Saturday, 25 January 2020 | 11:14 WIB

Japan-Based Industries Still Keen on Investing in Indonesia

Indonesia Minister of Industry Airlangga Hartarto (left) during a working visit to Japan (special)

JAKARTA, NETRALNEWS.COM - A number of Japanese investors in the industrial sector are still interested in continuing to invest in Indonesia. This is because they see economic, political and security conditions in Indonesia that remain stable and conducive.

This positive statement was the result of a meeting between the Indonesia Minister of Industry Airlangga Hartarto and Japanese businessmen who were members of Keidanren in Tokyo. The group of Japan's business actors was led by Vice Chairman of Keidanren Kobayashi Ken.

Meanwhile, the Minister of Industry was accompanied by the Director General of Metal, Machinery, Transportation and Electronics (ILMATE) Industry of the Ministry of Industry, Harjanto and the Ministry of Industry's Director of Maritime Industry, Transportation Equipment and Defense Equipment Putu Juli Ardika.

"We convey, the government under the leadership of President Joko Widodo is committed to creating a conducive investment climate by providing business licensing as well as fiscal and non-fiscal incentive facilities," said Airlangga.

According to him, in the second period later, Jokowi's government will focus more on encouraging efforts to increase investment in the industrial sector in Indonesia, especially those that are export-oriented and as import substitutions. To attract investors, the government also runs various programs massively to build the quality of human resources as needed in the industrial era 4.0.

"We see Japanese investment as a long term. Moreover, both countries have been strategic partners in establishing mutually comprehensive economic cooperation, "said the Minister of Industry. Japan is the second largest investor in Indonesia throughout 2018, with an investment value of US$ 4.9 billion or 16.7 percent of total foreign investments.

Airlangga added, Japan is one of the success stories of investors who want to continue investing in the country. For example in the automotive industry sector, a number of global scale Japanese producers have made Indonesia as a production base to meet domestic market needs to export.

"In West Java there are Bekasi, Karawang, and Purwakarta (Bekapur) areas, dubbed the Detroit of Indonesia, because there are Japanese investors, especially the automotive industry sector, which is the key driver," he added.

On that occasion, it was also discussed about the acceleration of the development of Patimban Port in Subang, West Java.

The strategic project is believed to be able to reduce costs and facilitate logistical access for manufacturers, especially those located in West Java industrial estates. Moreover, a special port for the automotive industry will be built to facilitate shipment of Indonesian products.

In addition to meeting the Keidanren group, the Minister of Industry also held discussions with the directors of large-scale Japanese companies such as Sojitz Corporation. "Sojitz wants to strengthen its investment in Indonesia. Therefore, they hope that the election of President Jokowi for the next period can provide investment convenience, "he explained.

Then, Airlangga met with the board of directors of Sumitomo Mitsui Banking Corporation (SMBC). SMBC is a Japanese multinational banking and financial services company, a subsidiary wholly owned by Sumitomo Mitsui Financial Group.

"We hope that SMBC can also realize successful stories for financial sector investments in Indonesia, so that it can invite the financial sector in Japan to increase their investment in Indonesia," he said.

Based on a US News survey, which has identified 20 countries as the best investment destinations in 2018, Indonesia ranks 2nd best country to invest. Meanwhile, the World Bank version of the report, Indonesia's ease of doing business ranks 73 out of 190 countries in the world. This jumped from the previous 120th place.

Kobayashi Ken said, currently Japan is ranked third for investment in Indonesia. "We express our gratitude for the support of the Indonesian Government for the business of Japanese companies in Indonesia, including in the infrastructure sector," he said.

Furthermore, Keidanren agreed with the Minister of Industry to discuss more deeply about investment opportunities in Indonesia in the future.