Below is a list with tagged columns and company profiles.

Today's Headlines Foreign Investment

  • Indonesia Invites Investors to Develop Small Islands and Coastal Areas

    The government of Indonesia invites foreign and domestic investors to invest in the country's small islands and coastal areas in order to make these locations more attractive for tourism and other sectors. Facilities and infrastructure in these areas as well as transportation to and around these areas should be improved. Therefore, the government - through its Team for the Acceleration of Investment in Small Islands within the Ministry of Fishery and Maritime - is eager to make the investment climate more attractive. Currently, it sees three bottlenecks.

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  • Indonesia Popular as Investment Target for Hotel Construction

    Indonesia Popular as Investment Target for Hotel Construction

    Investors regard Indonesia as one of the most attractive countries in terms of tourism. This statement is evidenced by investments in Indonesia's hotel construction sector. In 2012, Indonesia was ranked third of the whole Asian region in terms of largest investments in hotel construction. Total investments - both domestic and foreign investments - in this sector of Southeast Asia's largest economy amounted to USD $869.8 million in 2012, a 210 percent increase compared to the previous year.

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  • Indonesia's Economic Growth Expected at 6.1% in Semester I-2013

    According to Finance minister Chatib Basri, the Indonesian government expects the country's gross domestic product (GDP) to have grown by 6.1 percent in the first six months of 2013. This forecast falls short of the government's 6.3 percent GDP growth assumption in the state budget (APBN). Basri stated that the lower outcome is due to global factors, such as slowing economic growth in China and India. But the government's assumption is more optimistic than the forecast of the central bank, which expects growth between 5.1 and 5.9 percent.

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  • Indonesia's Manufacturing Industry Most Popular Foreign Investment

    Two sectors of the Indonesian economy stand out as most popular destinations of foreign investments in the first six months of 2013. These are Indonesia's manufacturing sector and the construction, property and real estate sector, which grew 46.7 percent and 100.6 percent respectively compared to the same period in 2012. Based on data of the Indonesia Investment Coordinating Board (BKPM), foreign direct investments in Indonesia increased 23 percent to USD $14.1 billion in the first semester of 2013.

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  • New Tax Incentives to Create a Better Investment Climate in Indonesia

    Head of the Finance Ministry's fiscal agency Bambang Brodjonegoro said that the Indonesian government is preparing tax incentives to spur foreign investments. The new regulation will extend the previous expired one and also provides new incentives that make investing in Indonesia more attractive. One possible change concerns the minimum value of investments. Currently, investments between IDR 1 trillion - 20 trillion receive the same benefits. However, this may be revised in such a way that the bigger the investment, the better the incentives.

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  • Indonesia's Mining Sector Attracts most Investments despite Weak Export

    Indonesia's mining sector is still the biggest beneficiary of both domestic and foreign direct investments. Investments in Indonesia's mining sector rose 23.8 percent in the first six months of 2013 compared to the same period in 2012. This may be somewhat surprising as global economic turmoil in recent years has resulted in falling commodity prices and weak mining exports. Investments are the most important pillar of economic growth in Indonesia after the country's vibrant consumer industry.

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  • Investments in Indonesia are Expected to Rise 25% in Q2-2013

    The Indonesia Investment Coordinating Board (BKPM) expects that investments in the second quarter of 2013 will grow by 25 percent to IDR 96.13 trillion (USD $9.6 billion) compared to Q2-2012. Although Indonesia's economic growth is under threat of slowing down to below an annual growth rate of six percent, the government agency still believes that total investments in 2013 can meet the target of IDR 390 trillion (USD $39 billion). Investments in Q1-2013 were recorded at IDR 93 trillion.

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  • Capital Outflows from Indonesia as Fed's Quantitative Easing May End

    Emerging markets, such as Indonesia, have been feeling the impact of a recovering economy in the United States. Last month, the Federal Reserve announced that, if the economy of the USA continues its improving trend, it will end its quantitative easing program gradually in 2013 until a complete stop in 2014. As Indonesia is one of the emerging economies that benefited from the spillover effects of the Fed's monthly bond-buying program, the country now feels the negative impact of the possible stop to the program.

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  • Fraser Institute Survey: Indonesia's Mining Sector Needs Legal Certainty

    In a new survey, conducted by the Fraser Institute, that assesses the state of the investment climate in the mining sector in 2012-2013 in countries around the globe, Indonesia is ranked at number 96. Both tax and regulatory uncertainties in Indonesia's mining sector are cited as reasons for the low ranking of the country. As investments in the mining sector are capital intensive and long-term in nature, investors thus need a clear legal framework that is not susceptible to sudden changes due to political issues.

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  • Indonesian Government Projects 6.4% to 6.9% Economic Growth in 2014

    In the draft for the State Budget of 2014 (RAPBN 2014), the government of Indonesia projects economic growth of between 6.4 and 6.9 percent. Continued global recovery is expected to result in higher GDP growth compared to 2012 (6.23 percent) as it will result in better demand for Indonesian products, such as commodities. The main pillar of Indonesia's GDP growth - domestic consumption - is expected to grow due to the population's higher purchasing power and the upcoming legislative and presidential elections.

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Latest Columns Foreign Investment

  • New Foreign Investment Regulation Issued By BKPM

    New Foreign Investment Regulation Issued By BKPM

    Recently, the Indonesian Investment Authority (BKPM) issued Regulation no. 13 of 2017 regarding Guidelines and Procedures for Investment Licensing and Facilities (13/2017 Regulation). The 13/2017 Regulation is of great importance for foreign investors that currently have or wish to establish a foreign investment company in Indonesia. The regulation regulates the investment requirements for Foreign Limited Liability Companies (PT PMA) and several types of Foreign Representative Offices. In this column we discuss the licensing system for foreign capital investment.

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  • Divestment Procedure for Mining Companies Revised

    Divestment Procedure for Mining Companies Revised

    Recently, the Ministry of Energy and Mineral Resources (Ministry) issued regulation number 9/2017 on Procedures for Divestments and Mechanisms to Determine the Divested Share Price for Business Active in the Minerals and Coal Sector (New Regulation). The New Regulation replaces Ministry regulation number 27/2013. In this column we discuss the impact of the New Regulation on foreign investors in Indonesia.

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  • Construction Business License Foreign Investment Limited Liability Companies

    Construction Business License for Foreign Investment Limited Liability Companies (PT PMA)

    Recently the Minister of Public Works (Minister) issued a new regulation no. 03/PRT/M/2016 regarding the Technical Guidelines for Granting a Foreign Investment Construction Business License (New Construction Regulation). The New Construction Regulation sets implementing guidelines on how to obtain a construction business license for foreign investment limited liability companies (PT PMA), including the documents required to be submitted and the obligations of the construction PT PMA.

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  • Fewer Restrictions on Trading Companies under New Negative Investment List

    Fewer Restrictions on Trading Companies under New Negative Investment List

    Distributors and other trading companies were highly protected against foreign investors under the old negative investment list based on Presidential Regulation No. 39/2014 (Old Regulation). The new negative investment list, based on Presidential Regulation No. 44/2016 on the List of Business Fields Which Are Closed and Conditionally Open to Investment (New Negative Investment List), now sets less stringent restrictions for foreign investors for these fields of business. In this column we discuss the changes for trading companies based on the New Negative Investment List.

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  • Foreigners Need Rep Office or JV for Construction Work in Indonesia?

    Foreigners Need Rep Office or JV for Construction Work in Indonesia?

    Indonesia's economic growth in the first quarter of 2016 was rather disappointing at 4.92 percent (y/y), below analyst estimates that averaged around 5 percent (y/y), due to slowing household consumption, private investors being in a wait-and-see mode, and relatively weak government spending (a usual phenomenon at the year-start). Indonesia's construction sector also grew weakish in Q1-2016. However, the construction sector still has good prospects in the years ahead on the back of the government's infrastructure projects.

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  • New Negative Investment List 2016 - Preview of Changes

    New Negative Investment List 2016 - Preview of Changes

    The new negative investment list 2016 is not yet issued by Indonesian President Joko Widodo. However along with the launch of the tenth economic policy package, the government is currently processing the new draft of this list. Although not yet issued, in this column we discuss the most likely changes to be implemented in the new negative investment list 2016. The current draft regulation removes 35 business fields form the negative investment list. Besides that, more business fields are reserved for small and medium sized companies (local companies).

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  • Company Establishment Requirements at BKPM Reregulated

    Company Establishment Requirements at BKPM Reregulated

    Company establishment in Indonesia by foreigners can be done through a specific limited liability company for foreign investors. Such company is known as a PT PMA. A PT PMA is subject to more stringent company establishment requirements as compared to local limited liability companies (known as PT). In the column of this week we discuss the requirement to invest more than 10 billion Indonesian rupiah (currently equivalent to approx. USD $750,000), the implementation thereof by foreign investors, and the consequences for not reaching the required investment amount.

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  • Horticulture Sector Indonesia: Flexible toward Foreign Ownership Cap

    Horticulture Sector Indonesia: Flexible toward Foreign Ownership Cap

    The Indonesian government's decision to limit foreign ownership in the horticulture sector to a maximum of 30 percent (through Law No. 13/2010 on Horticulture), from 95 percent previously, continues to cause a polemic as such protectionism may be a big disadvantage to the development of Indonesia's horticulture sector. Moreover, the law works retroactively implying that existing companies owned by foreign investors need to divest their majority ownership interests. In Law No. 13/2010 foreigners were given four years to divest their shares.

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  • New Investment Regulation Foreign Investors Indonesia (2/2)

    New Investment Regulation Foreign Investors Indonesia (2/2)

    In our previous column we discussed the changes put through by the Indonesia Investment Board (known as “BKPM”) with regard to the principle license. The principle license is the primary license required for foreign investors to start a company in Indonesia. In this week’s column we discuss BKPM regulation number 15 of 2015 on the Guidelines and Procedures for Obtaining Investment Licenses and Non-Licenses (“New Investment Regulation”). Together with the previously discussed BKPM regulation the New Investment Regulation aims to simplify investment procedures in Indonesia (both foreign and domestic).

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  • Shares and Capital in a Limited Liability Company in Indonesia

    Shares and Capital in a Limited Liability Company in Indonesia

    The general provisions regarding shares in an Indonesian limited liability company (PT for local companies and PT PMA for foreign companies in Indonesia) are regulated in Indonesian Law number 40 of 2007 concerning Limited Liability Companies (Company Law). The Company Law regulates the minimum authorized capital and paid-up capital, and stipulates procedural rules related to the purchase, ownership and sales of shares.  In this column we discuss the general rules governing shares of a limited liability company in Indonesia.

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