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Government Increases Investment Flow Improvement

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By: Savira Ayu)*

The government continues to improve the flow of investment in Indonesia. With improvements in all sectors, investors will be interested in developing their business in Indonesia.

Investment can be a driving force for the Indonesian economy, the existence of investment is considered to be able to strengthen the circulation of money in Indonesia because this will have an impact on the absorption of labor. So it is important for the government and its staff to actually formulate regulations to improve investment flows in Indonesia.

The Minister of Investment/Head of BKPM Bahlil Lahadalia said the work pattern of the Ministers of the Advanced Indonesian Cabinet. According to him, all ministers under the leadership of President Joko Widodo must work extra aka gaspol so as not to be left behind.

Bahlil revealed Jokowi’s directives related to investment in the country. First, investment must be inclusive, not only concentrated in Java but spread across all provinces in Indonesia. This means that investment should not only be concentrated on the island of Java. We have to build Indonesia-centric. Because our nation is from Sabang – Merauke.

Second, investment coming into Indonesia must also be of high quality. Third, investment can encourage the creation of new growth centers, so that economic growth can also occur in areas of Indonesia other than Java. Investment must be fertile evenly.

The Minister of Investment also focuses not only on large investors but also on micro, small and medium enterprises (MSMEs). In addition, the government also encourages partnerships between large entrepreneurs and local entrepreneurs and MSMEs. MSMEs contribute 60 percent to GDP and 99.6 percent of the total business units.

Bahlil said, how to break through all the problems that have been a problem, including slow licensing, including collaboration between large entrepreneurs and MSMEs. He added that investment is one of the key factors in encouraging national economic growth.

Investment is upstream, creating jobs, increasing state income, creating added value, increasing our competitiveness and all kinds of things. This investment has contributed to our national economic growth of 31 percent.

The Ministry of Investment noted that investment realization in the first quarter of 2022 reached IDR 282.4 trillion, growing 28.5 percent from the same period in the previous year of IDR 219.7 trillion. Realization of investment in this period also recorded a growth of 16.9 percent compared to the previous quarter of Rp 241.6 trillion so that it managed to record the highest growth in the last 10 years.

The realization of investment in the first quarter of 2022 of IDR 282.4 trillion has reached 23.5 percent of the target requested by President Jokowi of IDR 1,200 trillion this year. Previously, in 2021 the realization of investment from January to September 2021 had reached 73.3 percent or Rp. 659.4 trillion of the target of Rp. 900 trillion, and this again shows an interesting development where PMA and PMDN remain balanced.

Realization between Java and Outside Java still shows positive things, where outside Java is 51.7 percent and Java is 48.3 percent. This means that this is something that is very good so that the realization of this investment is balanced, not only in Java.

As of December 2021, the IDX (Indonesian Stock Exchange) recorded that there were 766 listed companies and 123 bond listed companies with a market capitalization of Rp. 8,255.6 trillion. Meanwhile, at the close of 2021, the JCI reached 6,581.5 with an average daily share trading of IDR 13.4 trillion. This figure is higher than before the Covid-19 pandemic, so it can be said that the Indonesian economy has shown a recovery.

Meanwhile, the Coordinating Minister for Maritime Affairs and Investment (Menko Marves) Luhut Binsar Pandjaitan emphasized that the government has prepared various regulations to support Indonesia’s economic transformation, especially in the investment sector.

One of them is by issuing a job creation law and its derivative regulations. According to Luhut, the Job Creation Law will make the investment process less complicated or convoluted.

The ministry under President Jokowi has a difficult task, namely to keep the flow of investment able to improve the economy in Indonesia, and to formulate regulations that can increase the interest of potential investors to invest in Indonesia. The various hard works of the Government are a manifestation of the Government’s commitment to facilitate business, for the sake of optimizing the absorption of labor which leads to the welfare of the people.

)* The author is a contributor to Pertiwi Institute

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