Central Bank, Foreign Affairs Ministry Agree on Collaboration to Draw Investment
Jakarta. Bank Indonesia, the central bank, and the Foreign Affairs Ministry have agreed on a deal to exchange information and improve manpower to attract more investment into the country.
Bank Indonesia Governor Agus Martowardojo and Foreign Affairs Minister Retno Marsudi signed the memorandum of understanding for the agreement in Jakarta on Friday (03/03). A similar agreement had been signed back in 2008.
"Bank Indonesia and the Foreign Ministry need a stronger partnership to face pressure from the global economy," Agus said in a statement.
On many occasions, including during the central bank's annual meeting last year, Agus has pointed out that the global economy has not fully recovered. In which case, unstable commodity prices and a volatile financial market are two things that "increasingly have to be closely monitored."
Retno meanwhile has plans for a new diplomatic mission: to explore more economic opportunities for both Indonesian businesses abroad and foreign investors who are interested in local opportunities.
Indonesian diplomats will be tasked to promote investment opportunities available in Indonesia. Retno said more foreign investment will also mean more job opportunities in Southeast Asia's biggest economy.
Tirta Segara, Bank Indonesia's executive director for communications, said both institutions will create an annual work program for the next three years which will be thoroughly evaluated at the end of each year.
Under the agreement, the central bank will provide diplomats with a complete kit of Indonesia's economic indicators — including figures on the country's foreign exchange reserves and its balance of payment and trade.
Staff at the central bank conversely may also be asked to undertake some diplomatic assignments to promote investment.
Last year, Rp 396.6 trillion ($30 billion) in foreign investment went into the country, 8.4 percent higher compared to Rp 365.9 trillion in 2015 and also higher than the government's target of Rp 386.4 trillion.
Indonesia's Investment Coordinating Board, or BKPM, targets Rp 678.8 trillion in investment — both local and international — this year and Rp 860 trillion next year.
BKPM's investment target this year is higher than President Joko Widodo's target of Rp 670 trillion.
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