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FDI rebounds in Q1 despite investment slowdown
The rebound came at a time when the government had begun implementing the Jobs Creation Law by issuing derivative regulations.
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Investment Coordinating Board (BKPM) head Bahlil Lahadalia speaks in a virtual press briefing on Jan. 25 in this screengrab from the BKPM's YouTube account. (Courtesy of Investment Coordinating Board (BKPM)/-)
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ndonesia saw a rebound in foreign direct investments (FDI) in the first quarter of this year, even though overall investment growth had slowed following a contraction in domestic direct investment (DDI) during the same period.
The Investment Coordinating Board (BKPM) reported on Monday that foreign investments had grown 14 percent year-on-year (yoy) to Rp 111.7 trillion (US$7.7 billion), while domestic investments contracted 4.2 percent yoy to Rp 108 trillion.
“Regardless of the pandemic, our FDI has started stabilizing,” BKPM head Bahlil Lahadalia said in a virtual presser on Monday. “This shows the world’s confidence in Indonesia. Our FDI activity has started to normalize and adapt to the COVID-19 pandemic, which has battered the world and our country.”
As a result, Indonesia’s overall investment realization reached Rp 219.7 trillion, marking a 4.3 percent annual growth. The figure is still lower than the 8 percent annual growth seen in the same period last year.
The rebound came at a time when the government had begun operationalizing the Jobs Creation Law by issuing derivative regulations. The law overhauls at least 79 other laws in improving the country’s ease of doing business to lure more investors.
The law also mandates the creation of a new online single submission (OSS) system that centralizes licensing processes for businesses and is expected to start operating by the middle of the year.
Read also: Job Creation Law could boost investment, but risks loom
