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Historic Foreign Direct Investment - 1999 - 2000

Since the Foreign Investment Law was enacted in 1967, Foreign Direct Investment (FDI) has reached an approved total value of US$ 234.147,8 million and the number of approvals has reached 9,784. Projects include exclusive investment in Oil & Gas, Mining, Banking and Financial Services.

FDI 1999 & 2000

The ten leading foreign investing countries in Indonesia are Japan, England, Singapore, China, Taiwan, USA, the Netherlands, South Korea, Germany and Australia which have invested in 24 sectors, including Trade, Industry, Property, Plantations, Services, Infrastructure, Construction, Fisheries and Franchises.

The Island of Java is the primary recipient of FDI, followed by Sumatera, Kalimantan and Sulawesi.

The government of Indonesia is undergoing a process to deregulate the present investment law, and planning to reform the national investment policy by:

• Providing equal treatment for both domestic and foreign investors.
• Weighing the consequences of the implementation of regional autonomy.
• Huge foreign investment projects in the field of mining are now treated as if they had a special legal basis (lex specialize).
• The Investment Board Chief's, Theo F. Toemin, visit to 17 countries in December 2001 revealed that security was not the primary issue for investors, but that competitive advantages of Indonesian taxes, equal treatment, and the recent Autonomy Laws No. 22 and 25 were.
• The size of investments dropped from US $ 9.027,6 million in 2000 to US $ 14.933 in 2001, and the number of approved projects dropped from 1.433 to 1.317. The main reasons for this were the unstable economy, security and law enforcement, and the recent attacks on September 11^th.
• The outlook for 2002 is an estimated growth from 3.5 to 4 percent, weak investments until late in 2001, and a slight increase in size in the third and fourth quarters of 2002. Foreign Investment have still kept away in droves because of the country's unpredictable business climate.
• The 2002 RI stable economic condition estimates are not enough to generate the investment needed to effectively fight poverty, in addition to the increasing utility prices and a lack of incentive to stimulate local investment. Poverty may increase in 2002 and local investment will remain weak, while the recovery rate of Indonesian growth will remain at 7 to 8 percent. Heady investment will be observed in 2004.

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