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ublicly listed lender Bank Mandiri predicts that the growth of foreign direct investment will falter next year as uncertainty in the global economy will continue to affect the flow of foreign capital.

Mandiri chief economist Destry Damayanti said the bank projected that FDI in Indonesia would grow between 15 and 18 percent in 2014, below the 20 percent growth estimated this year and the 26 percent in 2012.

'€œThe growth of FDI will be lower than the 20 percent forecast in 2013. We have also seen a slowdown in FDI in the last quarter,'€ she announced on Thursday.

Analysts predict that in addition to uncertainty in the global economy, investors will also halt their investments in the country next year as they will wait for the results of the general and presidential elections, which will be held in April and July next year, respectively.

Data from the Investment Coordinating Board (BKPM) shows that the total amount of realized FDI surged 26.1 percent year-on-year to reach Rp 221 trillion (US$19.4 billion) in 2012. The BKPM expects FDI in 2013 to reach Rp 272.6 trillion, 23.3 percent higher than a year ago.

The board reported recently that realized FDI fell from $7.2 billion in the second quarter to $7 billion in the third quarter this year, the first quarter-on-quarter decline since 2011. That still represented a rise of more than 18 percent compared with the third quarter of last year.

However, contrary to FDI, the inflow of foreign portfolio investment in the capital market is expected to rise as interest rates are forecast to decline, according to Destry.

'€œThe inflation rate is estimated to fall to about 5 percent in 2014, and with lower inflation, we hope to see lower interest rates as well. We estimate that interest rates will drop between the third and fourth quarter after the elections are over. That will be an upside for bond investors,'€ Destry said, adding that '€œplain vanilla'€ government bonds would remain the most preferred investment.

Meanwhile, in an effort to spur investment in the country, Mandiri will hold an investment forum in Jakarta on Nov. 11 and 12. Mandiri finance and strategy director Pahala N. Mansury said that the forum was expected to facilitate potential investors'€™ needs as it would bring together hundreds of domestic and global investors and companies, which are major players in the industry.

'€œWe are bringing in 400 investors, including fund managers who handle around $3.1 trillion in portfolio investments globally,'€ he said, adding that the lender was cooperating with subsidiary Mandiri Sekuritas and Goldman Sachs in holding the event.

Mandiri also expects its lineup of speakers '€” such as Finance Minister M. Chatib Basri, Trade Minister Gita Wirjawan, Bank Indonesia senior deputy governor Mirza Adityaswara and renowned US economist Nouriel Roubini '€” to provide investment insights during the forum, in which investors will get a chance to have a one-on-one meeting with dozens of publicly listed firms.

'€œThis [the forum] is part of our economic diplomacy as we believe that Indonesia still offers large economic potentials in the long term,'€ Pahala said.