INDONESIA FOREIGN

DIRECT INVESTMENT
(FDI)
Created by:
Dela Apriyanti
120210180034
What Is FDI?

• investment flow to a country carried out by multinational

companies to control the production process of the
destination country
Indonesia as an attractive market
Indonesia has a huge population (fourth largest in the
world) with a large number of middle-income consumers
and is considered to be an attractive retail market. With this
condition, Indonesia is very attractive to the foregin
investors.
Factors that affect FDI
• Pull Factor: Government policy that profitable to the
investors
• Push Factor: Increase in cost of land and labor in the
investor’s home country
Why do we need the FDI?
As a developing country, we rely on the inward FDI as a
source of assistance for their growth and development
since we don’t have enough capital.
FDI in Indonesia
• Foreign direct investment (FDI) realization in Indonesia
rise 12.4 percent to IDR 108.9 trillion in Q1-2018
(excluding investment in banking and the oil & gas
sector). Meanwhile, domestic direct investment grew 11
percent to IDR 76.4 trillion.

• Indonesia's Investment Coordinating Board (BKPM) uses

a IDR 13,400 per US dollar exchange rate (as was set in
the 2018 State Budget), slightly weaker than the IDR
13,300 per US dollar rate that was used in the BKPM's
investment data last year.
FDI in Indonesia
The biggest foreign investor in Indonesia was Singapore.
Around USD $2.6 billion worth of FDI in Indonesia
originated from this small city state in the first quarter of
2018. As is widely known, many Singaporean companies
that invest in Indonesia have their parent companies in
China or India. According to BKPM Head Thomas
Lembong, investment from India - through Singaporean
units - has risen significantly in Indonesia in Q1-2018.
Impact of the FDI in Indonesia
+ FDI has helped to create jobs, which in turn boosted
productivity growth and improved access to the global
market
+ Accelerate the pace of development

‾ Threat to the local companies

Conclusion
Indonesia cannot be released from foreign investors who
invest in Indonesia in carrying out Indonesia's economic
development. However, it helps a lot in accelerate the
development.

On the other hand, it has some negative impact, cause

many sectors in business is managed by foreign investors.
References
Safitriani, Suci. (2014). Perdagangan Internasional dan FDI di
Indonesia. Buletin Ilmiah Litbang Perdagangan, Vol.8 No.1. Retrieved
from http://www.kemendag.go.id/files/pdf/2014/11/19/-1416397117

Lubis, Rizky P and Hendro Sasongko. (2015). Faktor Faktor yang

Mempengaruhi Investasi Asing Langsung pada Sektor Perkebunan
di Indonesia. Jurnal Bisnis & Manajemen, 2015, Vol. XVI, No. 2, 80-89.
Retrieved from http://www.journal.feb.unpad.ac.id/

Dhanya, R and Dr. S. Ramachandran. (2014). A Study about Foreign

Direct Investment in Indonesia. IOSR Journal of Business and
Management, Vol. 16, Issue 12.Ver.I (Dec. 2014), PP 45-4. Retrieved
from http://www.iosrjournals.org/iosr-jbm/papers/Vol16-issue12/Version-
1/G0161214547