Major provinces guarantee existing foreign investments

Major provinces guarantee existing foreign investments

JAKARTA (JP): In an effort to woo foreign investors, officials
from the Regional Investment Coordinating Board (BKPMD) of seven
major provinces, including Jakarta, gave their guarantee on
Tuesday to maintain and protect all existing foreign investments
in their respective areas.

Deputy chairman of BKPMD for investment services and
facilitation, Yus'an, said the guarantee was made during a
meeting of senior BKPMD officials from Jakarta, East, West and
Central Java, Yogyakarta, Bali and Lampung at Jakarta's City
Hall.

According to Yus'an, such a commitment from the local
authorities was urgently needed as many existing foreign
investors had started to worry, about the future of their
investments in Indonesia, ahead of next year's implementation of
regional autonomy.

"That is why we want to assure all foreign investors that we
will secure the existing projects and have standard regulations
to avoid uncertainties in the permits issued for foreign
investment," Yus'an told a media conference.

"What have been decided by the government on existing foreign
investments will continue. The regional autonomy will not affect
the projects at all," he remarked.

According to Yus'an, a significant change with regional
autonomy, however, would be that foreign investors would need to
obtain permits issued by regency administrations where the
projects are located.

The provincial authorities, he said, would only have the right
to supervise the process. In order to avoid different policies
(from related government agencies), we would coordinate with the
related parties to formulate standard guidelines which will not
burden the investors," Yus'an said.

For that purpose, he added, the government would set up "one-
roof" services in each regency to settle problems or disputes
related to the investments," he added.

Yus'an, whose office is currently under the Ministry of
Industry and Trade, further said the government realized that
direct investments was the most important factor for economic
recovery.

"We seriously want to convince all foreign investors that the
country is ready and the implementation of regional autonomy will
not cause significant differences," he said.

Yus'an also said standard procedures for investment in all 360
regencies in Indonesia were being discussed by the Ministry of
Home Affairs and his office.

"The standard procedures will be issued in December at the
latest, so there will be similar interpretations of the
regulations in each regency on foreign investment," he added.

"With standard procedures, we hope to have fair competition
among the regencies in attracting foreign investments."

Meanwhile, Jakarta's BKPMD chairman Albert Napitupulu said the
capital recorded a significant growth in investment this year as
compared to last year.

"So far this year, we have 360 contracts for projects from
foreign investors worth US$676,773,480 and 44 from domestic
companies worth Rp 1,323,753,530,000. However only some 30
percent of this have been realized thus far," Albert said.

Last year, the capital had 298 contracts for projects worth
US$524,945,860 from foreign companies and 21 from domestic
companies worth Rp 728,936,550,000. Most of them were in the
trading and service sectors.

"These investors are given three years to fulfill their
contractual obligations before their permits are canceled,"
Albert added. (dja)