Investment Coordinating Board (BKPM) Head Bahlil Lahadalia has offered investment opportunities in 10 New Balis to Australia during a meeting between both governments.
According to Bahlil in a written statement in Jakarta, on Monday, February 10, 2020, Indonesia is currently developing tourist centers aside from Bali, dubbed as the 10 New Balis, with Labuan Bajo and Mandalika considered to be potential investments for Australian investors.
“Many Australian tourists go to Bali. Now, we ask Australian entrepreneurs to develop the two regions so that tourists from Australia will not only go to Bali, but also to Mandalika and Labuan Bajo,” he said during his working visit to Australia.
In addition to tourism, Bahlil also pushed for investment in education, as Australia already has a number of world-class educational institutions, particularly in the tourism and health care industries.
The education investment from Australia will be integrated with the development of the 10 New Bali tourist centers. With the existence of standardized higher education/ vocational institutions from Australia, Indonesian workers are expected to get work-ready certification internationally.
Increased cooperation and investment have been the goal of the ratification of the Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA). Increased economic cooperation has been encouraged to make the two countries become economic powerhouses in the Asia Pacific region.
On top of that, the cooperation provides broader market access for the two countries to become part of the global supply chain. Indonesia is considered to be a production hub with supplies from Australia to be exported to other regions, such as the Middle East. In this case, Indonesia’s strategic location has leveraged the country’s competitiveness in attracting investment from other countries.
Australian Minister of Trade, Tourism and Investment, Simon Birmingham, added that a number of Australian business representatives had expressed their interest in developing the country’s new capital, particularly in infrastructure support.
In response, Bahlil said the Indonesian government would expedite the investment process through the Omnibus Law, which is presently still in progress.
“We have the Omnibus Law that can accelerate the investment process. This is what we offer them. Through the Omnibus Law, all permits related to investment and fiscal incentives will be issued by the BKPM,” Bahlil stated.
In the 2015-2019 period, Australia only invested US$ 1.8 billion, ranking 12th among other foreign country investors in Indonesia.
The dominant sectors were mining (44.7 percent), the metal industry excluding machinery and industrial equipment (11.3 percent), and plantations and animal husbandry (9.4 percent). The Australian investments were focused in Borneo (23.5 percent) and Sumatra (23.1 percent).