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Govt bans new investment in alcoholic beverage industry
With a recently issued regulation, the government seeks to close the alcoholic beverage industry for new investment, bowing to pressure from Muslim organizations and Papuan political leaders.
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Chilling news: The government has closed the alcoholic beverage industry to new investment. (Shutterstock/Room 76)
T
he government has issued a presidential regulation to close the alcoholic beverage industry for new investment following pressure from Muslim organizations and Papuan political figures.
President Joko “Jokowi” Widodo abruptly revoked in March Presidential Regulation No. 10/2021, which allowed investment in the alcoholic beverage industry in Bali, East Nusa Tenggara (NTT), North Sulawesi and Papua, and possibly in other provinces depending on proposals from governors.
Presidential Regulation No. 49/2021, which was issued on May 25, revises the previous regulation on investment and adds the alcoholic beverages industry to the list of closed industries under Article 2.
“Industries closed for investment as stated in Paragraph 1 (a) are: liquor industry (KBLI 11010), alcoholic beverage industry: wine (KBLI 11020) and malted beverage industry (KBLI 11031),” the regulation reads, referring to each industry by its Indonesian Standard of Industrial Classification (KBLI) designation.
The government issued the investment regulation as a derivative to the Job Creation Law, an omnibus law that revises 79 laws with the aim to improve the ease of doing business to the country and thereby increase investment.
Read also: Conservative forces thwart alcohol investment plan
Investment Minister Bahlil Lahadalia said in March that the government, through the regulation, sought to promote the development of local alcoholic beverages, such as sopi in NTT and arak in Bali. As of March, the government has issued 109 permits for alcoholic beverage businesses in 13 provinces, according to the minister.
