RI investment approvals reach record level

RI investment approvals reach record level

JAKARTA (JP): Investment approvals reached their highest level
this year with foreign investment commitments increasing by 68.4
percent to US$39.9 billion and domestic commitments by 31.1
percent to Rp 69.9 trillion ($30.3 billion).

"I think this year's record of foreign investments is simply
too high and I'm afraid that investment approvals may decline in
the coming years," State Minister of Investment Sanyoto
Sastrowardoyo told a press conference here yesterday.

He explained that this year's foreign investments approved by
the government up to yesterday were committed for the
establishment of 799 new or expansion projects in the non-oil and
non-financial sectors.

The projects, when operational, are expected to employ 361,553
people, comprising 353,172 Indonesians and 8,381 foreigners, he
said.

For comparison, foreign investments approved by the government
in 1994 reached $23.7 billion for 449 projects with plans to
employ 353,172 people, including 7,161 foreigners.

Sanyoto noted yesterday that the petrochemical industry was
the largest sector to attract foreign investments this year, with
commitments of $19.3 billion, followed by the transportation
business, with $5.5 billion, the power generation and water
supply, with $3.5 billion, and the paper industry, with $2.5
billion.

Out of this year's foreign investment projects, 468 were
export-oriented, with commitments to export part of the products
to generate foreign exchange revenues of $15.7 billion per annum,
he said.

Sanyoto, who is also chairman of the Investment Coordinating
Board, said that Britain emerged as the single largest foreign
investor this year with total investment commitments of $6.32
billion, followed by Japan with $3.79 billion, Australia with
$3.71 billion, the United States with $2.77 billion, Hong Kong
with $1.76 billion, Singapore with $1.46 billion and Germany with
$1.34 billion.

However, cumulatively during the period between 1967 and 1995,
Japan remained the largest foreign investor with total investment
commitments of $27.11 billion, followed by Britain with $20.72
billion, Hong Kong with $16.36 billion, Singapore with $15.02
billion and the United States with $11.51 billion, he said.

The investment chief also disclosed that the number of foreign
investment licenses revoked in 1995 declined to 16, with total
investment commitments of $68.29 million, from 33 licenses with
commitments of $179.34 million in 1994.

Sanyoto said that this year's domestic investments were
committed for the establishment of 775 new and expansion
projects.

Out of the domestic projects, 338 planned to export part of
their products to earn $12.71 billion per annum after the start
of their operations, he said.

He said this year's domestic investment projects, when
operational, will employ 650,000 people, including 3,456
foreigners.

In 1994, the government approved 823 domestic projects worth
Rp 53.3 trillion, with commitments to employ 623,582 people,
including 3,914 foreigners.

Sanyoto said the government revoked licenses for 77 domestic
investment projects worth Rp 1.6 trillion this year, as compared
to the 129 projects worth Rp 4 trillion canceled in 1994.

He noted that the realization of cumulative foreign investment
plans improved to 55.2 percent as of this year from 52 percent as
of last year, while that of domestic investments rose to 44.6
percent from 42.8 percent.

The minister said that the inflow of foreign investments into
Indonesia in 1996 will likely decline from this year's level due
to tighter competition from other developing countries, such as
Vietnam and China. (kod)