According to the latest investment realization data from Indonesia’s Investment Coordinating Board (BKPM), Singapore is the largest contributor with US$5.9 billion in investment, a 20 percent share of total foreign investment in 2015.
However, China, in ninth position with $0.63 billion believed to be the biggest foreign investors in Indonesia as Chinese investors often invest in other countries through proxy companies or subsidiaries that are based in other countries such as Singapore or Hong Kong which is unable to monitor investments.
Early in 2010, China has already become Indonesia’s largest trade partner through China-ASEAN Free Trade Agreement (CAFTA), and committed to assist Indonesia in infrastructural development. Chinese President Xi Jinping has ensured his support for developing Indonesia’s infrastructure by pledging to sponsor projects through the Maritime Silk Road Fund and the Asian Infrastructure Investment Bank (AIIB).
In April 2015, Xi reassured that China will encourage more companies to invest in infrastructure construction and operations in Indonesia, on a meeting with Indonesian President Joko Widodo in Jakarta during the two-day Asian-African leaders’ meeting.
As of October 2015, China has offered up to US$100 billion in total investments in various projects between the Indonesian government and Chinese investors. The mega project in which China is providing investment is the high-speed railway between Jakarta and Bandung, which will be a big contribution in supply chain.
Rani Jarkas, Chairman of Cedrus Investments, an investment pioneer with years of financial experience in Asia, said “Strong Sino-Indonesian relations will benefit Indonesian’s economy. I believe that in the long term, Indonesia will see more investments coming from China.”
Rani Jarkas, the Chairman of Cedrus Investments.
Rani Jarkas is a highly experienced financial services executive, with over 20 years of international banking experience. Currently, Mr. Jarkas is the Chairman of Cedrus Investments, a global boutique investment firm. Cedrus’ domain expertise is in life sciences, natural resources, energy, cleantech and nanotechnology. – Rani Jarkas