Percentage of Investment in Indonesia – Indonesia is said to have many opportunities to gain enormous opportunities in ASEAN. Indonesia is a country with the largest economy in ASEAN and the existence of MEA can further encourage growth.
Indonesia is endowed with a supportive demography and a large domestic market but ASEAN will be able to provide greater market opportunities. Indonesia can also benefit from the large intra-ASEAN trade. From intra-ASEAN trade Indonesia can get the opportunity to diversify risks and increase endurance amid global shocks. Thus, the percentage of investment in Indonesia is quite large.
domestic investment “PMDN” is targeted at 208.4 trillion rupiahs, equivalent to thirty-five percent of the total investment target of 594.8 trillion rupiahs. Meanwhile, the Foreign Capital investment is projected to dominate the 2016 investment target set by the Investment Coordinating Board (BKPM), with a percentage of sixty-five percent worth 386 trillion rupiahs. The portion of FDI target slightly decreased from the realization of investment in the period of January to September 2015 which reached 66.7 percent with an investment value of 266.8 trillion rupiahs.
The fact that there is now either the interest of investors or the readiness of domestic industry is conducive to achieve the target composition of PMA and PMDN. “Foreign investors are quite enthusiastic to invest in Indonesia, especially from Asia that dominates. Forty-eight percent of 2010-third-quarter, 2015 investment comes from Asia. Indonesia does have a fair percentage of investment in Indonesia.
Grouping Types of Investments
- Time deposits, representing deposits denominated in Rupiah, are available in a period of 1.3, 6, 12 and 24 months, with interest rates relatively higher than other types of deposits.
- Bank Indonesia Certificates, are part of BI’s efforts to reduce and stabilize liquidity in the market.
- Shares, certificates of ownership of capital shares of limited liability companies which grant various rights under the provisions of the articles of association.
- bonds, debt securities that have a maturity of more than one year and certain ethnic interest, issued by the company to withdraw funds from the public, in order to finance the company or by the government for its budget.
- Money market securities, are short-term securities traded on the money market.
- Certificates of bonds payable, is proof of ownership of receivables to other parties. This bonds bond certificate is a form of long-term investment. This certificate may be traded at a specified discount rate.
- Land or building, this investment belongs to investment in the form of property, usually this investment for a long time because it is expected an increase of the value of land or buildings that have been purchased.
- Mutual fund, is an investment container containing funds from several investors where the money inside is invested into various investment products by an Investment Management Company.
Based on the report of the Investment Coordinating Board, investment realization of Domestic Investment and Foreign Investment in the first quarter of 2017 reached 165.8 trillion rupiahs. That figure grew 13.2 percent compared to 146.5 trillion rupiahs in the same period last year. The realization of the investment absorbs 194,000 workers.
The target realization of investment for 2017 is 678.8 trillion rupiahs. The data on the realization of FDI and PMDN in the first quarter of 2017 explains that investment interest in Indonesia remains high and we are optimistic that the 2017 target of 678.8 trillion rupiahs will be achieved. From this data it can be concluded that the percentage of investment in Indonesia is quite good.
Economic Condition of Asian Region
East Asia, comprising East Asia and Southeast Asia is one of the world’s largest foreign investment destinations based on an annual report summarizing the data of foreign investment in each of the developing countries of the world by 2014. With a PMA of US $ 381 billion and a growth rate of 9.6 percent, the Eastern Asian region has a portion of 31 percent of all FDIs worldwide
Meanwhile, Indonesia experienced an increase in foreign investment by 20 percent to US $ 22.6 billion from US $ 18.8 billion compared to the previous year. The growth of foreign investment in Indonesia is the second highest in East Asia, while in terms of value of FDI is the fourth largest. If focused on Southeast Asia alone, the growth of PMA Indonesia by 20 percent is the highest among other countries. FDI growth in Singapore alone reached 4.2 percent despite the amount of FDI of US $ 67.5 billion, or three times greater than Indonesia.
Realization of investment by business sector is mining, i.e. 23.6 trillion or 14.2 percent), food industry, 18.5 trillion rupiahs or 11.1 percent, transportation, warehouse and telecommunication 18.4 trillion rupiahs or 11, 1 percent, electricity, gas and water are 16.7 trillion rupiahs or 10.1 percent, and basic metals, metals, machinery and electronics industries 15.2 trillion rupiahs or 9.2 percent. Thus, the percentage of investment in Indonesia is quite a lot.