Jumat 08 Dec 2023 20:43 WIB

Indonesian President Says 2024 Economic Growth Needs Rp 1.650 Trillion Investment

The government targets 2024 economic growth of 5.1-5.7 percent.

President Joe Biden watches Indonesian President Joko Widodo (left) speak at an event on global infrastructure and investment during the G7 summit in Hiroshima, Japan, Saturday (20/5/2023).
Foto: AP Photo/Susan Walsh
President Joe Biden watches Indonesian President Joko Widodo (left) speak at an event on global infrastructure and investment during the G7 summit in Hiroshima, Japan, Saturday (20/5/2023).

REPUBLIKA.CO.ID, JAKARTA -- Indonesian President Joko Widodo (Jokowi) said in order to reach the 2024 economic growth target of 5.1-5.7 percent, it needs to realize an investment of Rp 1,650 trillion.

At the National Coordination Meeting of Investments in Jakarta, Thursday (7/12/2023), Jokowi said that achieving the realization of Rp 1.650 trillion investment in 2024 is not an easy thing amid the current global situation. Therefore, the President stressed to each side to work hard in order to attract investments according to the target so that the economic growth of 2024 is achieved.

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“It's not easy in the current world situation, it's not supportive. But I believe that our hard work will all be able to complete this investment target that we have made, Rp 1.650 trillion,” Jokowi said.

Jokowi said the experience in 2022 and 2023 teaches that without investment, it is difficult to achieve increased economic growth. That's because the wheels of Indonesia's economy still need capital flows to stimulate the economy.

“We have to compete, chase with other countries that are also pursuing investment. ” he said.

Jokowi called for improved services to investors. The Ministry of Investment/BKPM and also the local government need to immediately follow up on all problems faced by investors.

“If there is a problem solved soon, they (investors) will feel very helped without us' marketing 'because they will talk to their friends because global investors can count, for sure they will talk, 'wow we are investing in Indonesia',” the president said.

He said the Ministry of Investment/BKPM, all regional heads, all heads of departments in the regions, and all the Chief Administrators of Special Economic Areas are the spearheads of the investment ministry.

“I ask that we continue to improve the national investment climate, as well as the regions, and improve the realisation of investments,” Jokowi said.

Meanwhile, Investment Minister Bahlil Lahadalia is optimistic that this year's Rp 1,400 trillion investment target can be reached in the remaining time. Citing the Ministry of Investment data, the realization of investments in the period January-September or until the third quarter only reached Rp 1,053.1 trillion.

In other words, it is still less than Rp 346.9 trillion to reach this year's target in three months.

“This year's target of IDR 1,400 trillion, God willing, will be reached in 2023,” Bahlil explained after the 2023 Investment National Coordination Meeting on Thursday (7/12/2023).

Bahlil explained that investments entering the Motherland have been evenly distributed throughout the region, even investments outside Java have also been higher than Java that has occurred since the third quarter of 2020.

According to him, it can be achieved with the authority given to the Ministry of Investment to formulate comprehensive policies in order to attract investments optimally.

As for the third quarter of 2023, Bahlil explained that the distribution of investments outside Java has dominated with a contribution of 51 percent or Rp 190.9 trillion. Meanwhile, investment in Java amounted to Rp 183.5 trillion.

“Already in the fourth quarter of 2023, investments outside the island of Java began to level off, foreign capital investment (PMA) in Central Sulawesi beat DKI Jakarta, East Java beat Central Java, including North Maluku,” Bahlil explained.

Bahlil also believes that the flow of foreign investment during this year will still be above 50 percent. Meanwhile, for next year, BKPM is still designing various strategies to be able to attract investors in the midst of Election moments that often make investors hold back their investments.

“But my feeling during our politics is not too hot, God willing we can get through well,” Bahlil said.

From the investment realization data of the third quarter of 2023, which reached Rp 374.4 trillion, the contribution of foreign capital investment (PMA) reached Rp 196.2 trillion and domestic capital investment (PMDN) recorded IDR 178.2 trillion.

Bahlil said the pace of investments entering the country also continued to increase compared to the position during Covid-19 in 2019, when foreign investment or foreign capital investment (PMA) entering Indonesia was still difficult.

Moreover, coupled with global conditions that have not improved. However, since 2020, foreign investment flows in Indonesia have always had a share above 50 percent compared to domestic capital investment (PMDN).

“Even in the era of Covid-19, it does become a nice horror because FDI entered difficulty then global economic conditions that have not improved,” he said.

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