T

he government remains optimistic of driving more investment regardless of the recent decline in Indonesia’s global competitiveness index, compiled by the World Economic Forum (WEF).

Finance Minister Agus Martowardojo said on Thursday that the WEF report did not fully reflect Indonesia’s actual economic condition.

“The report was made based on a relative comparison survey among different states. A state that only consists of one single island definitely has a different situation than one that has 14,000 islands like Indonesia,” Agus said.

Agus added that Indonesia’s real business climate situation was more objectively depicted in the survey made by rating agencies, such as Fitch and Moody’s, that measured the country using measurable criteria without relatively comparing it with other countries that might have different demographic types and conditions.

“Therefore, I believe investment will still increase. This is marked by the fact that we managed to increase investment by 28 percent in the second quarter this year based on a year-on-year basis. More investments are still in the pipeline and this is a sign that investment will also increase in the second half of the year,” Agus said.

Based on the data from the Investment Coordinating Board (BKPM), total investment in Indonesia amounted to up to Rp 148.1 trillion during the first half of this year.

The board predicted the total investment amount could reach at least Rp 283.5 trillion by the end of the year.

Despite his objection, Agus said that the WEF report was a warning sign for the government to continuously improve the business climate by accelerating bureaucratic reform and establishing firm law enforcement.

The report revealed that Indonesia’s global competitiveness index slipped four places to 50th out of 144 countries, particularly due to inefficient government bureaucracy and corruption, inadequate infrastructure, poor ethics in its national labor force and restrictive labor regulations.

“Bureaucratic reform is an ongoing process and it remains an unfinished program. There will be improvements, such as the establishment of an independent evaluating team to score the quality of the reform,” Agus said.

“In regard to eradicating corruption, the government will maintain a high commitment to do that. We are not only enforcing laws but also providing a corruption prevention system. If we still see many state officials being caught red handed for conducting corruption, then this shows that our system works and will continue to become a part of our strong commitment,” he added.

Separately, National Development Planning Board (Bappenas) head Armida Alisjahbana said that reforming bureaucracy and eradicating corruption was not a one-day job.

“We are working hard to improving our competitiveness. The impact of what we do today might be visible within the next two or three years,” Armida said.