Foreign investments exceed domestic ones

Foreign investments exceed domestic ones

JAKARTA (JP): Approved foreign investments in Indonesia, recorded at US$15.6 billion (Rp 34.5 trillion) in the first four months of this year, for the first time ever overtook approved domestic investments, which reached Rp 20.74 trillion.

"This shows that foreign investors are interested in our country...It means that our country has a conducive investment climate," State Minister of Investment Sanyoto Sastrowardoyo told reporters after a meeting with President Soeharto at the Merdeka Palace yesterday.

The minister, who also chairs the Investment Coordinating Board, said that the foreign investments indicated a 468 percent increase from $3.3 billion in the same period last year.

Sanyoto said last month that Indonesia's foreign investment approvals during the first quarter reached $12.9 billion.

His statement yesterday also indicated that there was a $2.7 billion increase in the approval of foreign projects within a one month period.

Approved foreign investments were recorded at $23.7 billion in 1994, as compared to $8.1 billion in 1993.

"These figures prove that Indonesia is not a high risk country for foreign investment...the figures speak for themselves," Sanyoto said.

Analysts and businessmen have said that Indonesia's rapid growth in foreign investment was driven by a deregulation package in June 1994 which scrapped a law which forbade foreigners from outright owning a wide range of industries.

Sanyoto said yesterday that the country needed at least $39 billion in foreign investment to be approved annually to support a 6.2 percent average economic growth in the years to 1999.

Sanyoto also said yesterday that Australia had substantially increased its investments in Indonesia.

"Within the first four months of this year alone, investment projects coming from Australia reached $3.4 billion," he said.

Available data shows that between 1967 and 1994, Australian investments in this country reached a mere $2.01 billion.

Official figures show that the list of foreign investors in 1994 was topped by Hong Kong, with total commitments of $6.04 billion, Britain with $2.95 billion and Taiwan with $2.48 billion.

Sanyoto said yesterday that he would visit Canada and the United States next week, along with 30 business executives, to promote foreign investment. (hdj)