JAKARTA (TheInsiderStories) - Seven foreign firms from the United States (US), Japan, Taiwan and South Korea ready to relocates their factories to Indonesia, said head of state during his visit to Batang industrial zones in Central Java. Total investment from the companies reaches US$850 million with a potential employment of up to 30,000 people.
“I am glad that seven companies have entered, then 17 investment potentials of $37 billion must be guarded, pursued and served. Increase the competitiveness, don’t let the 2019 incident occurs again (no companies will relocate to Indonesia),” said President Joko Widodo in his opening speech on Tuesday (06/30).
He said, the reasoned open an industrial area in Batang to open as many jobs as possible. While, head of Investment Coordinating Board, Bahlil Lahadalia stated, that the process to attracted investment from the companies was carried out intensively by a special task force.
“The process is very intensive. We ‘knocked’ on the company one by one, to ensure that Indonesia was the right location for the factory. Extraordinary challenge. But that’s we do to work creatively and responsively,” he said in an official statement this afternoon.
He elaborated, the seven companies are Alpan Lighting (PT CDS Asia) from the United States, Sagami Electric (PT Sagami Indonesia), Denso (PT Denso Indonesia), Panasonic (PT Panasonic Manufacturing Indonesia) from Japan, Meiloon (PT Meiloon Technology Indonesia) and Kenda Tire (PT Kenda Rubber Indonesia) from Taiwan, also LG Electronics (PT LG Electronics Indonesia) from South Korea.
In addition to them, there are 17 other investors who have expressed their interest in relocating or diversifying their industries to Indonesia. One of them is an investor from South Korea, LG Chemicals, who expressed its commitment to build an integrated vehicle battery industry with a smelter in the country. The investment planned is estimated worth of $9.8 billion and to absorbs around 14,000 workers.
Beside Batang, Indonesian government also prepares Brebes Industrial Park to relocates Japan and US plant from China as an effort to boost the development of Central Java and spur national economic growth. The trade tension between the two largest economy, he acknowledge become an opportunity for the country.
“The plan is for the relocation of industrial companies from Japan and the US that will leave China,” said industry minister, Agus Gumiwang Kartasasmita on May 29.
The industrial zones is targeted to be a core industry for the textile products, the leather and footwear industry, the food and beverage industry, the furniture industry, also the pharmaceutical and medical device industry. He explained, the acceleration of the development of the industrial zones based Presidential Regulation Number 79 of 2019 concerning the Acceleration of Development in Central Java, which targets economic growth of 7 percent.
State-owned enterprises, PT Wijayakusuma Industrial Estate has assigned as the developer and manager of Brebes industrial zones. No further details how much investment the company prepares for the projects.
“Currently, the master plan and feasibility study is being prepared. Hopefully this stage can be completed in July 2020, even in the current pandemic conditions,” Kartasasmita stated.
He hopes that the land acquisition for the development of the Brebes with a total land area of 3,976 hectares can be realized soon. This area covers three sub-districts, namely Bulakamba, Tanjung, and Losari.
The industrial zones part of National Priority Projects in 2020. As known, President Joko Widodo has approved 89 infrastructure projects to build in this year. Beside build in Java Island, the government plans to build 19 priority industry areas outside Java from 2020 until 2024.
Kartasasmita said the government intends to grow industry outside Java since 2015 by developed 14 priority industry areas. Until 2019, the government has built 24 industry areas in the Sumatra, Kalimantan and other islands excluded Java.
With this success, the government will add 19 industrial zones in nine areas. In Sumatra are Sei Mangkei and Kuala Tanjung in North Sumatra, Galang Batang and Bintan Aerospace Industry in Riau, Kemingking in Jambi, Tanjung Enim South Sumatra, Pesawaran and Way Pisang in Lampung, also Sadai in Bangka Belitung.
Then, the ruler will establish six areas in Kalimantan, which are Ketapang in West Kalimantan, Surya Borneo in Central Kalimantan, Buluminung in East Kalimantan, Tanah Kuning in North Kalimantan, also Batulicin and Jorong in South Kalimantan. The rest are Bangkalan in Madura, Weda Bay in North Maluku, Palu in Central Sulawesi, and Teluk Bintuni in West Papua Barat.
The minister said the industry areas development is focused on agro industry, oil and gas, metal and coal, also high technology industry and aerospace. The industry area planning has been through examination from various aspects.
While, areas in Java will be focused on high technology, labor-intensive and industry with water low consumption and outside Java tend to be natural resources industry, logistic efficiency system industry, and center of new economic development. To date, there are 103 areas that have operated with 55,000 ha total areas. The areas are located in Java of 58 areas, Sumatra of 33 areas and other areas.
Besides, there are 15 industry areas under construction and 10 areas in the planning stage. The activity in industrial areas has generated a multiplier effect on the national economy, ranging from the added value increasing, local human resources absorbing, and foreign exchange earnings.
Written by Staff Editor, Email: theinsiderstories@gmail.com
