Gov’t to Designate Kendal Industrial Estate, Nongsa Digital Park as New SEZs

Coordinating Minister for the Economy Darmin Nasution and Foreign Minister Retno Marsudi deliver a press statement at the Sangri-la Hotel, Singapore, Tuesday (9/10). (Photo by: Anggun/PR)

The Government has announced it will designate Nongsa Digital Park in the industrial island Batam in Riau Islands province and Kendal Industrial Estate in the Central Java town of Kendal as new Special Economic Zones (SEZs).

Speaking to reporters in Singapore on Tuesday (8/10), Indonesian Coordinating Minister for the Economy Darmin Nasution said that the designation of these two as SEZs is expected to provide better their infrastructure there and to  boost investment.

“As a digital park, the Nongsa Digital Part will certainly be focused on digital aspects, including education,” he said.

For Kendal Industrial Estate, according to Darmin, the Singaporean Government considers it less attractive despite many investments.

Therefore, to boost investment there, Darmin said that Singaporean Prime Minister Lee Hsien Loong during discussions at the last Leaders’ Retreat in Bali on 11 October last year proposed to change it to SEZ.

“Indeed, it takes time to prepare for it. A government regulation bill has been harmonized at Ministry of Law and Human Rights and it will be signed by President Joko “Jokowi” Widodo in a matter of days,” said Darmin.

Regarding the long time to develop Kendal Industrial Estate SEZ, Darmin said there are several considerations that the new SEZs are expected not to be concentrated in Java Island.

“In Java, we are focusing on developing tourism SEZs such the Tanjung Lesung SEZ and the Singhasari SEZ in Malang,” he said, adding that the Government will also develop SEZs in Java as long as they meet a number of requirements such as focusing on exports, having import substitution and adopting leading-edge technology.

“The Government Regulation bill has been completed and I have also reported it to the President earlier at the meeting. I believe the President will sign it in couple days ahead,” said Darmin.

Darwin went on to say that an investment working group has been established as part of the preparation to develop Kendal SEZ; thus, it is expected that more Singaporean and domestic investors will be attracted to invest in Indonesia.

“Investment in the Kendal Industrial Estate SEZ amounts to USD555 million and the SEZ provides more than 2,400 jobs. It will also adopt higher technology or become more export oriented,” said Darmin, adding that a number of working groups have also been established in transportation and agribusiness fields.

As for tourism, new Singapore-Indonesia shipping routes have been opened in addition to the existing routes that have been available so far, particularly for the Genting Dreams cruise to Indonesia’s Belitung island starting in Summer next year.

“For the very first time, a cruise ship with a capacity of 3,000 passengers will dock in the island of Belitung. We hope it will also drop by Mandalika and Labuan Bajo, as well as in other tourist destinations (in Indonesia),” he said. (RSF/GUN/ES)

Translated by: Muhardi

Edited by: M. Ersan Pamungkas