Based on data from the Indonesia Investment Coordinating Board (BKPM), total direct investment realization in full-year 2018 reached IDR 721.3 trillion, up 4.1 percent compared to the preceding year. However, it means that the government’s investment target of IDR 765 trillion was not achieved.
Total domestic direct investment (DDI) realization in 2018 reached IDR 328.6 trillion, showing a solid increase of 25.3 percent on an annual basis. Meanwhile, total foreign direct investment (FDI) realization in 2018 was recorded at IDR 392.7 trillion, down 8.8 percent (y/y).
What is remarkable is that the gap between DDI and FDI realization has been narrowing rapidly in recent years. A few years ago, FDI was usually double the amount of DDI. We attribute this trend to the combination of falling FDI ahead of the 2019 elections as well as an increase in DDI on the back of Indonesia’s tax amnesty program (in 2016-2017) which resulted in a large portion of funds being repatriated into Indonesia. Some should have found its way into direct investment.
This articles discusses:
• foreign and domestic direct investment in Indonesia in 2018
• what causes FDI to stall?
• which incentives have been prepared by the government to boost investment?
• who were the biggest investors in 2018? And which sectors enjoyed most investment?
Read the full article in the January 2019 edition of our monthly research report. This report is scheduled to be released in early February 2019. You can purchase the report by sending an email to firstname.lastname@example.org or a WhatsApp message to the following number: +62(0)8788.410.6944