Sparkling Of Indonesia’s Economic Must Be Defended
Investment Coordinating Board (BKPM) head Thomas Lembong has stressed that the result of Jakarta gubernatorial election, which saw Anies Baswedan emerge victorious over incumbent Jakarta Governor Basuki “Ahok” Tjahaja Purnama, will not negatively affect the investment climate in the country. What matters most to investors is how the government deals with its deregulation and infrastructure development programs.
He also strongly rejected the view of some international media outlets that interpreted the Jakarta election as a victory for hard-line Muslims. Indeed, some conservative groups played a role, but to say it was a victory for hard-line Muslims is too much.
The hope that the ongoing deregulation process and other economic reforms would not be distorted by political demonstrations held by hard-line Muslim groups such as the Islam Defenders Front (FPI).
Inconsistent derivative regulations issued at the ministerial level have hampered the government’s efforts to attract investors. Unstable and inconsistent regulations have prevented the entry of investment.
President Joko “Jokowi” Widodo had demanded that his ministers deregulate their respective institutions, but many new regulations issued by ministries and other government institutions had degraded the investment climate.
Meanwhile, interest in investing in Indonesia is still high, however. the country’s 2017 investment target could be achieved. Indonesia pocketed Rp 165.8 trillion (US$12.5 billion) in investment in the first quarter of the year, or 24.4 percent of the 2017 investment target of Rp 678.8 trillion, the Investment Coordinating Board (BKPM) announced.
This figure is a 13.2 percent increase from the Rp 146.5 trillion in investment recorded in the same quarter last year. Investment from local investors progressed significantly by 36.4 percent year-on-year (yoy) to Rp 68.8 trillion, while investment from foreign investors only grew by 0.94 percent to Rp 97 trillion.
In dollar value, foreign investment continued to show a stable increase of 5.7 percent to $7.3 billion. The pace was higher than the 4.5 percent recorded within with Q1 2015 to Q1 2016 period. A majority, or 80 percent of total local and foreign investment in the quarter, was fresh investment, while 20 percent was expansion. This is a sign that interest to do business here is still high.
The top investment sectors are mining, food, transportation, warehouses and telecommunications. The top three investment destinations are West Java, Jakarta and East Java. Singapore, Japan and China remain the top three investors – just like they were in the first quarter of 2016 – with $2.1 billion, $1.4 billion and $600 million in investment, respectively.
Must be Defended
Sparkling of Indonesia’s economic growth must be defended at least for some reasons as follows: firstly, amids the slump-in of economic world situation, Indonesia has succeeded to maintain their economic growth and those impacts for Indonesia’s security situation is a significantly.
Secondly, sparkling of Indonesia’s economic has been showing that Indonesia is one of a stable country in the world especially in Southeast Asia. Because of that, Indonesia has been targeted for an economic giant cooperation or several countries as an investment “heaven place”. With flow of an investment in Indonesia, its could be trigered municity and provinces including Indonesia’s economic situation will stable and conducive.
Thirdly, however sparkling of Indonesia’s economic growth as a outcome of a democratic atmosphere in Indonesia. The stable situation of Indonesia is a key actor to attrack an investor who comes from several countries have been sure that their money or their investment in Indonesia will be safe.
Fourth, with Indonesia’s economic growth is always stable, the government of Indonesia can use it to build and to boost an infrastructure development. If an infrastructure development in Indonesia will be acomplished done, its could be trigered regional development boosting and erasing criminal cases in Indonesia including creating more job vacant for Indonesia’s people.
Fifth, one of sources for the success of Indonesia to defend their economic growth is the government of Indonesia has been implementing a modern, transparent and accountable business and economic system in Indonesia so that it can close a manipulation or corruption practices.
Sixth, the Indonesia’s government has stressed that the result of Jakarta gubernatorial election, which saw Anies Baswedan emerge victorious over incumbent Jakarta Governor Basuki “Ahok” Tjahaja Purnama, will not negatively affect the investment climate in the country. Those stressed has been proven that Indonesia’s government will be strengthened and kept a conducive situation after the simultaneous regional elections in Indonesia.
*) Erlangga Pratama, an economic observer at Center of Risk Strategic Intelligence Assessment (Cersia) in Jakarta. He earned his master at the University of Indonesia (UI). Previously, he earned his bachelor degree at the University of Jember (Unej) in East Java, Indonesia. Now, he is attempting to reach his Phd tittle.