President Joko Widodo (Jokowi) prohibits investment in the liquor or alcohol industry.
This provision is contained in Presidential Regulation Number 49 of 2021 concerning amendments to Presidential Regulation Number 10 of 2021 concerning the investment business sector.
“The business fields declared are closed for investment as referred to in paragraph (1) letter a, such as Alcoholic Beverage Industry (KBLI 11010), Alcoholic Beverage Industry: Wine (KBLI 11020), and Malt-Containing Beverage Industry (KBLI 11031),” reads Article Two paragraph (2) letter b.
Even so, the president is still open to investment in the liquor trade with conditions. Business fields opened with conditions can be carried out by all investors, including cooperatives and MSMEs that meet the requirements.
Article Six paragraph (3a) states that business fields open for investment with these conditions include wholesale of alcoholic beverages namely importers, distributors and sub-distributors (KBLI a6333); retail trade on alcoholic beverages (KBLI 47221); and street retail trade on liquor or alcoholic drinks (KBLI 47826).
However, the former Mayor of Solo requires investments to meet requirements. For example, the business sector will be limited and closely monitored and regulated in separate laws and regulations in the field of control and supervision of alcoholic beverages.
In addition, Jokowi closes investments for activities that can only be carried out by the central government. These activities are of a service nature or in the context of strategic defense and security and cannot be carried out by other parties.
President Jokowi signed the regulation on 24th May 2021 and promulgated and enforced it on 25th May.
Previously, Jokowi had gone back and forth in closing investments in the alcohol industry.
He had issued Presidential Regulation Number 10 of 2021 which also prohibited investment in the liquor industry. The rule is a derivative of the Job Creation Act.
After receiving input from scholars, mass organisations, religious leaders, and local governments, the Head of State revoked the attachment to the prohibition on investment in the liquor industry in early March 2021.
Then, the attachment to the regulation was revoked one month after the Presidential Regulation was signed. Now, Jokowi has again issued a ban on investment in the liquor industry.