The deputy chairman of the Investment Coordinating Board said on Monday that the Netherlands was the No. 1 investor in Indonesia over the past six months, although he declined to state the actual value of the investments.
“We have the Netherlands as the No. 1 investor, followed by Singapore and South Korea,” said Yus’an of the BKPM during a hearing with the House of Representatives’ Commission VI. A small island country, the Seychelles, and Britain round out the top five this year.
The Seychelles, an archipelagic nation of 115 islands in the Indian Ocean, some 1,500 kilometers east of mainland Africa, is a well-known offshore tax haven and a favorite location for the incorporation of special purpose investment vehicles.
Dutch investment focused on the hotel, textiles, and iron and steel sectors, while Singaporean companies invested in the trade, electricity and water sectors, and South Korean firms in the iron ore and construction sectors.
Regarding the Seychelles, Yus’an commented: “So, there may be Indonesians setting up a companies there and then investing in Indonesia.”
An example is Northstar Equity Partners, an Indonesian financial firm affiliated with Texas Pacific Group. Northstar is managed by Patrick Walujo and is also affiliated with Seychelles-based Piper, Price & Company, which recently signed a Rp 4.25 trillion ($392 million) debt restructuring deal with PT Bakrie & Brothers, the investment company controlled by the Bakrie family.
However, Yus’an decline to give specific figures, saying they would be announced in the coming days by Muhammad Lutfi, chairman of the Investment Coordinating Board (BKPM).
Last month, the BKPM slashed its foreign and local direct investment growth forecast for this year to 9 percent from between 10.7 percent and 11.2 percent in its previous forecast, because of tight liquidity resulting from the global financial crisis.
Lutfi said that the board had cut its forecast after it saw that FDI inflows in April were quite low compared with the same period last year.
Lutfi said that despite slow FDI realization in April, Indonesia had so far secured $7 billion worth of FDI investment commitments in the mining and oil and gas sectors this year, which he said would be realized between 2011 and 2012.
BKPM data showed that actual domestic investment in April jumped to Rp 1.51 trillion ($142 million) from Rp 680 billion in the same period last year.