government is planning to build hydropower plants with a combined capacity of 3,967 megawatts (MW) in North and Central Sulawesi and 6,340 MW in South and Southeast Sulawesi.         Similar power plants will also be built with a combined capacity of 16,844 MW in South, Central, and East Kalimantan; 4,737 MW in West Kalimantan; and 430 MW in Maluku.          The infrastructure projects are expected to facilitate investors' needs with regard to logistics, information connectivity, and energy.          While in North Sumatra, the BKPM sought to achieve Rp75.2 trillion. "Of the targeted value, the realization of investment in Sumatra in the first quarter of the year has reached Rp21.1 trillion, which includes domestic investment worth Rp8.8 trillion and foreign investment worth US$1 billion," Sibarani stated on Monday, May 18.          The BKPM chief, who was in Medan for the board's roadshow, added that the events were organized to ensure high economic growth and to achieve the investment target. To carry out the program, the BKPM is cooperating with various provincial governments.          Ten foreign investors have expressed interest in the energy sector, he remarked.          "North Sumatra is an attractive place to invest as it is one of the top ten investment destinations," he noted at a regional investment forum organized by the BKPM in cooperation with the North Sumatra provincial government.          North Sumatra is ranked eighth in terms of foreign investment destinations in the country and tenth in terms of domestic investment destinations, he pointed out, adding that the regional government has played a greater role than the central government in luring investors.          The province's improving infrastructure has been one of the key factors in attracting investment, he emphasized. One of the infrastructure projects being developed in North Sumatra is a 2x200 MW-capacity power plant in Pangkalan Susu.          Another power plant with a capacity of 600 MW will also be built in the province, he affirmed. "All these will help to improve North Sumatra's image as an attractive investment destination," he added.          In its efforts to lure investors, the BKPM will also introduce an Inland Free Trade Agreement (Inland FTA) scheme.          Sibarani noted in a written statement made available to Antara recently that the Inland FTA is a unilateral trade liberalization policy aimed at increasing investment in the manufacturing industry and in industrial development in Indonesia.         "The scheme is a strategy to attract investment, strengthen the domestic industry, and boost economic growth," he remarked.          It will provide customs and trade facilities to the domestic industry by implementing the FTA preference in the production process across all regions in Indonesia.          Sibarani stated that by implementing the policy, the government will abolish import duties on raw materials and semi-finished goods imported from countries that have not signed an FTA with Indonesia.          "So far, finished and semi-finished goods or components produced at bonded or free trade zones (in Batam, Bintan, Karimun, and Sabang) are required to pay import duties when they enter the customs and excise areas in Indonesia. They are treated like imported goods, while at the same time, the same goods produced in Singapore or Malaysia, for example, (with 40 percent ASEAN local components) are not imposed import duties when they enter Indonesia because they use the FTA ASEAN scheme," he explained.          In a coordination meeting at the office of the Coordinating Minister for Economic Affairs on Tuesday, May 12, the government agreed to an FTA import preference for products produced at home.          The policy regulates that specific goods produced in certain places at home and used as raw materials, auxiliary materials, and import components are goods made in Indonesia and will not be liable to any import duties if they are sold and used at home or when they are moved to Indonesian customs and excise areas.          Acting deputy for Capital Investment Cooperation of the BKPM Azhar Lubis stated that his office will soon draft a BKPM chief's regulation on investment facilities in the framework of the implementation of the Inland FTA scheme. It is expected to be issued by next August.     ***3*** (T.A014/INE) EDITED BY INE (T.A014/A/BESSR/A. Abdussalam) 22-05-2015 20:08: