JAKARTA (TheInsiderStories) – The Investment Coordinating Board of Indonesia (BKPM) reported that total realized direct investment in Indonesia in 2017 reached Rp692 trillion, representing an increase of 13.1 percent from Rp612 trillion worth of total direct investment in previous year.
Thomas Lembong, the Head of BKPM, said investment realization managed to absorb 350,399 Indonesian workers.
Domestic Direct Investment (DDI) increased by 21.3 per cent year-on-year (y/y) last year to Rp262.3 trillion from Rp216.2 trillion in 2016. Meanwhile, the realization of foreign direct investment (FDI) in Indonesia reached Rp430.5 trillion, up 8.5 per cent (y/y) from Rp396 trillion in 2016.
The biggest foreign investor in Indonesia in 2017 was Singapore (US$8.4 billion), followed by Japan (US$5 billion) and China (US$3.4 billion).
The top three sectors in which foreigners invested were (1) mining (US$4.4 billion), (2) electricity, gas, and water supply (US$4.2 billion), and metal, machinery, and electronic industry (US$3.8 billion).
While there was improvement in 2017, said the country need to put effort to attract FDI.
“We are still losing to the neighboring countries such as the Philippines, Vietnam and Thailand,” Lembong said. “We have to continue improving the investment climate.”
The government is aiming to further reduce Indonesia’s notorious red-tape to meet President Joko Widodo’s target for investment to account for a bigger share of gross domestic product. Earlier this month, Lembong said the board is targeting an increase of 10-14 percent in total direct investment this year, which would be supported by activity in the service sector and e-commerce.