BKPM: Political Turmoil Has No Effect on Investment

TEMPO.CO, Jakarta - Azhar Lubis, Deputy for Investment Control at the Investment Coordinating Board (BKPM), said that political turmoil will not affect long-term investment. "When conducting long-term investment, investors are already prepared for this kind of condition," said Azhar.

According to Azhar, long-term investment will not immediately stop capital investment. When Soeharto stepped down from presidency in 1998, the event had been anticipated by investors. "Back then, investors were still willing to invest," he said.

However, Azhar acknowledged that there were concerns about the political situation in Indonesia regarding government transition. The same thing also occurred in Japan, France and Thailand, who had a change of regime. "We're still hoping that there will be reconciliation. If political situation is stable, economic improvement will follow immediately," said Azhar.

Based on BKPM data, in the first semester of 2014, investment realization have increased by 16.4 percent, Contribution of foreign investment reached 67.3 percent, while 32.7 percent came from domestic investors.

Foreign investment reached Rp150 trillion or 20.2 percent higher compared to the same period last year, while domestic investment was Rp72.8 trillion or 13.5 percent higher. In overall, BKPM targets investment to reach Rp456.6 trillion in 2014.

AISHA SHAIDRA