Indonesia Vows to Stay Open to Investors as $86 Billion Booked

Investment Coordinating Board (BKPM) Chatib Basri speaking in a July 2012 seminar on investing in Indonesia in Jakarta. (SP Photo)

Investment Coordinating Board (BKPM) Chatib Basri speaking in a July 2012 seminar on investing in Indonesia in Jakarta. (SP Photo)

Indonesia pledged to remain open to overseas companies and deliver on infrastructure projects as Southeast Asia’s largest economy seeks to realize about $86 billion of foreign investment booked last year.

The presidential election due next year shouldn’t prevent the country from pursuing efforts to attract investors and spur growth, M. Chatib Basri, chairman of the nation’s Investment Coordinating Board, signaled in a Bloomberg Television interview with Susan Li in Hong Kong on Wednesday.

“Close to election the political situation tends to be heated but rationally if Indonesia wants to grow by 7 percent, it should be a country with open economy, open to the foreign investors,” he said.

Recent changes in mining industry rules to limit the export of raw materials are aimed at increasing the value of the country’s products, he said.

President Susilo Bambang Yudhoyono, whose second term ends in 2014, has promised to build more roads, bridges and ports in the world’s biggest archipelago to sustain one of Asia’s fastest growth rates.

The government has targeted expansion of as much as 6.8 percent this year, and demand from Indonesia’s growing middle class has lured companies including Toyota Motor Corp. to boost investments.

Toyota, Asia’s biggest carmaker, said in November it would build a new engine factory in Indonesia to more than double capacity as demand surges. The company opened a new $1.3 billion factory about a week ago, Basri said.

After deducting the record foreign investment of more than $24 billion received last year, Indonesia still has about $50 billion to be realized from the total booked amount of about $86 billion, he said.

The country will be able to implement infrastructure projects beyond 2014 and plans to open about 12 airports this year, he said.

Bloomberg