REPUBLIKA.CO.ID, JAKARTA -- United Overseas Bank (UOB) and the Indonesian Capital Investment Coordinating Board (BKPM) on Friday signed a Memorandum of Understanding (MOU)to attract more foreign investment into Indonesia and to increase foreign trade with the country.

The signing of the MoU was the first such collaboration between BKPM and a foreign bank in southeast Asia.

The MoU was signed by UOB Deputy Chairman and Chief Executive Officer Wee Ee Cheong and BKPM chief Franky Sibarani.

Under the collaboration, UOB corporate clients could submit proposal for principle license in Singapore, that they do not have to come to Indonesia for that purpose.

The principle license is needed by a foreign investor to establish a company in Indonesia.

The service is the first in Singapore facilitated by UOB through BKPM representative office, Indonesia Investment Promotion Centre (IIPC), in Singapore.

Read: BKPM encourages APEC economies to invest in RI's maritime sector

Apart from helping draw investment into Indonesia, UOB would also help Indonesian investors seeking expansion abroad through IIPC 1.

Vice President Director of UOB Indonesia Iwan Satawidinata said Indonesia is the main investment destination of global and Asian companies.

In the first nine months of this year, foreign investment flowing directly into Indonesia has continued to increase to reach US$21.3 billion at present or an increase of 16.9 percent from the same period last year, Iwan said.

He said 52 percent of the investment came from other countries in Asia . The largest Asian investors is Singapore accounting for 16 percent, followed by Malaysia (13.6 percent, Japan (11.6 percent), South Korea (4.7 percent) and China (3.86 percent).

He said Indonesian trade ties with the regional countries has expanded opening high business opportunities especially with the implementaiton of the Asean Economic Community (AEC) early next year.

In addition trade between China and Indonesia is expected to expand with the initiative of One Belt One Road (OBOR) launched by the Chinese government.

"Collaboration between BKPM and UOB, which has more than 200 branches in Indonesia would facilitate companies to maximize the growth trend," Iwan said in a statement here on Friday.

Cooperation with BKPM would increase connectivity of UOB in Indonesia, the largest economy in southeast Asia and main investment destination because of its growing middle class, big domestic consumption and abundant natural resources.

"Big companies are growing interested in expanding business operation in Indonesia to take advantage of the growing middle class. Companies that could meet the requirement of the middle class would be in a better position to gain from the increase in the income of middle class and growing urbanization in Indonesia, Iwan Satawidinata said.

Ever since the establishment of UOB FDI Advisory Unit four years ago, UOB has helped nearly 700 corporate clients in expanding business in this region.

MOU and BKPM started similar cooperation which has been carried out by UOB with various other investment agencies such as China Council for the Promotion of International Trade (CCPIT) aimed at increasing investment and trade between China and Indonesia.

Only recently UOB collaborated with BKPM to hold an informal meeting in Shanghai for UOB corporate clients with more than 100 delegates attending holding sessions of consultations with BKPM representatives who gave details of investment opportunities in Indonesia.

The meeting ended with Chinese companies planning to invest US$1.9 billion in tourism, steel and textile industries in Indonesia.

Franky Sibarani said he was glad he could facilitate investors in planning investment in Indonesia.

"The MoU also contributes to promoting investment in Indonesia in various sectors such as infrastructure, maritime industry , export oriented industries , etc." he said.

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