REPUBLIKA.CO.ID, JAKARTA -- The Investment Coordinating Board (BKPM) has set an investment target of Rp594.8 trillion in 2016, up 14.5 percent compared to Rp519.5 trillion target set this year.
The 14.5 percent increase in the investment projection in 2016 is aimed at supporting the government's economic growth target set at 5.5 percent for 2016.
BKPM Chief Franky Sibarani noted in a press statement on Sunday that his board is confident of achieving its investment target next year.
He said that investment realization in the first semester of 2015 had reached 50 percent of the targeted Rp519.5 trillion.
"In his financial note address on Aug 14, President Joko Widodo mentioned that private investment, as one of the sectors, will support the efforts to achieve an economic growth projection of 5.5 percent in 2016. We are ready to support the economic growth target," Sibarani affirmed.
The BKPM chief noted that of the Rp594.8 trillion target in 2016, about Rp386.4 trillion is expected to come from foreign investment and Rp208.4 trillion from domestic investment.
He explained that the secondary sector, or processing industries, is expected to contribute Rp313.5 trillion, or about 52.7 percent.
The tertiary sector, which includes infrastructure, is projected to contribute Rp183.7 trillion, or 30.9 percent while the primary sector, or commodities, is expected to contribute Rp97.6 trillion, or 16.4 percent.
The BKPM is optimistic that investment will support economic transformation from a consumption-based to a production-supported economy.
"The realization of investment that focuses on infrastructure and processing industries will support the creation of production-based economic fundamentals," he pointed out.
In order to achieve its goals, the BKPM will maintain five sectors outlined as investment targets: infrastructure, agriculture, industry, maritime, and tourism.
The investment board will increase the number of countries, which will become its investment focus. The nations on the BKPM's target are the United States, Britain, Australia, the United Arab Emirates, and the Middle East countries.
This is to add to the list of countries that had earlier become the investment focus: Japan, China, South Korea, Singapore, and Taiwan.
"The BKPM will also monitor ongoing investment projects to ensure that they will enter their commercial production phases based on plans, so that they would have a greater impact on the economy," Sibarani remarked.
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