Jakarta, 25th January 2021 – Today, Indonesia Investment Coordinating Board (BKPM) has published the investment realization data for October – December 2020 (fourth quarter of 2020) that reached IDR 214.7 trillion or increased by 3,1% compared to the same period in 2019. Based on that achievement, the realization of Domestic Direct Investment (DDI) recorded IDR 103.6 trillion or equal to 48.3% of the total investment realization. Meanwhile, IDR 111.1 trillion of Foreign Direct Investment (FDI) has contributed 51.7% of the total achievement. The Indonesian labors absorption within this period reached 294.780 labors.
Cumulatively, throughout the January - December 2020, Indonesia's investment realization performance reached IDR 826.3 trillion or equal to 101.1% of 2020’s investment realization target (IDR 817.2 trillion), consist of IDR 412.8 trillion (49.9%) of FDI and IDR 413.5 trillion (50.1%) of DDI. That performance successfully absorbed 1,156,361 Indonesian labors from 153.349 investment projects.
"With the hard work by BKPM, even though the national economic condition experienced economic contraction due to the COVID-19 pandemic, the 2020’s investment realization target of IDR 817.2 trillion has been surpassed by approximately IDR 9 trillion with Domestic Direct Investment (DDI) contribution higher than Foreign Direct Investment (FDI). DDI has become the locomotive of investment realization within the COVID-19 period and BKPM provide equal assistance towards both DDI and FDI, as shown by the last five years’ investment realization data of nearly equal investment realization of DDI and FDI,” said Chairman of BKPM, Bahlil Lahadalia, at the fourth quarter investment realization press conference. (January 25th 2021, Jakarta)
Regarding the investment distribution pattern, in the fourth quarter of 2020, the portion of investment realization outside Java Island reached IDR 113.4 trillion (52.8%), bigger than those in Java that worth IDR 101.3 trillion (47.2%). Meanwhile in January – December 2020, investment realization outside Java Island worth IDR 417.5 trillion (50.5%) and investment realization in Java Island worth IDR 408.8 trillion (49.5%).
“This can be seen as an evidence that both FDI and DDI were not solely target Java Island as their main investment destination. Afterwards, aligning with the government’s focus on downstream industry and national economic transformation will boost the investment realization outside Java Island. BKPM committed to provide better investment incentives for investment outside Java Island in order to achieve equal distribution of quality investment throughout Indonesia,” said Bahlil.
Bahlil emphasize that one of the key indicator for investors in choosing their investment destination is the availability of infrastructure. Investment outside Java Island can only be boost with the availability of infrastructure that support the business process of investment projects.
In the fourth quarter of 2020, the transportation, warehouse and telecommunications sector contributed the largest with the amount valued IDR 36.4 trillion (17.0%) and West Java Province recorded the largest realization based on project location, that is IDR 34.1 trillion (15.9%).
“Important notes from the investment realization in fourth quarter of 2020 was the increase of investment realization especially from FDI towards locations such as North Maluku and other eastern Indonesia regions. This condition indicated that foreign investors already been settled for conducting business within regions that previously not perceived as potential investment destination,” said Bahlil.
Accumulative data of investment realization in 2020, shows that the transportation, warehouse and telecommunications sector still contributed as the largest with the amount valued IDR 144.8 trillion (17.5%) and West Java Province recorded the largest realization based on project location equal to IDR 120.4 trillion (14.6%). Singapore which acts as FDI’s hub-country, still ranked 1st as the source of FDI with US$ 9.8 billion (34.1%).
With the pass of The Omnibus Bill on Job Creation, and national vaccination program, Bahlil inform that the investment realization target for 2021 are align with the National Development Planning Agency / Bappenas calculation of IDR 855.8 trillion. However, President Joko Widodo instruct that investment realization in 2021 targeted at the level of IDR 900 trillion.
“We have to loyal and comply with the President’s instruction. BKPM must improve the level of communication with investors in order to accelerate investment realization, while also need to immediately adapt with new strategies for achieving the IDR 900 trillion target within the condition of COVID-19 pandemic,” said Bahlil answering the media.
Download the attachment below to see the full report on investment in Indonesia throughout 2020.