INDONESIA is seeking new investment worth more than US$800 billion, equivalent to 65 per cent of its current GDP, within the next five years to reach its 8 per cent economic growth target compared with 5 per cent currently, its investment minister said.
Jacking up the economic growth by three percentage points within five years is one of President Prabowo Subianto’s key pledges, a target analysts say is ambitious as major structural reforms to South-east Asia’s largest economy would need to be implemented.
Investment Minister Rosan Roeslani said Indonesia needs additional investment – whether domestic or foreign – worth 13,528 trillion rupiah (S$1.1 trillion) between 2025 and 2029 to reach the 8 per cent growth.
In 2027, GDP growth is expected to reach 8.3 per cent before easing to 7.8 per cent in 2029, the minister’s presentation showed.
“Investment is the second-biggest contributor to our GDP growth after household consumption,” he said on Thursday in a meeting with regional leaders.
To achieve the investment target, the government will focus on a policy to develop the downstream industry in natural resource sectors beyond mining such as fisheries and forestry.
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Indonesia is also keen to develop its seaweed industry, benefiting from its vast seas.
Rosan also promised to give more certainty for investors in getting business permits by saying that these will be issued within agreed time frames.
Uncertainty in the timeline of getting business permits has been one of major issues in attracting investment.
At the same meeting, senior economic minister Airlangga Hartarto said the 8 per cent GDP growth target hinges on investment that must grow at around 10 per cent from the current 5 per cent, household consumption growth at 5 to 6 per cent and exports at around 9 per cent. REUTERS
