BKPM to Provide Incentives for Green Industries
28 April 2015 09:10 WIB
TEMPO.CO, Jakarta - The government plans to jack up its investment in the sustainable industries sector. "We are ready to provide financial incentives as well as easier licensing procedures in order to achieve the goal," said the Head of the National Investment Coordinating Board (BKPM), Franky Sibarani, on Monday.
Franky said that government aims to increase its' investment in green industries to around US$100 billion by 2019, up from US$40 billion that the government has invested in the sector between 2009-2014 - equivalent to Rp520 trillion with an annual increase of around 20 percent.
According to Franky, BKPM wants to jump start a transitional phase, wherein conventional industries would begin to transform themselves into a greener, more sustainable form of industries.
The government could provide incentives for sustainable industries as outlined by Decree No. 18 of 2015 - which outlines the set of parameters wherein an institution could qualify for such incentives, including a high capitalisation, degree of export orientation, high labour-intensiveness, as well as high local content in its final product.
To support the government's targets, the Decree, according to Franky, has also been expanded to include 143 industries - up from its previous 129 - and has removed a minimum investment threshold as a prerequisite to qualify for such incentives.
By 2020, BKPM wants all existing and new industries to prioritise the development of green and sustainable concepts of production, wherein all industries will be obligated to use recyclable and/or sustainable material and renewable energies. According to BKPM, industries that have begun transitioning towards more sustainable practices include agriculture, forestry, fisheries, geothermal energy, homeware industries, as well as waste management and reprocessing. "Two other sectors have shown promising progress - transportation, and infrastructure development," said Franky.
The Minister for the Environment and Forestry, Siti Nurbaya, said that the government will be providing even more incentives to drive the development of Indonesia's green industries - especially in the field of ecotourism, renewable industries, waste management, bio-thermal energy, animal conservation, import substitution, as well as ecosystem restoration, wherein licensing procedures will be simplified, as well as the exemption of import fees for equipments relating to the businesses, as well as for components that are being used to treat and/or minimise their environmental impact.
An expert staff for the Ministry for Energy and Mineral Resources, Widyawan Prawira Atmaja, said that the government is targeting a significant increase of investments in the renewable energies sector - from Rp1.3 trillion this year to Rp10.3 trillion by 2016. "These will be used to develop Indonesia's renewable energy potential - may it be geothermal, wind, hydroelectric, or even solar power," he said.
ANDI RUSLI | URSULA FLORENE | AMIRULLAH
