Priority Sectors for Investment in Indonesia

   

The government of Indonesia is committed to boosting the nation’s investment trend. Efforts have been made to speed up the licensing process, special incentives for investors, ease of access, as well as a priority investment list. This is done to invite more investors to participate in the country’s growth, thus taking Indonesia’s investment trend to a whole new level.

Be a part of a propitious future by investing in the priority sectors for investment in Indonesia. Below we have listed six prospective sectors that have shown consistent and rapid growth over the years. These sectors have a favourable business environment that allows investors to dig into more potential growth. Aside from that, earlier this year the government has also prepared an investment priority list to aid investors when investing in Indonesia.

Six Priority Sectors in Indonesia

As a nation, Indonesia has a dream to be a country with the biggest economy in the world by 2030. To reach this goal, the government has arranged six priority sectors for investment in Indonesia.

The six priority sectors that the government has arranged to be developed further are health, electronics, renewable energy, infrastructure, automotive, and mining. These sectors have had steady growth over the years, making them a major hit for investment. The six sectors chosen are complete in the sense that it pushes the economy to grow based on industry and services.

Covid-19 has brought the perfect momentum for Indonesia to accelerate its digitalization in the 4.0 digital era. Indonesia has participated in the Hannover Messe as an official partner country with the theme Making Indonesia 4.0. It is greatly hoped that small industries will be interested in participating in using digital technology for their business.

Open Sectors for Investors

An investment priority list has been launched by the Indonesian government under Presidential Regulation No. 10 Year 2021. This list shows which industries are open for investment, and is a helpful tool considering there are about 20 sectors that have been put on the negative investment list. The main goal of the list is to aid investors in the sectors that are open to investing in Indonesia.

Investors that invest in these priority sectors are eligible to receive incentives. The incentives are tax holiday, tax allowance, import duty redemptions. Aside from that, investors can get non-fiscal incentives in the form of ease in obtaining business licenses, work permits, supporting infrastructure, and guaranteed energy supply or raw material.

The investment priority list has a total of 14 sectors that are open for investors. The regulation expands over 245 business lines, which includes a few important sectors. These important sectors are transportation, energy distribution, construction services, media, and telecommunications.

There are three classifications present within the list, which are: First, the list of priority business sectors. There are specific criteria for a business enterprise to be classified as a priority sector. Second, the list of sectors allocated for cooperatives, as well as micro, small, and medium-sized enterprises (MSMEs). Third, a list of sectors that stipulate specific requirements or limitations.

Prospective Sectors for Investment

Other than those mentioned above, there are a few sectors that have great prospects for future development. These sectors are manufacturing, tourism, e-commerce, and infrastructure. The manufacturing industry will surely be a huge investment for improving the facilities needed by the citizens of Indonesia. Having more facilities will give the people more job vacancies, major distribution improvement, and economic growth.

Tourism is one of Indonesia’s biggest assets. This sector has a higher investment return, thus making it a great option. E-commerce plays an important role in Indonesia’s economic growth, especially since everything is being digitized at the moment. And finally, infrastructure. Better infrastructure will create an opportunity for this nation to improve its living conditions, thus making it a preferable place to stay and start a business.