JAKARTA (TheInsiderStories)—Indonesia recorded weak investment realization of Rp176.3 trillion (US$12.055 billion) in the second quarter of this year, Investment Coordinating Board reported on Tuesday (14/08).
It decelerated 4.9 percent from Rp185.3 trillion (US$12.67 billion) in the first quarter of this year but increased 3.1 percent from Rp170.9 trillion (US$11.68 billion) compared to the second quarter of last year.
The realization of foreign direct investment (FDI) in Indonesia reached Rp95.7 trillion, significantly down 12.9 percent (YoY) from Rp109.9 trillion in the same period of 2017. The Government expects FDI to realize Rp799 trillion in this year.
Meanwhile, Domestic Direct Investment (DDI) increased by 32.1 percent to Rp80.6 trillion in the second quarter of this year from Rp61 trillion in the same period last year.
Head of Investment Coordinating Board Thomas Trikasih Lembong said the weak investment in the second quarter of this year in line with the Central Statistics Agency data that announced a lower investment growth of 5.58 percent. He added that rupiah depreciation against US dollar and US-China trade war became the main factors that bring investment lower in the second quarter of this year.
In addition, the political cycle toward election also put more pressure on the investment realization in the second quarter of this year. “Investment seems to slow down and investors tend to wait and see amid uncertainty condition,” he added.
Singapore still the biggest investor in Indonesia with an investment of US$2.4 billion and contributed to 33.5 percent of total investment realization. It followed by the countries in Asia namely Japan (US$1 billion or 14.4 percent), China (US$0.7 billion or 9.4 percent), Hong Kong (US$0.6 billion or 8.2 percent), and Malaysia (US$0.4 billion or 5.3 percent).
The board recorded the top five locations of investment realization namely DKI Jakarta (Rp29.9 trillion or 16.9 percent), West Java (Rp22.2 trillion or 12.6 percent), East Java (Rp16 trillion or 9.1 percent), Banten (Rp14.4 trillion or 8.2 percent), and East Kalimantan (Rp13.8 trillion or 7.8 percent).
Furthermore, the top five sectors in which investors invested were mining (Rp28.2 trillion or 16 percent); transportation, warehouses, and telecommunication (Rp25.6 trillion or 14.6 percent); electricity, gas, and water (Rp20.8 trillion or 11.8 percent); food and beverages industry (Rp17.7 trillion or 9.8 percent); and housing, industrial estates, and offices (Rp15.8 trillion or 8.9 percent).