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Indonesia FDI Accelerates to a New Record High in Q2 2022

Jakarta Globe
July 20, 2022 | 2:03 pm
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The Minister of Investment/Head of Investment Coordinating Board (BKPM) Bahlil Lahadalia delivers a speech at an event in Karanganyar, Central Java, on July 6, 2022. (Antara Photo/Dhemas Reviyanto)
The Minister of Investment/Head of Investment Coordinating Board (BKPM) Bahlil Lahadalia delivers a speech at an event in Karanganyar, Central Java, on July 6, 2022. (Antara Photo/Dhemas Reviyanto)

Jakarta. Foreign direct investment into Indonesia has accelerated to a new record high from April to June this year, highlighting the country's robust economic recovery amid a prolonged Covid-19 pandemic and new global inflation and recession threats.  

The Ministry of Investment/Investment Coordinating Board (BKPM) announced Tuesday that the foreign direct investment into Indonesia reached Rp 163.2 trillion in the second quarter, or up 39.7 percent in rupiah term from the same period last year. It accelerated from a 30.2 percent pace in the first quarter. 

Domestic direct investment also increased, albeit at a slower pace of 30.9 percent, to Rp 139 trillion from the same period last year. 

In total, BKPM recorded Rp 302.2 trillion investment in the second quarter, up 35.5 percent from Rp 223 trillion last year. BKPM data exclude investments in oil and gas, finance and banking, home industries, or small and medium enterprises.  

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The Minister of Investment/Head of BKPM Bahlil Lahadalia said it was the fastest investment growth on record in years. "This performance also signifies investment recovery since the pandemic hit two years ago," Bahlil said. 

Incoming investment is still dominated by outside Java, amounting to Rp 157.1 trillion, or 52 percent of the total investment. Meanwhile, regions outside Java attracted Rp 145.1 trillion, or 48 percent of the total investment.

The basic metal, metal goods, non-machinery, and equipment industries lead with Rp Rp 48.2 trillion in investments in the second quarter, followed by the mining sector with Rp 33 trillion and the housing, industrial estates, and offices sector with Rp 26.7 trillion.

The transportation, warehouse, and telecommunications sectors came fourth with Rp 25.6 trillion, and the food industry came fifth with Rp 22.4 trillion.

Cumulatively, the total investment in Indonesia reached Rp 584.6 trillion in January-June, an increase of 32 percent from last year. That was equivalent to 60.4 percent of BKPM's target of Rp 968.4 trillion this year.

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