T

welve foreign companies that have invested in the labor-intensive industry have started production, contributing significantly to national exports and absorbing thousands of workers, according to the Investment Coordinating Board (BKPM).

The 12 companies are among 100 firms whose business licenses were obtained between 2010 and March this year. Despite the permits, the companies could not immediately start construction, until the BKPM offered assistance early this year.

Azhar Lubis, deputy director for investment monitoring and implementation at the BKPM, said the companies had contributed Rp 80.7 trillion (US$5.5 billion) in investments, $513 million in exports and had employed 9,280 people.

'€œThey are labor-intensive sectors that could help develop disadvantaged regions and boost other sectors. The workers will increase spending on transportation, food and beverages because of it,'€ he said during a dialogue titled '€œThe Dynamics of 100 Investments'€ at the BKPM office in Jakarta on Thursday.

According to BKPM, the 12 companies are a power plant in West Fakfak, West Papua; two rubber manufacturers in Batanghari, Jambi and Palembang, South Sumatra; a petrochemicals producer in Cilegon, Banten; two garment factories in Sukoharjo and Wonogiri, both in Central Java; a fishery company in Semarang, Central Java; a cement maker in Gresik, East Java; two hotels and a cottage/office in Badung, Bali; and a hotel in West Manggarai, East Nusa Tenggara.

The 100 companies, meanwhile, are worth Rp 219.7 trillion and are projected to directly employ 65,000 workers and have a multiplier effect on 240,000 others.

Of the projects, 64 are in the industry sector, worth Rp 145.53 trillion; 14 are power plant constructions with a total capacity of 2,295 megawatts (Rp 44.08 trillion); six plantation projects (Rp 13.5 trillion); 11 in tourism (Rp 3.51 trillion); three in the transportation sector (Rp 6.56 trillion); an animal husbandry project (Rp 310.41 billion); and a mining project (Rp 6.15 trillion).

Seventy of the projects are in Java and 30 outside Java.

Azhar said the monitoring of the 100 was part of efforts to reach the government'€™s ambitious investment target, which has increased by 115 percent from the previous five-year goal of Rp 1.6 quadrillion to Rp 3.5 quadrillion over the next five years.

'€œTo reach such an ambitious goal, we cannot do business as usual, thus the close monitoring. We'€™ll have another 100 investment projects to watch soon and we project to have domestic companies too,'€ he said, adding that the government had broken down the target into yearly goals.

This year is Rp 519.5 trillion while next year is Rp 594 trillion.

Ahmad Erani Yustika, the Villages, Disadvantaged Regions and Transmigration Ministry'€™s director general for development and empowerment of villagers, said investment was a way to develop villages.

The ministry recorded that 23,000 of 47,000 villages in Indonesia were disadvantaged, he said. His directorate has targeted to raise 5,000 of them to '€œdeveloping'€ status and 2,000 that are currently developing to '€œdeveloped'€ by 2019.

'€œThe government should also focus on boosting domestic investment because currently the investment is dominated by foreigners. Although globalization is inevitable, we have to secure important sectors related to public welfare for domestic companies,'€ Erani said.

He emphasized the importance of regional administrations'€™ commitment and cooperation in creating a conducive environment and developing domestic businesses, including self-employed farmers and fishermen.

'€œThe effectiveness of recent policy packages and deregulation depend a lot on regional implementation,'€ Erani said. (rbk)