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Indonesia pins hopes for growth on direct investment
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Business talk: European Business Chambers of Commerce in Indonesia (EuroCham) deputy chairman Adrian Short (left), Investment Coordinating Board (BKPM) chief Thomas Lembong (center), and National Development Planning Board (Bappenas) head Bambang Brodjonegoro serve as speakers on Feb. 2, 2017, during the EuroCham 2017 economic outlook at BKPM office in Jakarta. (JP/Anton Hermansyah)
T
o achieve its 2017 target of economic growth above 5 percent, the government aims for investment to increase at a rate of 5.4 percent to 5.6 percent this year.
National Development Planning Board (Bappenas) head Bambang Brodjonegoro said that while growth of household consumption could be maintained at around 5 percent, the rate would not rise further. The same went for exports, which are expected to increase by no more than 1.7 percent.
"If we can maintain the growth of household consumption at 5 percent, our economic growth would not fall below 5 percent. However, to grow faster than that, investment must be boosted," Bambang said on Thursday during the presentation of the 2017 economic outlook by the European Business Chambers of Commerce in Indonesia (EuroCham) at the Investment Coordinating Board’s (BKPM) headquarters in Jakarta.
(Read also: Indonesia seeks ‘back up' of US investment: BKPM)
According to Bappenas data, investment grew at a rate of 4.7 percent last year, while household consumption increased by 5 percent and exports fell by 1 percent.
BKPM head Thomas Lembong, meanwhile, said Indonesia could achieve its investment growth target this year, as developed countries, including the United States and those in the eurozone, had shown robust economic growth last year.
He also expressed optimism that capital outflows from Indonesia’s stock market in anticipation of new economic policies by US President Donald Trump would soon be compensated for in the form of foreign direct investment coming to Indonesia.
"We had dollar appreciation recently, after Donald Trump was elected. With stronger dollar, Americans will consume more, import more and trigger foreign direct investment from the US," he said. (hwa)
