Tue, 08 Jun 2010

President Susilo Bambang Yudhoyono will sign a decree this week easing restrictions on foreign investment in 40 sectors of the domestic economy, Investment Coordinating Board Chairman Gita Wirjawan announced on Monday.

“I guarantee you it will be out this coming week,” Gita said in an interview at the World Economic Forum in Ho Chi Minh City. “I was with the president. It was on top of the deck on his table. He said he would sign it in a day or two.”

The decree would ease some restrictions in the country’s so-called negative investment list (DNI), which limits foreign ownership in companies in some sectors.

Health care and education are among the industries in which increased foreign investment will be permitted, Gita said. A 2007 presidential decree was “a little bit confusing” and subject to multiple interpretations, he said.

“This one takes a completely sectoral approach to the extent that foreign investors know the extent to which they can invest in any particular sector, whether it’s education, agriculture, logistics, or the creative industries,” he said. “We have decided to liberalize 40 sectors.”

In March, Gita said the government planned to unlock more sectors of its economy to overseas investors, but would not allow foreign investment in telecommunication towers. There has been fierce resistance from local stakeholders to proposals to open up multibillion-dollar investment in such areas as base towers for mobile phones.

In health care, foreign investors would be allowed to own up to 67 percent of hospitals across the country, he said. Previously, foreign ownership in hospitals had been restricted to a few cities such as Surabaya and Medan.

Foreign companies will also be allowed to have a maximum ownership of 49 percent in plantations producing staple foods such as rice, as well as cargo services and film businesses, Gita said.