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Rabu, 27 April 2022

Indonesian Investment Moves to Rise After Pandemic, First Quarter 2022 Investment Realization: IDR 282.4 trillion

Jakarta, 27 April 2022 – The Ministry of Investment / Investment Coordinating Board (BKPM) published investment realization data within first quarter of 2022 (January-March) in the amount of IDR 282.4 trillion. It is 28.5% higher than realization in the same period of 2021 and also 16.9% higher than realization in the previous quarter. The realization contributed 23.5% to the total target of IDR 1,200 trillion in 2022.

Bahlil Lahadalia said, "With an increase percentage of investment realization in Quarter I - 2022, it shows that domestic and foreign investors' trust is increasing toward government policies, especially in the investment policy."


Based on Investment Report, DDI’s growth in the first quarter of 2022 increased by 25.1%, from IDR 108.0 trillion in the first quarter of 2021 to IDR 135.2 trillion. Transportation, Warehouse and Telecommunications sector contributed most of the realization of domestic investment. Meanwhile, in the same period, FDI increased 31.8% compared to first quarter 2021, from IDR 111.7 trillion to IDR 147.2 trillion. The FDI realization was contributed by the Basic Metals, Metals, Non-Machinery and Equipment Industry sector. As Basic Metal, Metallic, Non-Machinery and Equipment Industry sector plays significant role for FDI, it is in line with Presiden Joko Widodo’s policy to export ban of raw materials on mining in order to promote down-streaming activities, particularly for nickel processing industry.


The top five sectors contributed to FDI and DDI realization in first quarter 2022 are: Metal Industry, Metal-Based Goods, Non-Machinery and Equipment Industry (IDR 39.7 trillion, 14.0%); Transportation, Warehouse, and Telecommunication (IDR 39.5 trillion, 14.0%); Mining (IDR 35.2 trillion, 12.5%); Housing, Industrial Estate, and Office Building (IDR 24.9 trillion, 8.8%); and Electricity, Gas, and Water Supply (IDR 23.1 trillion, 8.2%). The manufacturing sector still plays a very important role in increasing investment realization and remains a driver of economic growth.


Ministry of Investment/BKPM documented the top five locations where FDI and DDI occured are: Special Territory of Jakarta (IDR 40.4 trillion, 14.3%); West Java (IDR 39.5 trillion, 14.0 %); Riau (IDR 23.7 trillion, 8.4%); East Java (IDR 23.6 trillion, 8.4%); and Central Sulawesi (IDR 20.0 trillion, 7.1%).


As a reflection of economic equality in Indonesia, investment growth outside Java is currently quite stable and continues to increase significantly. The realization of investment of outside java in the first quarter of 2022 reached IDR 148.7 trillion. It increased by 16.6% to IDR 127.5 trillion compared to fourth quarter of 2021. It is indicated by the existence of Riau and Central Sulawesi provinces as part of top five investment locations for FDI as well as DDI and contributed 8.4% and 7.1% to total investment realization. The significant growth of investment in outside Jawa for FDI in this quarter is shown by Central Sulawesi which grew the fastest of 12.9% followed by Riau of 9.9% and North Maluku 7.3%.


"I was ordered by the President to create inclusive and quality investment, where investment in Java and outside Java arranged in good proportions, the added value of natural and mineral resources was increased, as well as the growth of new economic in the region. For this reason, all units in the Ministry of Investment / BKPM with out of the box efforts in the context of achieving inclusive investment" explained Bahlil Lahadalia.


The top five country of origin for FDI are: Singapore (US$ 3.6 billion, 34.8%); Hong Kong (US$ 1.5 billion, 15.0%); China (US$ 1.4 billion, 13.2%), Japan (US$ 0.8 billion, 8.0%); and United States Of America (US$ 0.6 billion, 6.1%).


From the data above, it can be seen that in the last two quarters, the United States has entered the top 5 countries of origin for FDI, which proves the diversification of sources of origin that is not only focused on the East Asia region.


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Appendix


DDI investment realization in the first quarter of 2022 increased by 25.1 % compared to the same period in 2021 from IDR 108.0 trillion to IDR 135.2 trillion.


FDI investment realization in the first quarter of 2022 increased by 31.8 % compared to the same period in 2021 from IDR 111.7 trillion to IDR 147.2 trillion.


The highlights of the investment realization of the DDI and FDI in Q1 2022 are as follows :


1. Domestic Direct Investment Realization

DDI realization based on top five leading sectors were Transportation, Warehouse, and Telecommunication (IDR 27.0 trillion); Mining (IDR 18.4 trillion); Housing, Industrial Estate, and Office Building IDR 17.5 trillion); Food Crops, Plantation, and Livestock (IDR 10.1 trillion); and Foods Industrial (IDR 9.7 trillion). If all of those industrial sectors are combined, it shows that the industrial sectors contributed as much as IDR 25.6 trillion or 18.9% of the total DDI.

DDI realization based on top five leading locations were: Special Territory of Jakarta (IDR 22.9 trillion); West Java (IDR 21.2 trillion); East Java (IDR 15.4 trillion); East Kalimantan (IDR 10.2 trillion); and Riau (IDR 9.1 trillion).


2. Foreign Direct Investment Realization

FDI realization based on top five leading sectors are: Metal, Metal Goods, Except Machinery and Equipment Industry (US$ 2.6 billion); Mining (US$ 1.2 billion); Electricity, Gas, and Water Supply (US$ 1.0 billion); Transportation, Warehouse, and Telecommunication (US$ 0.9 billion); and Chemical and Pharmaceutical Industry (US$ 0.8 billion). If all of those industrial sectors are combined, it shows that the industrial sectors contributed as much as US$ 5.4 billion or equivalent to 52.9% of the FDI total realization.

FDI realization based on top five leading locations were: Central Sulawesi (US$ 1.3 billion); West Java (US$ 1.3 billion); Special Territory of Jakarta (US$ 1.2 billion); Riau (US$ 1.0 billion); and North Maluku (US$ 0.7 billion).

FDI realization based on top five of country of origin were: Singapore (US$ 3.6 billion, 34.8%); Hong Kong (US$ 1.5 billion, 15.0%); China (US$ 1.4 billion, 13.2%); Japan (US$ 0.8 billion, 8.0%) and United States of America (US$ 0.6, 6.1% billion).


3. Distribution of Project Locations

In the first quarter of 2022, investment realization in Java Island equal to IDR 133.7 trillion and investment realization outside Java Island equal to IDR 148.7 trillion. When compared to the same period in 2021, there was an escalation in Java Island by 26.9% and an increase in investment of outside Java Island by 30.0%.


4. Indonesian Labor Absorption

The realization of Indonesian labor absorption in the first quarter of 2022 reached 319,013 Indonesian labors which consists of 190,728 Indonesian labors from DDI projects and 128,285 Indonesian labors from FDI projects.


5. The investment realization based on Regions in the period of January – March 2022 can be figured as follows:

a. The investment realization in Sumatera equal to IDR 63.3 trillion (22.4%), consists of IDR 33.7 trillion of DDI and US$ 2.1 billion of FDI.

b. The investment realization in Java equal to IDR 133.7 trillion (47.3%), consists of IDR 72.9 trillion of DDI and US$ 4.2 billion of FDI.

c. The investment realization in Kalimantan equal to IDR 29.1 trillion (10.3%), consists of IDR 19.4 trillion of DDI and US$ 0.7 billion of FDI.

d. The investment realization in Sulawesi equal to IDR 31.7 trillion (11.3%), consists of IDR 3.5 trillion of DDI and US$ 2.0 billion of FDI.

e. The investment realization in Bali and Nusa Tenggara equal to IDR 8.2 trillion (2.9%), consists of IDR 5.0 trillion of DDI and US$ 0.2 billion of FDI.

f. The investment realization in Maluku and Papua equal to IDR 16.4 trillion (5.8%), consists of IDR 0.7 trillion of DDI and US$ 1.1 billion of FDI.

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