Jakarta. The materialized foreign direct investment in Indonesia stood at $45.6 billion last year which the government claimed to be the highest FDI in the country’s history. 

The amount represents a 44.2 percent increase from the total FDI a year earlier and accounts for 54.2 percent of overall investment in the country in 2022, Investment Minister Bahlil Lahadalia said on Tuesday.

“We must be grateful that amid the highly volatile global economy, the FDI in Indonesia has managed to grow by 44.2 percent,” Bahlil said in a video conference. 

Bahlil said Indonesia recorded among the highest FDI growth in the world last year thanks to political stability and supportive government policies under the President Joko Widodo government.

Last year's combined domestic and foreign investments in Indonesia totaled Rp 1,207 trillion -- equivalent to $84.1 billion under the dollar terms set at Rp 14,350 per dollar by the 2022 state budget -- an increase of 34 percent from the amount in 2021, he said.

The achievement surpassed the president’s target of Rp 1,200 trillion in overall investment for 2022, he added.

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By sector, the metal, machinery, and equipment industries received the biggest share of FDI, amounting to $10.96 billion, according to government data.

The mining sector was at the distant second with $5.1 billion, trailed by the chemical and pharmaceutical industry ($4.5 billion), the transportation and telecommunication sector ($4.1 billion), electricity, gas, and water supplies ($3.8 billion), the property sector ($3 billion), the food industry ($2.4 billion), the agriculture and livestock sector ($1.8 billion), the paper and printing industry ($1.6 billion), services ($1.6 billion), and vehicle industry ($1.5 billion).

Neighboring Singapore is the biggest source of Indonesian FDI in 2022, with investment amounting to $13.3 billion.

Other major foreign investors have come from China ($8.2 billion), Hong Kong ($5.5 billion), Japan ($3.6 billion), Malaysia ($3.3 billion), the United States ($3 billion), South Korea ($2.3 billion), and the Netherlands ($1.2 billion).

But Bahlil said the country of origin doesn’t necessarily represent the nationality of investors or the original source of the money.

South Korea’s Lotte Corporation, for example, invested in Indonesia through its Malaysian hub, the minister explained.

The combined domestic and foreign investment created more than 1.3 million new jobs across Indonesia last year, he said.

Another encouraging fact about last year’s FDI is that provinces outside of Java have become among the biggest recipients.

Central Sulawesi, home to a major nickel processing industry, received the largest amount of FDI at $7.5 billion, according to government data.

North Maluku is ranked third with $4.5 billion in FDI while Riau is seventh with $2.7 billion.

Equal distribution of investment will allow the birth of new economic growth engines across Indonesia with less reliance on the most-crowded island of Java, Bahlil said.