Investment realization this year down: Minister

JAKARTA (JP): The realization of investment approvals in the country will be lower than the initial target due to the currency crisis, State Minister of Investment Sanyoto Sastrowardoyo said yesterday.

Sanyoto said investors, especially from overseas, were still enthusiastic about investing in the country's industrial sector, judging from the inflow of investment applications, but many of the investment commitments had not been realized.

"The applications still come in, but the realization is harder now," Sanyoto was quoted by Antara as saying.

He did not disclose a figure on the amount of foreign investment commitments to be realized.

"It is hard to predict how much will be realized," he said before the meeting of the People's Consultative Assembly.

Speculative attacks on the rupiah has caused it to drop over 25 percent against the U.S. dollar since early July.

A series of government measures have been enforced to stabilize the falling rupiah, including the rise in the interest rates of Bank Indonesia's short-term SBIs. This has caused deposit and lending rates to skyrocket.

The government last month decided to either delay or review projects worth about US$38 billion until the monetary situation returned to normal.

Sanyoto said foreign investors still showed interest in Indonesia during the recent promotion activities conducted by the Ministry of Investment in Europe.

He said a conducive investment climate in the country still prompted European businesses to invest here.

Earlier this year, Sanyoto announced a 36 percent drop in foreign investment approvals in this year's first five months, due to the general election.

Foreign investment approvals in the January to May period of this year totaled $14.4 billion. (das)