Investment Rises 13.7% in Q2

Investment realization development from 2014 to Q2 of 2019 (Photo by: BKPM)

The Investment Coordinating Board (BKPM) has published investment data for the second quarter of 2019 with a total investment of Rp200.5 trillion, a 13.7 percent increase over the same period last year.

The investment realization value in the second quarter reached 25.3 percent of the investment target in 2019 (Rp792.0 trillion).

“Investment in this period managed to provide employment for 255,314 people,” Head of BKPM Thomas Lembong said at a press conference at the BKPM office in Jakarta, Tuesday (30/7).

The investment value during the second quarter of 2019 for Domestic Capital Investment (PMDN) amounted to Rp95.6 trillion and Foreign Capital Investment (PMA) amounted to Rp104.9 trillion.

“During the first quarter of 2019, the number of Indonesian workers getting employment reaches 235,401 people,” Lembong added.

Lembong added that the investment realization of Domestic Capital Investment (PMDN) in the second quarter of 2019 increased by 18.6 percent compared to that of the same period last year, amounting to Rp95.6 trillion, while realization of Foreign Capital Investment (PMA) increased by 9.6 percent to Rp104.9 trillion.

PMDN and PMA projects, according to him, contributed to 141,153 and 114,161 workers absorption, respectively.

The realization figures for the second quarter of 2019, Lembong added, increased by 2.8 percent compared to that in the first quarter.

“This indicates an opportunity to increase investment realization after the first semester (January-June). Of course, this is inseparable from the increasingly stable domestic political conditions after President-elect and Vice President-elect for the period of 2019-2024 were named,” Lembong stated.

Meanwhile, investment realization during the first semester of 2019, according to Lembong, amounted to Rp395.6 trillion. The figure consists of PMDN realization which increased by 16.4 percent compared to that of the same period last year, amounting to Rp182.8 trillion and PMA realization which increased by 4.0 percent to Rp212.8 trillion. In addition, the total Indonesian labor absorption reached 490,715 workers.

“Investment in the first semester of 2019 is still dominated by infrastructure sector, such as transportation, telecommunication, power plants, and construction. We can also see that the infrastructure investment, which requires a large budget and also multi-years in nature, continues to be realized in this global and regional economic conditions, which are full of challenges and uncertainties,” Lembong said.

When it comes to the spread of investment, investment realization in Java during the first semester of 2019 increased by 5.8 percent compared to that in the same period of 2018 (Rp206.2 trillion), amounting to Rp218.1 trillion. Meanwhile, investment realization outside Java increased by 14.2 percent compared to that in last year (Rp 155.4 trillion) amounting to Rp177.5 trillion.

Based on project location, the top five provinces which reported the highest investment realization are West Java (Rp68.7 trillion, 17.4 percent), Special Capital Region of Jakarta (Rp54.5 trillion, 13.8 percent), Central Java (Rp36.2 trillion, 9.1 percent), East Java (Rp32.0 trillion, 8.1%); and Banten (Rp24.6 trillion, 6.2 percent).

“It is encouraging that the investment realization outside Java increased relatively higher than that in Java, this semester. Hopefully, this circumstance can further continue to establish balance of regional growth in Indonesia,” Lembong said.

At the same time, top five countries with the largest investment realization are Singapore (US$3.4 billion, 23.9 percent), Japan (US$ 2.4 billion, 16.9 percent), China (US$2.3 billion, 16.2 percent), Hong Kong (US$1.3 billion, 9.2 percent), and Malaysia (US$1.0 billion, 7.0 percent).

Furthermore, the top five realization based on business sector during the first semester of 2019 are Transportation, Warehouse, and Telecommunications (Rp71.8 trillion, 18.0 percent), Electricity, Gas, and Water (Rp56.8 trillion, 14.4 percent), Construction (Rp32.0 trillion, 8.2 percent), Food Industry (Rp31.9 trillion, 8.1 percent), and Housing, Industrial Estate, and Offices (Rp31.0 trillion, 7.8 percent).

In the future, Lembong concluded, BKPM will improve monitoring of Business Licensing realization through the Online Single Submission (OSS) system, including facilities for solving problems faced by businessmen. (PR of BKPM/ES)

Translated by : Fairuzzamani Inayatillah
Edited by : Muhardi, M. Ersan Pamungkas