3 Facts That Shows Indonesia Is Attracting Foreign Investment

3 Facts That Shows Indonesia Is Attracting Foreign Investment

As a country that has great potentials, the Indonesia government performs various efforts to develop the country, and one of those moves is by inviting foreign investors to invest in Indonesia. Below are the summaries of 3 major ways performed by Indonesia government (Indonesia does more than this).

 

  1. Promotion

On certain press conference, the President of Indonesia, Joko ‘Jokowi’ Widodo, stated that the first thing he would do to invite investors is by introducing the potentials of Indonesia. Indonesia has some international events, and one of them is the Regional Investment Forum. This event is held annually which will be the moment for promoting to invest in Indonesia and business and investors meeting.    

  1. Improving the Service and Infrastructure

Besides promoting, Indonesia government also fixes other aspects, like the service and infrastructure. For business licensing service, in July of 2018, Indonesia Investment Coordinating Board (BKPM) launched an integrated digital system called Online Single Submission (OSS).

The new system is intended to handle as many investors as possible and also to minimize the space for the acts of corruption. The procedure may be unfamiliar even for the existing investors, but, BKPM always prepares their ‘help desk’.

  1. Negative Investment List (NIL) Amendment: Perpres Number 44 the Year 2016

In the year of 2016, Presidential Decree (Perpres) for investment was released. The amendment includes the renewal of NIL Perpres Number 39 the Year 2014. To attract a greater number of investors, some business fields are 100% permitted and increased for foreign investors.

  1. The 100% Permitted

Trade

  • Cold storage
  • Distribution affiliated with the production
  • Direct selling through marketing networks
  • Brokers

Tourism and Creative Economy

  • Bars, cafes, and operation of sport facilities
  • Restaurants
  • Film: studios, processing, dubbing, printing, and/or duplication facilities
  • Film: shooting, editing, subtitling facilities, production, cinema, distribution, and recording studios

Public Works

  • Toll Road Management
  • Non-hazardous waste management
  • Industrial sector
  • Crumb rubber

Communication and Informatics Sector

  • E-commerce in the form of a marketplace, daily deal, product and price aggregator, and/or online classified ads model which involve more than IDR 100 billion investment
  • Telecommunication equipment certification

Healthcare

  • Business and Management Consultancy
  • Hospital Consultancy Service
  • Healthcare support service
  • Medical Equipment Rental
  • Laboratory, medical check-up clinic

Energy and Mineral Resource

  • Biomass pellet industry for renewable energy

 

  1. The Enhanced Permit Percentage

Communication and Informatics

  • E-commerce in the form of a marketplace, daily deal, product and price aggregator, and/or online classified ads model which involve less than IDR 100 billion investment (49%)
  • Fixed and mobile telecommunication networks (67%)
  • Telecommunication networks integrated with telecommunication service (67%)
  • Telecommunication service (e.g. internet service provider) (67%)

Energy and Mineral Resource

  • Examination and testing of high voltage electrical installation (49%)

Manpower

  • Professional training, such as computer courses and TOEFL/IELTS courses (67%)

Public Work

  • Construction consultancy service involving advanced technology, high risk, and/or a value more than IDR 10 billion (67%, or up to 70% for ASEAN investor)

Tourism and Creative Economy

(67%, or up to 70% for ASEAN investors)

  • Golf courses
  • Travel Bureaus
  • Motels
  • Meeting, Incentives, Conference, and Exhibitions (MICE) operation
  • Private museums (67%

Trade

  • Department stores with retail space of 400-2,000 m2 (67%)
  • Distribution non-affiliated with production (67%)
  • Warehouse (67%)

Transportation

  • Passenger land transportation (49%)
  • Non-scheduled land transportation (49%)
  • Supporting service for transport terminals (67%)
  • Freight forwarding service ((67%)
  • Air Cargo Expedition service (67%)
  • General sales agencies for foreign airlines (67%)
  • Maritime cargo handling service (67%, or up to 70% for ASEAN investors)

 

In the future, Indonesia Government may make more effort to invite foreign investors to invest in Indonesia. At last, the information above is expected to help you. However, if you still find it difficult, hiring local service would be a great option.

If you have any questions about the establishment of a PT PMA, you can contact Smart Legal slc@smartlegal.idor +6221–8067 4920

 

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