The uncertainties in the global economy have had a negative impact on the inflows of foreign direct investment (FDI) into the country.
According to the data issued by the Investment Coordinating Board (BKPM), the realization of the FDI dropped by 20 percent to Rp 89.1 trillion (US$6.17 million) in the third quarter from Rp 111.7 trillion in the same period last year.
But the government should not make global economic uncertainties the scapegoat for the fall of FDI inflows. Indonesia should instead continue its efforts to further improve the business climate.
The government has issued a series of economic policy packages to improve the ease of doing business during the last three years. However, many of the deregulation measures have not been fully implemented. This partly contributed to the fall in the country’s ranking in the 2019 Ease of Doing Business (EoDB) index issued by the World Bank.
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