Tag: invest in Indonesia

Elected President Prabowo Subianto – Gibran Rakabuming Raka spoke about his belief in achieving an economic growth target of 8 percent per year.

Senior Economist Indef Dradjad Wibowo, reported by the media, said that in history, Indonesia had indeed experienced economic growth five times by 8 percent or more. The high economic growth occurred in 1968 (10.92 percent), 1973 (8.10 percent), 1977 (8.76%), 1980 (9.88%), and in 1995 (8.22 percent) . From its analysis of the trend of Indonesia’s economic growth from 1961-2023, the average economic growth of our economic is 5.11 percent per year, although in general Indonesia always has an opportunity for economic growth which reaches 8 percent.

Why did this happen? The current industrialization does result in investment and good capital accumulation. This investment disbursement has encouraged the increase in fiscal space that can be used as government spending, raising the volume of our export commodities, and ultimately increasing the ability of public consumption.

But on the other hand, opportunities for large economic growth and cannot be maximized are also formed by several problems. Indonesia still has a long, complicated bureaucratic chain, and also tends to be corrupt. The quality of the workforce produced by the world of education is often not absorbed because of skills that are not suitable for industrial needs. State intervention through economic policy, often too complicated in implementation, causes microeconomic actors who prefer the informal sector as a source of their livelihood. Practically in this perspective, we are waiting for at the same time warning the Prabowo-Gibran government with the Asta Cita that they are carrying, can cut the structural obstacles that exist.

Economic growth of 8 percent every year is indeed important because with this achievement Indonesia can be separated from the middle income trap (MIDDLE INCOME TRAP/MIT) and towards developed countries. Among the G20 countries, Indonesia is included in the early rows of countries with economic growth trends above 5 percent, under China and India.

What can be achieved to achieve 8%economic growth?

Real social justice. Prabowo-Gibran economic instruments in the upcoming policy package must remain prudent (careful) and focus on the inclusive economic path that empowering all sectors. This is important because the risk of miscalculation in translating high economic growth targets will cause social division that threatens the integration of our nation.

Inclined Economic Urgency. Chasing economic growth with a fair and equitable inclusive economy must be followed by the persuasive ability of the upcoming government to invite all components of the nation to be involved more in this project. Form a concise, clean, and agile bureaucracy. Third, the creation of economic added value through downstreaming and manufacturing investment must also produce new jobs. Creating a strong entrepreneurship climate, with adequate policy support to reduce unemployment.

October 18, 2024, CNBC Indonesia

(https://www.cnbcindonesia.com/opini/20241018113127-14-580767/target-pertumbuhan-ekonomi-8-prabowo-gibran-ilusi-atau-realistis)

PT Aneka Tambang Tbk together with companies from China and South Korea will build an electric vehicle (EV) battery factory. The investment value is around IDR 80 trillion. Minister of Investment/Head of Investment Coordinating Board (BKPM) Rosan Roeslani said talks with Korean and Chinese companies were underway.

“We encourage the (factory) EV battery. We have talks with two even at this time at this time we are final stage but maybe I don’t say it first, but this is a Korean and Chinese company,” said Rosan, at the Ministry of Investment/BKPM office , South Jakarta, Tuesday (10/15/2024).

Rosan said, within 1-2 months the government will complete the agreement with the two companies. Thus, policy implementation can be implemented immediately.

“The investment is almost IDR 80 trillion, more or less yes US $ 5.5 billion. So that is also a very significant investment and there are actually two. That is cooperation with our BUMN, cooperation with PT Aneka Tambang so that God willing can be completed, “He said.

In addition to information, previously the Deputy for Investment and Mining Coordinating Ministry for Coordinating Ministry of Maritime Affairs and Investment Septian Hario Seto revealed the potential for large investment can enter Indonesia for the construction of nickel -based electric vehicle battery ecosystems. The investment value is estimated at US $ 20 billion- US $ 25 billion or equivalent to IDR 312 trillion – IDR 390 trillion (exchange rate of IDR 15,600).

Seto said, the value of the investment is a potential that Indonesia can get in the next 5 years. This investment is instilled from a consortium of companies involving many countries such as China to Europe.

“But for nickel for the battery, this room is still there. We see that there may still be around, our estimates are around US $ 20-25 billion more investments that can enter this battery sector in the next 5 years,” explained Seto in the forum Discussion at Le Meridien Hotel, Jakarta, Wednesday (9/10/2024).

October 15, 2024, detikFinance(https://finance.detik.com/industri/d-7589639/ri-gandeng-china-korea-mau-bangun-pabrik-baterai-mobil-listrik-rp-80-t)

The Central Statistics Agency (BPS) noted that Indonesia’s trade balance in September was again in surplus by US$ 3.26 billion. This achievement is a surplus for 53 consecutive months since May 2020.

Previously, the national trade balance in August was in surplus on a monthly basis of US$ 2.40 billion. BPS reported that the export value in September was recorded at US$ 22.08 billion, down 5.80%, while for imports, BPS noted that in September 2024, the total import value reached US$ 18.82 billion or down 8.91% from August 2024.

“In September 2024, the goods trade balance was recorded in surplus of US$ 3.26 billion or up US$ 0.48 billion on a monthly basis, thus Indonesia’s trade balance has recorded a surplus for 53 consecutive months since May 2020,” said Acting Head of BPS Amalia A. Widyasari at her office, Tuesday (15/10/2024).

“The monthly decline in import value was driven by a decline in the value of non-oil and gas imports and also a decline in the value of oil and gas imports,” said Amalia.

Amalia added that the trade balance surplus in September 2024 was higher compared to the previous month but lower compared to the same month last year.

“The surplus condition in September 2024 was supported by a surplus in non-oil and gas commodities of US$ 4.62 billion and the commodities that contributed the first surplus were mineral fuels hs27 animal and vegetable fats and oils HS 15 and iron and steel or hs72,” concluded Amalia.

October 15, 2024, detikFinance

(https://finance.detik.com/berita-ekonomi-bisnis/d-7588617/neraca-perdagangan-ri-surplus-53-bulan-beruntun)

(https://finance.detik.com/berita-ekonomi-bisnis/d-7588753/impor-ri-september-turun-8-91-jadi-us-18-82-miliar)

Indonesia has the 5^th largest airport operator in the world after the birth of PT Angkasa Pura Indonesia or InJourney Airports. InJourney Airports is a merger of PT Angkasa Pura I or AP I and PT Angkasa Pura II or AP II. President Director of PT Angkasa Pura Indonesia Faik Fahmi said that this step was a major breakthrough in the aviation and airport industry sector in Indonesia and would be a solution to solve problems in the aviation industry in Indonesia.

“Through this merger, InJourney Airports now manages 37 airports spread across the western, central, and eastern regions of Indonesia, and makes InJourney Airports the 5th largest airport management company in the world with more than 170 million passengers per year,” he told CNBC Indonesia, quoted Thursday (10/9/2024).

The formation of InJourney Airports, which is also a form of transformation in the airport management sector, aims to optimize the national airport system, increase the potential of the economic and tourism sectors, and logistics in Indonesia. He explained that in preparing for the integration of this airport operator, his party had completed the alignment and harmonization of regulations and standard operating procedures (SOP) through the omnibus regulation strategy, IT system governance, finance, and airport operations, thus creating an efficient and synergistic aviation ecosystem.

This optimism is supported by 3 pillars and 1 enabler, namely Premises (prime quality airport infrastructure and facilities), Process (close collaboration between InJourney Airports and the aviation ecosystem), People (HR in the service sector that is of high quality and meets global standards), and supported by the implementation of various technological innovations and digitalization as Enablers.

This merger is based on the basis that Indonesia has the main potential to become an aviation and tourism market. There are a number of factors that have the potential to make Indonesia a major market for aviation and tourism, including Indonesia’s condition as the largest archipelagic country in the world with the largest population in Southeast Asia and a growing consumer class, strategic geographical position, diverse natural and cultural beauty, and abundant natural resources. These factors affect the number of tourism contributions, domestic and international passengers, foreign tourists, and air freight cargo that exist and are managed in Indonesia. This step is also in line with the government’s vision to improve domestic connectivity and accessibility, which is expected to support overall economic growth and increase the competitiveness of the tourism sector in Indonesia.

“There are a number of factors that have the potential to make Indonesia a major market for aviation and tourism, including Indonesia’s condition as the largest archipelagic country in the world with the largest population in Southeast Asia and a growing consumer class, strategic geographical position, diverse natural and cultural beauty, and abundant natural resources,” wrote management. These factors affect the number of tourism contributions, domestic and international passengers, foreign tourists, and air freight cargo that exist and are managed in Indonesia.

This airport integration will also make PT Angkasa Pura Indonesia, previously known as PT Angkasa Pura II, the recipient company of the merger as the 5th largest airport manager in the world with 36 airports throughout Indonesia which are estimated to serve 550 million-700 million passengers by 2045. The management said that airport integration also has the potential to increase domestic and international air connectivity supported by an integrated planning system including coordination in opening new flight routes.

October 14, 2024, CNBC Indonesia

(https://www.cnbcindonesia.com/market/20241014190834-17-579588/indonesia-punya-operator-bandara-terbesar-nomor-lima-di-dunia)

Coordinating Minister for Maritime Affairs and Investment (Menko Marves) Luhut Binsar Pandjaitan inaugurated the start of the first phase of production and expansion plans for the production facility for cathode materials for electric vehicles (EV) batteries based on Lithium Iron Phosphate (LFP) by PT LBM Energi Baru Indonesia, in the Kendal Industrial Area, Central Java. This is the result of a strategic investment partnership between the Indonesia Investment Authority (INA) Consortium and Changzhou Liyuan New Energy Technology Co., Ltd., one of the world’s largest LFP producers. The investment is expected to play an important role in meeting global demand for LFP batteries, which is driven by the increasing penetration of electric vehicles (EVs) worldwide.

“We must create added value in our own country, build a strong downstream industry, and position ourselves as a key player in the global supply chain,” said Luhut, quoted from the official statement of the Coordinating Ministry for Marves, Tuesday (8/10/2024).

The planned joint investment is US$200 million to increase production capacity from 30,000 tonnes in phase I to 90,000 tonnes in phase II, which is expected to start in 2025. LFP is one of two key chemistries in lithium-ion batteries, alongside Nickel Cobalt Manganese (NCM). Known for its cost-effectiveness, LFP is well-suited for electric vehicles and energy storage systems.

Bain’s EV Battery Ecosystem study1 shows that global battery demand is expected to grow about four-fold between 2023 and 2030, driven by increasing EV adoption, positioning LFP to play a key role in meeting that demand. By 2030, NCM is projected to account for about 50% of lithium-ion battery demand, while LFP is expected to account for about 35%, with both expected to remain central to future battery industry growth.

The strategic partnership focuses on LFP cathode materials that represent the highest added value in the battery value chain, allowing the facility to capitalize on the opportunities presented by this growing market. By 2030, Indonesia is expected to serve a market worth around US$10 billion in LFP cathode active materials, making a significant contribution to the global transition to clean energy. This investment is also a testament to Indonesia’s attractiveness as a country for supply chain downstreaming.

Meanwhile, Changzhou Liyuan CEO Shi Junfeng stated that PT LBM Energi Baru Indonesia is the first cathode producer outside of China, whose initial operation is of great significance to enhancing the security of supply of the global new energy supply chain.

In addition, this cooperation is also another important achievement of the comprehensive strategic cooperation between China and Indonesia. The proposed strategic investment in LBM New Energy (AP) Ptd. Ltd. also fully demonstrates INA’s forward-looking vision and long-term commitment to the global new energy industry.

“This project will enable Changzhou Liyuan and INA to achieve closer strategic cooperation. In the future, Changzhou Liyuan will make meaningful contributions to the development of Indonesia and the global new energy industry,” he said.

October 8, 2024, CNBC Indonesia

(https://www.cnbcindonesia.com/news/20241008133849-4-577871/ri-china-makin-akrab-garap-baterai-litium-bukti-terbaru-dari-kendal)

The Ministry of Public Works and Public Housing (PUPR) has completed a series of infrastructure developments during the 10-year term of President Joko Widodo. The infrastructure varies from irrigation to toll roads.

PUPR Minister Basuki Hadimuljono said that there are two main roles of infrastructure. First, infrastructure as a means of production and supporting economic growth, such as roads, toll roads, energy, and dams. The second role is to fulfill basic services, such as the provision of drinking water, roads and bridges, housing, sanitation, and irrigation.

“Basic infrastructure itself is an important capital to support economic infrastructure,” said Basuki, in a written statement, Thursday (3/10/2024).

1. Dams to Irrigation

In the field of water resources, the PUPR Ministry through the Directorate General of Water Resources has successfully completed the construction of 53 dams out of 61 dams built. The dams that have been completed include the Sepaku Semoi Dam, Ameroro Dam, Leuwikeris Dam, Way Sekampung Dam and Kuningan Dam. In line with that, in the 2014-2024 period, the PUPR Ministry built 1,228,440 ha of irrigation networks and rehabilitated 4,647,547 ha of irrigation networks. In addition, the PUPR Ministry also completed 1,371 reservoirs, 493 sediment and lava controllers, 2,154 km of flood controllers and coastal protection.

2. Toll Roads

In the field of connectivity, the PUPR Ministry together with the Toll Road Business Entity (BUJT) have completed 2,432 km of toll road construction. One of which was recently inaugurated by President Joko Widodo is the Stabat-Tanjung Pura Toll Road and the 72 km Tebing Tinggi-Serbelawan-Sinaksak Toll Road which is part of the Trans Sumatra Toll Road.

“The presence of toll roads connected to productive areas such as industrial areas, tourism, airports, and ports will be able to reduce logistics costs and increase the competitiveness of domestic products,” he said.

3. Roads and Bridges

Furthermore, the PUPR Ministry through the Directorate General of Highways has also completed 5,999 km of new road construction, 125,904 m of bridge construction, 583 suspension bridges and 27,673 m of flyover/underpass construction.

4. Drinking Water and Sanitation

In the field of settlements, the PUPR Ministry through the Directorate General of Human Settlements has completed the Drinking Water Supply System (SPAM) of 36,380 ltr/sec, so that access to clean drinking water reaches 93% of the total population. Then, handling of 94,321 ha of residential areas, handling of waste and sanitation of 13.7 million families, so that access to clean sanitation reaches 82% of the total population.

5. State Border Crossing Posts

In addition, the construction of Integrated State Border Crossing Posts has also been carried out in 15 areas, as well as the construction, rehabilitation or renovation of 5,939 educational, sports and market facilities. On Wednesday (2/10), President Jokowi inaugurated 7 PLBNs, namely the Napan PLBN in NTT at a cost of IDR 128 billion, the Serasan PLBN in Natuna Kepri at a cost of IDR 145 billion, the Jagoi Babang PLBN in West Kalimantan at IDR 226 billion, the Sei Nyamuk PLBN in North Kalimantan at IDR 248 billion, the Labang PLBN in North Kalimantan at IDR 210 billion, the Long Nawang PLBN in North Kalimantan at IDR 243 billion, and the Yetetkun PLBN in South Papua at IDR 146 billion.

6. Housing

Next, in the housing sector, the PUPR Ministry through the Directorate General of Housing has built 10.2 million housing units with APBN contributions through the One Million Houses Program. Then there are 1.49 million housing units through the Self-Help Housing/Self-Help Housing Stimulus Assistance (BSPS) program, 40,347 special housing units and 71,731 flats.

October 1, 2024, detikFinance

(https://finance.detik.com/infrastruktur/d-7570961/daftar-infrastruktur-yang-dibangun-dalam-10-tahun-pemerintahan-jokowi)

(https://finance.detik.com/infrastruktur/d-7567279/10-tahun-jokowi-jadi-presiden-521-infrastruktur-transportasi-sudah-terbangun)

Indonesia and Malaysia continue their agreement to abandon the United States (US) dollar and switch to the use of local currencies in trade and investment transactions. This agreement was marked by the renewal of the local currency bilateral swap agreement (LCBSA) by Bank Indonesia (BI) and Bank Negara Malaysia (BNM), Friday (27/9/2024). The meeting was held in Jakarta. Bank Indonesia was represented by Governor Perry Warjiyo and BNM was represented by Dato’ Seri Abdul Rasheed Ghaffour and his staff.

“Bank Indonesia views the increased cooperation in the local currency bilateral swap agreement (LCBSA) with BNM as representing an important role of international cooperation as part of Bank Indonesia’s policy mix that supports key policies in the fields of monetary, macroprudential, and payment systems, while at the same time contributing to the development of local currency-based transactions in both countries,” Perry said in a press release.

The renewal of the LCBSA allows for the exchange of local currencies between the two central banks up to RM24 billion or IDR82 trillion for the next five years. In the bilateral meeting, they also discussed policy directions covering macroeconomics, monetary and financial, payment systems and digitalization, and strategies to advance Islamic finance.

“As trade and financial interconnection between Malaysia and Indonesia increases, we welcome the agreement to continue cooperation with BI through the renewal of this LCBSA agreement. The LCBSA cooperation complements the ongoing local currency transaction (LCT) cooperation and is currently the main scheme in settling trade and investment transactions in each country’s currency,” explained BNM Governor Dato Seri’ Abdul Rasheed Ghaffour.

The renewal of the BI and BNM LBCSA cooperation is a shared aspiration of both parties after the LCBSA cooperation was first implemented in 2019 and extended in 2022 and is part of a continuous effort to strengthen the cooperation between the two central banks that has existed for a long time.

September 27, 2024, detikFinance

(https://finance.detik.com/berita-ekonomi-bisnis/d-7559165/pertamina-grand-prix-of-indonesia-jadi-ajang-kebanggaan-masyarakat-lombok)

The 2024 Pertamina Grand Prix of Indonesia organized by Pertamina together with the Indonesia Tourism Development Corporation (ITDC) and the Mandalika Grand Prix Association (MGPA) has succeeded in gaining an extraordinary place in the hearts of the people of Lombok, and the annual event is always awaited.

“The 2024 Pertamina Grand Prix of Indonesia event is one of the most awaited events by the people of Lombok, from all corners of Lombok Island they must watch this event, as evidenced by the special ticket sales for local people that have sold out,” said Harry, in a written statement, Wednesday (25/9/2024), in a written statement, Thursday (26/9/2024).

He hopes that in the future the Pertamina Grand Prix of Indonesia will continue to be held because according to him this event has become a source of pride for the people of Lombok.

“It can be said that the Pertamina Grand Prix of Indonesia has become an icon for the people of Lombok that must be held every year. This means that collaboration between parties must be maintained properly. Because if this event is lost, the pride of the people of Lombok will also be lost,” said Harry.

“This international event also has a multiplier effect for Lombok, and other tourist cities in Indonesia which are then visited by tourists watching the Grand Prix of Indonesia,” he continued.

Around dozens of tourists from various countries gathered at the Circuit Sport Bar, Grill & Resto. The restaurant, which is located close to the Pertamina Mandalika International Circuit, was crowded with foreign tourists who chatted and watched the MotoGP qualifying session together while enjoying snacks and fresh drinks.

“The restaurant’s income has increased quite a bit by 80 percent. For us in the MSME sector, an international event like this is very much needed, so Pertamina is extraordinary in being able to bring the Pertamina Grand Prix of Indonesia to Lombok Island,” said Adham.

The benefits of the international event are not only felt by restaurant entrepreneurs, but also by other types of businesses such as souvenir traders. Ria Anggraini, a salesperson from Natasya Collection, a souvenir shop in the Kuta Beach area, also admitted that there were quite a lot of buyers when the Pertamina Grand Prix of Indonesia was held.

Meanwhile, VP of Corporate Communication of Pertamina, Fadjar Djoko Santoso, stated that the 2024 Pertamina Grand Prix of Indonesia is expected to provide a positive multiplier effect for the people of Lombok. Hearing stories of economic growth from local entrepreneurs brings a sense of pride to Pertamina.

Pertamina, as a leading company in the energy transition sector, is committed to supporting the 2060 Net Zero Emission target by continuing to encourage programs that have a direct impact on achieving the Sustainable Development Goals (SDGs). All of these efforts are in line with the implementation of Environmental, Social & Governance (ESG) across all of Pertamina’s business lines and operations.

For information, the winner of the 2024 Pertamina Grand Prix of Indonesia was Jorge Martin, who was able to maintain the leading starting position. He dominated the race for 27 laps with a time of 41 minutes 4.389 seconds.

September 26, 2024, detikFinance

(https://finance.detik.com/berita-ekonomi-bisnis/d-7559165/pertamina-grand-prix-of-indonesia-jadi-ajang-kebanggaan-masyarakat-lombok)

(https://finance.detik.com/berita-ekonomi-bisnis/d-7561991/pertamina-grand-prix-of-indonesia-2024-dongkrak-omzet-pengusaha-lokal)

President Joko Widodo today, Tuesday (24/09/2024), inaugurated the first bauxite injection for the Smelter Grade Alumina Refinery (SGAR) Phase 1 project of PT Borneo Alumina Indonesia (BAI) located in Mempawah Regency, West Kalimantan. This smelter is divided into two phases with a total investment of up to US$ 1.7 billion or around IDR 25.67 trillion (assuming an exchange rate of IDR 15,100 per US$), consisting of US$ 900 million for the first phase and US$ 800 million for the second phase. The first phase of the Mempawah SGAR was built with an alumina production capacity of up to 1 million tons per year.

SGAR Phase 1 is a national strategic project from the MIND ID Mining BUMN Holding or PT Mineral Industri Indonesia (Persero) and the group through subsidiaries of PT Indonesia Asahan Aluminum (Inalum) and PT Aneka Tambang Tbk (ANTM), namely PT Borneo Alumina Indonesia (BAI). With the operation of SGAR, this indicates that Indonesia has an integrated bauxite downstream project to downstream products in the form of aluminum.

MIND ID President Director Hendi Prio Santoso said that this is an important achievement in the metal mineral industry in the country. With the inauguration of the first bauxite injection of the SGAR project, this makes the project integrated from upstream to downstream, from bauxite mining to later being processed into alumina to then be sent as raw material for aluminum to be produced by Inalum.

After this phase 1, the company will continue to work on the second phase project with an alumina production capacity of 1 million tons per year. For this reason, his party also asked for support from the local government to facilitate investment in the next phase, both in terms of licensing, land acquisition, and so on.

“But with our vision of carrying out full bauxite downstreaming and also wanting to help the government ease the burden on foreign exchange, we will increase aluminum production to reach 900 thousand tons, so additional raw materials are needed, so we are ready to add another 1 million tons (alumina),” he explained.

Second, he continued, there will be the creation of economic output of more than IDR 150 trillion.

This Phase 1 SGAR will later connect the supply chain between bauxite ore minerals in West Kalimantan produced by PT Aneka Tambang Tak (ANTM) and the Inalum aluminum smelter in Kuala Tanjung, North Sumatra. Bauxite ore mineral injection is the first series in the alumina production process with the first alumina production target planned for November 2024. The commissioning or trial process will be carried out in stages with a gradual increase in production or ramp up production until December 2024.

The SGAR Phase 1 Project is planned to enter the full alumina production stage in the first quarter of 2025, with a target commercial operation date (COD) or commercial operation at the end of February 2025. The SGAR Phase 2 Project is an expansion of the SGAR Phase 1 Project which will also be located in Mempawah, West Kalimantan and will also have an alumina production capacity of up to 1 million tons per year with an operational target in 2028.

Through the operation of the SGAR Phase 1 and Phase 2 Projects, domestic alumina production will increase to 2 million tons per year with the absorption of bauxite ore minerals reaching 6 million tons per year.

This is in line with Inalum’s corporate action plan to increase its aluminum production capacity to 900,000 tons per year. In addition, Inalum’s aluminum smelter currently has an aluminum production capacity of up to 275,000 tons per year, all of which are prioritized to meet domestic aluminum needs.

September 24, 2024, CNBC Indonesia

(https://www.cnbcindonesia.com/news/20240924114314-4-574152/sah-ri-punya-proyek-hilirisasi-bauksit-aluminium-terintegrasi-pertama)