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Foreign Investors Must Collaborate with Regional Entrepreneurs

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By: Reza Herlambang )*

Foreign investment in Indonesia continues to be intensified and the government facilitates regulations, to attract foreign investors. However, there is one regulation that they must obey, which is the obligation to collaborate with regional entrepreneurs. In this way, the world of business and investment will be more advanced, in all regions in Indonesia.

President Jokowi’s administration is synonymous with economic acceleration and investment in Indonesia. Investment is one way out to survive the recession and the negative effects of the COVID-19 pandemic, because it will increase the country’s foreign exchange. To facilitate the entry of foreign investors, the government inaugurated the Omnibus Law on Job Creation with investment clusters.

The Indonesian people are very happy because the Omnibus Law on Job Creation makes it easier for investors to enter Indonesia. However, the government of course proclaimed other conditions, not just simplifying their business licensing. Among other things, foreign investors must transfer knowledge and they are obliged to collaborate with regional entrepreneurs.

Investment Minister Bahlil Lahadalia stated that foreign investors who want to do business in Indonesia must collaborate with regional investors/entrepreneurs. This is stated in the Job Creation Act. In a sense, this requirement is very important because it will benefit regional entrepreneurs.

So far, it seems that the economic and investment sectors are centered on big cities such as DKI Jakarta and Surabaya. However, the government wants economic equality and investment throughout Indonesia. One of them is the regulation that foreign investors must collaborate with regional entrepreneurs.

With this regulation, the business and investment world will be evenly distributed, not only dynamically in Jakarta and its surroundings, but also in other regions in Indonesia. Investment is not only confined to the capital, but also to remote areas, from Sabang to Merauke. 

The positive impact of equal distribution of investment in various regions is the reduction in the unemployment rate in Indonesia. The reason is because foreign investors build factories and other businesses (the result of collaboration with local entrepreneurs), so they need new employees. Unemployment will automatically decrease.

In addition, local entrepreneurs are also happy because their business is progressing, thanks to the injection of funds from foreign investors. They can rise from the impact of the pandemic and do business seriously, because there is cooperation with foreign investors.

Local entrepreneurs also have the opportunity to study, either in business or other fields, because the Omnibus Law on Job Creation states that foreign investors are obliged to transfer technology and knowledge. Local entrepreneurs will increase their knowledge, not only looking for profit in trading, but also know how to do business strategies under experienced mentors. 

Meanwhile, the obligation of foreign investors to collaborate with regional entrepreneurs is aimed at leveling the Indonesian economy. This was stated by President Jokowi who wants entrepreneurs to be more resilient and advance the Indonesian economy. The trick  is upskilling  and  reskilling , in order to win a tight competition.

In a sense, the government wants economic equality throughout Indonesia. Do not let the progress that occurs (thanks to the large number of investors) only in DKI Jakarta, Surabaya, Jogjakarta, Makassar, or other big cities. However, investment must be evenly distributed, even to remote areas of Aceh or Papua. Communities should enjoy the various advances that occur in the presence of investment.

With so many investors in the regions, the Indonesian economy will automatically be more advanced, because more and more industries are being built. However, the public does not have to worry because it is guaranteed to be environmentally friendly, because the government is intensifying green investment in Indonesia. For business management, it is also based on the impact of risk, and efforts are made not to pollute the environment.

Regional entrepreneurs are also obliged to increase their skills so that they are trusted by many foreign investors. Not only proficient in English or Mandarin as a  basic skill  so that it is easy to communicate with foreign investors. But also  soft skills  such as willingness to work hard, always on time, willing to keep learning, etc. If you get funds from investors, your business will automatically be much better.

Then, foreign entrepreneurs also do not hesitate to go to various regions in Indonesia, because they believe that there are many potential natural resources that can be processed. In addition, there is adequate infrastructure support, so that business will run smoothly, because the government has built various infrastructures to remote areas. In this way, they will be more confident to enter Indonesia.

When there is a regulation that foreign investors are obliged to collaborate with local entrepreneurs, the community appreciates it. This means that in the future there will be more business investment returns in the region. Progress will be felt not only in DKI Jakarta and its surroundings, but also in other areas.

)* The author is a contributor to the Nusantara Reading Room 

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