Indonesia is open for any foreigner who interest to make investment in Indonesia, Indonesia divided investment become three categories which are: new investment, expansions and changes investment. Changes investment means "foreign investor buys domestic company partly or wholly in which case the entire equity of the Indonesian firm is added to the investment approval totals".
The major investor in Indonesia is United States, Japan, China, Hong Kong, Singapore, Taiwan, United Kingdom, South Korea, Germany and Australia. Most of that country invested in Trade, Industry, Property, Plantation, Services, Infrastructure, Construction, Fishery, and Franchises.
Indonesia government practices law no 1 year 1967 its amendment about the Foreign Investment and Law no 1 year 1995 about limited Liability Company. All foreign investor only have right to land holdings for usually obtained through long-term lease agreements (normally for 30 years) with the government or private parties.
Certain sector is close for all investor which is: marijuana, sponges, harmful chemical products, weapons, alcoholic drinks, casinos, air traffic systems. Sector that only closed for foreign investor which is "germ palms cultivation, forest concessions, lumbering contractors, taxi/bus transport and small-scale water transport services, print media, TV, radio, film and cinema, including distribution and exhibition, small-scale retail trade".
References:
http://www.bkpm.go.id/id/downloads/31
http://www.fnpfirm.com/lib/Foreign_Investment_in_Indonesia__writeup_.pdf
http://www.idrc.ca/en/ev-68161-201-1-DO_TOPIC.html#
http://www.smh.com.au/news/Business/Indonesia-battles-to-attract-foreign-investors/2005/01/14/1105582715689.html
Friday = Time to wash toilet
13 years ago
13 comments:
Ok, there are foreign investment in indonesia, like in any other country in the world.......... so, what's the expectation of this post? humm, let me see, i'd invest in indonesia. Very soon, you'd see some eric burgers around the corner!!
Hi, in my opinion as long as growth in economy is concerned, offering the incentives to the enriched countries in the financial and scientific aspect must be prioritized. Although there is the risk out of this strategy which must be considered “colonial authority of investors on the country” but as Malaysia has imposed the so called “local share holding” law on the foreign investors, Indonesia must follow the same strategy to overcome the mentioned risk.
Despite the large inflows of FDI into Indonesia's manufacturing sector during the past three decades, Indonesia has in general not been very successful in taking full advantage of the presence of FDI projects to promote the development of its indigenous industrial technological capabilities, at least compared to its East Asian neighbours. This lack of success has been attributed to the high facilitation payments required to realise an FDI project and the relatively high costs of infrastructure services and leasing land, the lack of transparency and cumbersome licensing procedures and, at least until the important foreign investment deregulation package of June 1994, the requirement for foreign investors to divest their equity ownership to a minority position of maximum 49% within a specified period of time. In order to obtain greater technological benefits from FDI in the near future, the new Indonesian government will henceforth, aside from pursuing sound macroeconomic policies and pro-competition policies to ensure a competitive business environment, have to pursue a consistent and transparent foreign investment policy to attract the FDI it needs for Indonesia's economic recovery and for sustaining its economic growth and export-oriented industrialisation. To achieve this, the Indonesian government needs to continue dismantling its still cumbersome regulatory framework in order to reduce the still high facilitation costs associated with setting up a new FDI project. In addition, the Indonesian government will have to put a high priority on developing and upgrading the country's human resources in order to raise their capacity to absorb, assimilate, modify, and improve the imported technologies, whether transferred through FDI or purchased through technical licensing agreements with transnational corporations (TNCs).
Source from:(http://www.inderscience.com/search/index.php?action=record&rec_id=2979&prevQuery=&ps=10&m=or)
Indonesia has been a very attractive market for the foreign investors since its time of independence. A number of foreign companies, most of them large multinationals, have invested in the Indonesian market in certain areas. These companies have contributed a lot in the development of the country's resources, building infrastructure, establishing manufacturing facilities for export and/or provide products and services for the domestic market. The Indonesian market is a very hot perspective for investment and there are numerous opportunities available for setting up a company.
Yes, foreign direct investment is playing a very important role in building up a country's economic. Yes, as what Eric been mentioned, there are foreign investment in any other country also. A country could not survive or maybe building up a good economic without trading with other countries.
“Headline: Indonesia Jan-May foreign direct investment rises
Mon Jun 16, 2008 3:41pm IST
JAKARTA, June 16 (Reuters) - Foreign direct investment (FDI) in Indonesia rose 164 percent in the January-May period from a year ago, helped by strong investment in telecoms and transport, the state investment agency said on Monday.
The agency, also known as BKPM, said FDI rose to $9.78 billion in the first five months from $3.70 billion in the same period a year ago” (http://in.reuters.com/article/asiaCompanyAndMarkets/idINJAK20004020080616)
Well, it is all well in Indonesia for the year 2008 in the telecoms and transport industry. However, as I have heard that there is a policy in Indonesia that states that investments and profits are unable to be redrawn from the country. How true is this?
Foreign Direct Investment (FDI) in Indonesia leaps 123% in Jan to August 2007.The value of Foreign Direct Investment in the country skyrocketed 123.16 per cent year-on-year to reach US$11.7 billion in the first eight months of this year.
However,the realization of investment was mainly in the transport, warehousing and telecommunications sectors, together representing 30 projects accounting for US$3.28
billion of the value.
http://www.antara.co.id/en/arc/2007/9/7/foreign-direct-investment-in-indonesia-leaps-123-jan-aug/
Therefore,I hope the realization will bring up the country's economy and motivate more Foreign Investor into the country.Nevertheless,the government of Indonesia should be more alert and control with the certain sector that you mentioned closed for all investor.For example marijuana,sponges,weapons and casinos. However,if alcohol drinks are a closed sector,why there are still people sell alcohol drinks in public and widely?
HI,nice topic as we know foreign ivestment can help the host country economic growth up and also there are some requirement for the foreign investors.Indonesia is a good country to investment the reason are Indonesia is a developing country and the raw material and labour should be cheaper than the developed country.but here some rason to consider about investment to Indonesia the first is the earthquake and the government requirement.
Indonesia encourages private sector-led growth and foreign investment. It maintained a relatively open foreign investment regime and President Megawati declared 2003 as the "Year of Investment." Official appeals for investment have not been matched by action on serious issues facing investors such as judicial reform and rampant corruption.
Investors reduced investment in the last few years; balance of payment statistics continue to reveal net negative investment flows. Foreign investment approvals in 2002 declined to USD 9.8 billion, from USD 15 billion and USD 16 billion for 2001 and 2000, respectively. Indonesia tracks only investment approvals, which, if they happen at all, may require years to realize. Investment approvals for Indonesian firms trended even more steeply downward amounting in 2002 to only USD 2.8 billion, from USD 5.8 billion and USD 11 billion in 2001 and 2000, respectively. Indonesia counts three categories for investment-new investment, expansions, and changes in status which inflates investment approval figures. Changes in status occur when a foreign investor purchases a domestic company--partially or wholly--in which case the entire equity of the Indonesian firm is added to the investment approval totals. Recent privatization sales greatly increased the amounts in the change in status category and resulted in inflated investment figures for 2002.
Article source:-http://www.kanwilpajakkhusus.depkeu.go.id/infoInvestment.asp
If i ever visit Indonesia and find eric burgers there then......,,,!!!
Jakarta (ANTARA News/Asia Pulse) - The value of foreign direct investment in the country skyrocketed 123.16 per cent year-on-year to reach US$11.7 billion in the first eight months of this year.
Implementation of foreign investment projects surged 106.8 per cent to US$8.13 billion and domestic investment jumped 171.91 per cent to US$3.57 billion, said chief of the investment board, Muhammad Lutfi.
Realization of investment was mainly in the transport, warehousing and telecommunications sectors, together representing 30 projects accounting for US$3.28
billion of the value.
Source:
Business in Asia Today - Sept 7, 2007
Indonesia maintains a relatively open foreign investment regime, overall investment remains around 24 percent of GDP, far less than consistent pre-Asian financial crisis levels of 30 percent. Regional competition, delayed reform, and several high profile investment disputes continue to inhibit investor confidence.
Indonesia continues to prohibit foreign investment in the following areas: germ plasm cultivation; purchase of or investment in natural forests; logging; taxi/bus services; small-scale sailing; film production; and trading and trade- support services, except large-scale retailers, wholesale trading and exhibition/convention service providers.
http://www.state.gov/e/eeb/ifd/2006/62358.htm
Nella, no disrespect but let me ask you something...
What is the main purpose of you posting this article? I am not quite getting it...I think we all aware that almost all the countries have FDIs similarly to your country...
Very Descriptive....
ndonesia has been a very attractive market for the foreign investors since its time of independence. A number of foreign companies, most of them large multinationals, have invested in the Indonesian market in certain areas. These companies have contributed a lot in the development of the country's resources, building infrastructure, establishing manufacturing facilities for export and/or provide products and services for the domestic market. The Indonesian market is a very hot perspective for investment and there are numerous opportunities available for setting up a company.
The government of Indonesia itself is quiet interested in inviting new foreign companies and attracting more and more investments in the country. This policy had been adopted by the Indonesian government from the very beginning and therefore it has taken several measures in this regard. To encourage the foreign direct investment in the country, the Indonesian government introduced the Foreign Investment Law No. 1/1967 in the year 1967. However, this legislation excluded oil and gas, banking, insurance and leasing sectors. This law provided a number of incentives to the investors such as tax exemptions and some guarantees. Though in the beginning, the Indonesian government adopted an open door policy but in later years they changed their strategy. In the year 1970, some of the sectors were closed for foreign direct investments. In the coming years these policies were made further strict because of the protest from the public on the over presence of Japanese investors. After these restrictions the foreign investors were required by law to invest their capital with a local partner in the form of joint venture. The restrictive regulations also had the aim to speed up the process of transfer of shares to the Indonesian partners of investors. However, in the later years the end of oil boom and other crisis forced the Indonesian government to deregulate the economy and to adopt more liberal policies to attract foreign investment in the country.
From the introduction of the Foreign Investment law in the year 1967 until today, the level of Foreign Investment approved has reached the mark of US$ 234.147,8 million. The number of projects being approved by this time has reached to the point of 9.784 Projects. These projects are mainly established in the sectors of Oil & Gas, Mining, Banking and Financial Services. The major investing partners of the Indonesian economy are Japan, UK, Singapore, Hong Kong, China, Taiwan, USA, Netherlands, South Korea, Germany and Australia. The companies from these countries have invested in about 24 major sectors including Trade, Industry, Property, Plantation, Services, Infrastructure, Construction, Fishery, and Franchises. The main hub for foreign direct investors is the island of Java. Though, the islands of Sumatra, Kalimantan, and Sulawesi are also of significant importance but their importance is secondary.
http://www.expat.or.id/business/companyestablishment.html
http://esf.niwi.knaw.nl/esf1997/projects/indonesia/investment/other/frame.html
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