BKPM: Domestic Investment Remains Strong

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  • Franky Sibarani. TEMPO/Wisnu Agung Prasetyo

    Franky Sibarani. TEMPO/Wisnu Agung Prasetyo

    TEMPO.CO, JakartaIndonesia's Investment Coordinating Board (BKPM) claimed that domestic investment remains strong, despite the current economic slowdown.

    BKPM chief Franky Sibarani said in a statement received here on Friday that in-principle permits for domestic investment rose 17.2 percent in the first half of the year, compared to the same period last year.

    The value of the in-principle permits for domestic investment reached Rp189.2 trillion, which is higher than Rp161.4 trillion recorded in the same period last year.

    "The hike in the number of in-principle permits shows that domesticinvestors still have strong hope in Indonesia's future economy," Sibarani said.

    He added that he hoped the in-principle permits would be granted within one to two years.

    Based on BKPM data, five sectors recording the largest value are housing, industrial zone and office complex zone, worth Rp52 trillion, followed by non-metal minerals industries at Rp18.1 trillion, basic chemical and pharmaceutical industries with Rp15.9 trillion, food industries at Rp13.2 trillion, and transportation, warehousing and telecommunications values at Rp13 trillion.

    With regard to investment locations, Bali draws the largest investment, reaching Rp30 trillion, followed by Banten Rp23 trillion, West Java Rp23 trillion, Central Sulawesi Rp21 trillion and East Java Rp19 trillion.

    Franky said Java remained the main magnet for investors, includingdomestic investors, as shown by the number of domestic investment projects to be carried out on the island, reaching 2,038, or 63.5 percent of the total planned domestic investment projects in the first semester of 2015, which has reached 3,205.

    Meanwhile, the value of domestic investment plans in Java is Rp87.8 trillion, or 46.4 percent of the total domestic investment plans in the first semester in 2015, which is recorded at Rp189.2 trillion.

    To increase interest to invest outside Java, the Indonesian government continued creating a good investment climate by, among others, issuing Government Regulation Number 18 of 2015 on income tax allowance for investment in certain fields and/or areas which are to be followed later by a tax holiday facility, he said.