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Jakarta Post
The Jakarta Post
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China likely biggest investor in Indonesia

  • Anton Hermansyah

    The Jakarta Post

Jakarta | Mon, January 25, 2016 | 03:12 pm
China likely biggest investor in Indonesia Investment Coordinating Board (BKPM) has recorded Singapore as the largest contributor of investment in Indonesia with US$5.9 billion, a 20 percent share of total foreign investment in 2015. However, China, in ninth position with $0.63 billion believed to be the biggest foreign investor in Indonesia as Chinese investors often invest in other countries through proxy companies that are based in other countries such as Singapore or Hong Kong.(ptsp.bkpm.go.id)

Investment Coordinating Board (BKPM) has recorded Singapore as the largest contributor of investment in Indonesia with US$5.9 billion, a 20 percent share of total foreign investment in 2015. However, China, in ninth position with $0.63 billion believed to be the biggest foreign investor in Indonesia as Chinese investors often invest in other countries through proxy companies that are based in other countries such as Singapore or Hong Kong. (ptsp.bkpm.go.id)

China, and not Singapore, is believed to be the biggest foreign investor in Indonesia, as Chinese investors often invest in other countries through proxy companies that are based in other countries such as Singapore or Hong Kong.

According to the latest investment realization data from the Investment Coordinating Board (BKPM), Singapore is the largest contributor with US$5.9 billion in investment, a 20 percent share of total foreign investment. China was in ninth position with $0.63 billion despite a 47 percent year-on-year (YoY) increase, the highest growth in the history.

"Chinese investment is sometimes conducted through subsidiaries based in another countries. For instance, the investor of Sokonindo Automobile, the manufacturer of mini pickup DFSK is from the Chinese mainland but registered in Hong Kong," BKPM Director Azhar Lubis said in Jakarta.

Unfortunately, he continued, BKPM could not monitor investments made through the proxy countries.

Most of investments coming from China were for smelters, especially in Southern Kalimantan, such as the construction of the first bauxite smelter in Indonesia. Another mega project in which China is providing investment is the high-speed railway between Jakarta and Bandung.  

"The high-speed train project will increase the amount of China'€™s investment in Indonesia drastically. There will be a big contribution in the supply chain as joint ventures will produce the train engines, carriages as well as spare parts," BKPM Chief Franky Sibarani said. (ags)(+)

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