Foreign investment fell 77% in first half<\/p>\n
JAKARTA (JP): Foreign direct investment approved by the
\ngovernment in the first six months of this year plunged by 77.5
\npercent to US$1.88 billion, from $8.35 billion during the same
\nperiod last year.<\/p>\n
According to data from the Investment Coordinating Board
\n(BKPM), licensed domestic investment in the same period dropped
\n36.07 percent to Rp 19.12 trillion, from Rp 29.9 trillion in the
\nfirst semester of 1998.<\/p>\n
Asril Noer, an assistant to the state minister of investment,
\nsaid over the weekend the number of approved foreign investment
\nprojects in the period, however, rose by 7.5 percent to 518
\nprojects, from 482 projects, despite a sharp drop in their value.<\/p>\n
Approved domestic investment projects fell to 102 in the first
\nsix months of this year, from 169 projects in the corresponding
\nperiod last year.<\/p>\n
"However, we should be aware that not all of the approved
\ninvestment projects will be implemented," Asril, who is also
\nBKPM's secretary added.<\/p>\n
He said the increase in the number of approved foreign
\ninvestment projects indicated a shift in investors' interest from
\nlarge-scale projects in previous years to medium-scale projects.<\/p>\n
Asril said most of the projects were in export-oriented
\nindustries which used natural resources, namely agribusiness,
\nfisheries, the food industry, plantations and mining.<\/p>\n
Japanese investors topped the list, committing more than $135
\nmillion in investment as of the end of May. They were followed by
\ninvestors from South Korea and Australia.<\/p>\n
He said the government had improved the investment climate for
\ndomestic as well as foreign investors by issuing several new
\nderegulation measures.<\/p>\n
"One of them is the delegation of authority to governors and
\nBKPMD (provincial investment offices) for issuing domestic
\ninvestment approval."<\/p>\n
As the chairman of the Investment Planning Board, State
\nMinister of Investment Marzuki Usman could now approve investment
\nprojects worth up to $100 million, Asril said. Investments worth
\nmore than $10 million previously required the direct approval of
\nthe President.<\/p>\n
Marzuki said the government planned to give permanent resident
\nstatus to foreigners with a total investment of at least $1
\nmillion in the country. He said the status would allow them to
\nenter Indonesia without a visa.<\/p>\n
BKPM's vice chairman Andung A. Nitimihardja said separately on
\nFriday that BKPM had authorized its provincial offices (BKPMD) in
\neight provinces to license domestic investments as a pilot
\nproject to speed up licensing procedures.<\/p>\n
The investment offices in West Java, Jakarta, Central Java,
\nYogyakarta, East Java, North Sumatra, East Kalimantan and South
\nSulawesi, would be allowed to approve all domestic investment
\nprojects.<\/p>\n
"The pilot project will start later this month," he told
\nAntara.<\/p>\n
He said previously BKPMD were only allowed to approve domestic
\ninvestment projects valued at up to Rp 10 billion.<\/p>\n
Last year, foreign direct investment fell by 60 percent to
\n$13.6 billion, from $33.83 billion in 1997.<\/p>\n
However, in the same period the number of foreign investment
\nprojects rose by 23.7 percent to 1,035 projects, from 790
\nprojects in 1997.(gis)<\/p>",
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