Indonesian government has added Likupang in North Sulawesi Province into lists of its special economic zones - Photo: Special.

JAKARTA (TheInsiderStories) – Indonesian government has added Likupang in North Sulawesi Province into lists of its special economic zones (SEZ) through government regulation number 84 of 2019, State Secretary announced on Monday (12/16). The rules were officially promulgated on December 10, 2019.

“Aims to develop economic activities in the area of ​​North Sulawesi Province which is strategic for the development of the country’s economy, it is necessary to develop a special economic zone,” the regulation consideration said.

With the new regulation, the ​​197.4 hectares zones have fulfilled the criteria and requirements as SEZ.

The government set Likupang as one of the country’s tourism zone. The North Minahasa Regent is mandated to establish a business entity developing and managing the zones within 90 days and must be ready to operate within a maximum of three years from the enactment of the regulation.

There are still three other SEZs awaiting approval by President Joko Widodo this year. It includes the 166.45 ha of Nongsa Digital Park and Maintenance, Repair, and Overhaul (MRO) zones, both located in Batam. Also Kendal Economic Zone in Central Java with an area of ​​1,000 ha.

Besides four SEZs, coordinating minister for economic affairs (CMEA) previously reported Indonesia has developed 13 SEZs spread across the country, with total investments Rp85.3 trillion (US$6.05 billion) and have absorbed a workforce of 8,686 peoples. The nation aimed to build 17 SEZs in this year.

Based on the ministry data, number of SEZs have been operated such as in 2012 has build SEI Mangkei SEZ in North Sumatra, Tanjung Lesung SEZ in Pandeglang Regency (Banten), Palu SEZ (Central Sulawesi), Bitung SEZ (North Sulawesi), and Morotai SEZ (North Maluku).

In addition, the Maloy Batuta Trans Kalimantan SEZ (East Kalimantan), Mandalika SEZ (West Nusa Tenggara), Tanjung Kelayang SEZ (Bangka Belitung Islands), Arun Lhokseumawe SEZ (Aceh), and Galang Batang SEZ (Riau Islands).

Furthermore, the Sorong SEZ (West Papua) will become the eleventh SEZ, whose operations will be officially opened on Oct. 11. The other SEZs, namely the Singhasari SEZ have just been designated as SEZs through Government Regulation Number 68 of 2019, and the Tanjung Api-api SEZ in South Sumatra whose status has been previously established, are now preparing to enter the operational stage.

He explained, SEZs became a regional economic driver. He gave an example, Galang Batang SEZ in the Riau Islands will become an integrated bauxite downstream center with an investment commitment of Rp36.25 trillion until 2023.

With the presence of Galang Batang SEZ, the regional income of the Riau Islands Province increased by 25.80 percent in the period 2015 to 2017. Gross Regional Domestic Product increased by 15.58 percent in the period 2015 to 2018 and will continue to increase along with investment developments coming into Galang Batang SEZ.

In the Mandalika SEZ (Lombok), world-class hotels are being built such as Pullman, Royal Tulipe, and Paramount, and are preparing to host a MotoGP performance in 2021.

The investment commitment in this tourist area reaches Rp17.5 trillion. Data on the development of tourist visits in Central Lombok Regency 2015-2018 shows foreign tourist arrivals increased 361 percent and domestic tourists increased 170 percent.

US$1: Rp14,100

Written by Lexy Nantu, Email: lexy@theinsiderstories.com