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Indonesia’s Politic and Economy Stable – Come Invest?

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Airlangga Hartarto photo MNC media

The Coordinating Minister for the Economy Airlangga Hartarto has guaranteed foreign investors that Indonesia is a country that should be considered as a market, production base, and export centre.

“Access to Indonesia means entering one of the most stable regions politically and economically in the world,” conveyed Hartarto virtually at the Round Table Discussion Meeting: Indonesia and Australia Trade and Investment Initiative.

He stressed that the government is optimistic but remains alert to respond to the prospects of the economy in 2023. Various policies have been implemented including the ending of PPKM policies. Finishing pandemic restrictions is expected to encourage community mobility and the movement of the economic structure through the Job Creation Law and its derivative regulations aimed at providing legal certainty for business actors. 

Related to the implementation of risk-based business licensing through Single Submission Online, more than 3.3 million new business identification numbers have been issued. 

Indonesia’s economic growth was 5.3 percent in 2022 despite global challenges and it became the main economic engine in Southeast Asia. It accounts for 40 percent of the Southeast Asian population and 35 percent of Southeast Asia’s GDP.

The Indonesian government is encouraging various programmes to drive the economy, ranging from downstream industry to increase the added value of commodities, to structural reform through the work creation law.

“We have also prepared a list of investment priorities. Investors who invest in priority industries are entitled to get fiscal and non-fiscal incentives. Furthermore, we continue to optimise the Indonesia Investment Authority (INA) as alternative financing for economic development,” he explained.

Indonesia is currently encouraging the development of an electric vehicle ecosystem. Indonesia itself is the main producer of nickel ore which is a core component of batteries, while Australia is an important partner for Indonesia as the main supplier of lithium which is the main component of electric batteries.

“We hope that our partnership (Indonesia-Australia) can increase our country’s competitiveness,” he added. 

Trade and investment between the two countries have the potential to improve and have space to develop. For this reason, the government is encouraging Australia to explore Indonesia more as an Australian investment and trade destination.

Also Read Indonesia’s Golden Age: The Tiger is Awake

To expand market access, Indonesia will continue trading cooperation through the Indonesia-Australia Comprehensive Economic Partnership Agreement (IA CEPA). This partnership is expected to increase the value of trade between the two countries.  

“We must strengthen our economic partnership. Indonesia will remain firm in encouraging partnerships and cooperation with the region,” he said.

Indonesia and 14 other countries, including Australia, collaborated through the Indo-Pacific Economic Framework (IPEF) Forum for Prosperity which focused on Trade, Supply Chain, Clean Economy, and Fair Economy in 2022.

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