Indonesia Records Rp210.7 Trillion of Investment in Q1 2020: BKPM

By Office of Assistant to Deputy Cabinet Secretary for State Documents & Translation     Date 21 April 2020
Category: News
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Investment realization data. Image source: the BKPM

Investment in the first quarter of 2020 is recorded at Rp210.7 trillion, 8.0% higher compared to that of the 2019 first quarter, the Investment Coordinating Board (BKPM) has reported.

“The first quarter of this year was quite tough because of the COVID-19 outbreak, but thank God we achieve the target. In fact, there was an 8% increase compared to that of last year,” Head of the BKPM Bahlil Lahadalia said.

According to Lahadalia, investment value in the first quarter had reached 23.8% of the overall 2020 investment target (Rp.886.1 trillion).

The large increase of this quarter, he added, is generated by domestic investment (PMDN) which increased by 29.3%. Domestic investment is recorded at Rp112.7 trillion this year, higher than that of the previous year with Rp87.2 trillion, while foreign direct investment in the first quarter of 2020 is Rp98.0 trillion, 9.2% lower from the 2019 first quarter investment (Rp107.9 trillion).

Furthermore, total domestic labor absorption in this quarter reached 303,085, higher than the first quarter of 2019 with 235.401 workers employed.

“This is good news because we have more employment this year. We have been asking the companies to avoid layoff during the COVID-19 pandemic. This is important to stabilize Indonesia’s economy,” Bahlil said.

Bahlil went on to say that the COVID-19 pandemic is challenging to the FDI (Foreign Direct Investment) in the first quarter of 2020.

“We hope that foreign and domestic companies can survive and will be able to implement rules and regulations set by the Government. We continue to oversee investment projects and to facilitate debottlenecking, especially amid the current situation” he said.

Within the first quarter of 2020, domestic and foreign investments in the regions outside Java increased significantly by 19.3 %, with the value of Rp102.4 trillion, higher than investment realization in the same period last year (Rp 85.8 trillion).

At the same time, investment in Java slightly dropped from Rp.109.3 trillion in 2019 to Rp.108.3 trillion in 2020.

The BKPM also notes that the top five regions for investment realization are: East Java (Rp.31.4 trillion, 14.9%), West Java (Rp.29.9 trillion, 14.2%), DKI Jakarta (Rp.20.1 trillion, 9.6%), Central Java (Rp.19.3 trillion, 9.1%), and Riau (Rp.12.8 trillion, 6.0%).

“Another good indication is the investment realization occurred in Eastern Indonesia, which grew by 19.3% compared to that in the first quarter of 2019. It was generated by mining processing product sector, after the nickel ore export ban applied in the end 2019. We continue to boost investment in the regions outside Java” Bahlil said.

Foreign and Domestic investment realization in this quarter is dominated by the sectors of Transportation, Warehouse, and Telecommunication (Rp49.3 trillion, 23.4%); Basic Metal, Metal Based Goods, Non-Machinery and Equipment Industry (Rp24.5 trillion, 11.6%); Electricity, Gas, and Water Supply (Rp18.0 trillion, 8.6%); Housing, Industrial Estate, and Office Building (Rp17.8 trillion, 8.4%); and Food Crops, Plantation, and Livestock (Rp 17.2 trillion, 8.2%)

The top five leading countries with the largest Foreign Direct Investment are Singapore (US$2.7 billion, 40.0%), China (US$1.3 billion, 18.9%), Hong Kong (US$ 0.6 billion, 9.3%),  Japan (US$ 0.6 billion, 8.9%) and Malaysia (US$ 0.5 billion, 7.1%).

Through the implementation of “Large Investment Project Execution” program, the BKPM is committed to overseeing the investment projects, including by providing permit and solving problems on the ground such as land acquisition.

“We continue to work with other ministries/institutions to continuously overcome obstacles faced by companies, especially in the midst of the COVID-19 pandemic. This is not an easy thing to do, but we are optimistic this outbreak will end soon and the economy will rebound,” Bahlil said. (PR of the BKPM/EN)



Translated by: Ridwan Ibadurrohman
Reviewed by: Muhammad Ersan Pamungkas

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