Fri, 30 Jun 2000

Foreign investment has yet to recover

JAKARTA (JP): Despite an increasing number of foreign investment projects, the capital may see a decline in investment value this year, an official said on Thursday.

Chairman of the Jakarta office of the Regional Investment Coordinating Board (BKPMD) Albert Napitupulu told The Jakarta Post that sluggish foreign investment might be connected to foreign investors' careful stance in observing the political and security conditions in the country and the capital as well.

"The prevailing unstable political and security conditions in the country still affects foreign investment in the capital," he said.

"It's likely that they (foreign investors) are still adopting a wait-and-see approach in doing business here," he added.

Napitupulu said his office records showed that Japan, Singapore, Hong Kong, the Netherlands, Great Britain and the United States were among the top 10 countries in terms of investment value here.

Office data also reveals that as of May 2000, the capital had secured 186 foreign investment projects worth some US$131 million, while last year's overall figure showed a total of 429 projects secured with $777 million in value.

Napitupulu said all investment schemes, which were secured until May this year, included projects in the garment industry, tourism, telecommunications services and trading sectors.

"The figures reflect foreign investors' eagerness to take part in local business sectors. They are just waiting for the right time and avoiding security and political instabilities from jeopardizing their investment," Napitupulu said.

He said his office was expecting a total of $316.5 million in foreign investment value by the end of this year.

"While next year, we hope to secure a total foreign investment value of $362.4 million," he added.

The figures are in sharp contrast to those of 1996, which saw 294 foreign investment projects totaling $3.75 billion.

Napitupulu said his office would prioritize the development of business sectors which would help accelerate the establishment of Jakarta as a service city, such as in trade, services, tourism and selected industries.

Asked what he meant by selected industries, he said they were those that would not pollute the environment nor require a large area, and are high tech and export oriented.

He said his office also targeted to boost the development of seven business locations in the capital which are economically strategic, such as the Kuningan golden triangle and Kemayoran fairgrounds as international business locations; Sunda Kelapa and Kepulauan Seribu (Thousand Islands) marine resort for tourism; and the Sudirman central business district as well as Pulogadung- Cakung industrial-bonded zone for selected high tech industries.

The administration, he said, would make efforts to lure foreign businessmen by providing simpler investment application procedures through a one-stop-service program, especially for the issuance of foreign investment approvals.

"They can come to our office directly or to our representative offices abroad," he said.

Napitupulu said the one-stop-service program was expected to help increase the number of foreigners investing in the years to come.

"The program is also in line with the implementation of regional autonomy, which aims at creating a conducive business environment for both foreign and local investors," he said. (06)