The Investment Coordinating Board (BKPM) stated that it had made special recommendations for 6,758 companies to invest in Indonesia. With this special recommendation, there are 11 thousand foreign workers (TKA) who have the potential to enter and work in Indonesia. Deputy of Investment Climate Development, BKPM Yuliot, revealed that the Covid-19 pandemic has made the government restrict foreign workers from entering Indonesia. In fact, many companies are willing to invest their funds in Indonesia and need foreign employees.
Yuliot said this had become an obstacle to the realization of investment in Indonesia. This is because investors are holding back their investments in the country. “The breakthrough made by BKPM, we provide recommendations to companies that carry out investment activities, company leaders, directors, and commissioners, foreign workers can enter and carry out investment commitments," said Yuliot in a webinar entitled Opportunities to Encourage Investment During a Pandemic, Monday (9 / 11). Yuliot stated that the special recommendation succeeded in making investments from companies that needed foreign workers more smoothly. Thus, investment in Indonesia will not decline too deeply during the pandemic.
Even though it opens the gap for foreign workers to enter, he guarantees that the investment from 6,758 companies will also open up new jobs in Indonesia. Yuliot stated that the thousands of companies have the potential to absorb 3 million workers in Indonesia. Yuliot further explained that his party is targeting the realization of investment during 2021-2024 to reach IDR 4,983.2 trillion. For 2021 alone, BKPM is targeting the realization of investment to touch IDR 854.5 trillion.
"With various instruments issued by the government, there is a Work Creation Act (UU), we hope it will provide convenience, we are optimistic that BKPM can achieve the target," Yuliot explained. In addition, Yuliot is also quite confident that the investment climate will be more positive in Indonesia. He projects the incremental capital output ratio (ICOR) to fall from 6.8 percent to 3.9 percent.
ICOR can be referred to as how much additional investment is needed to increase the growth of Gross Domestic Product (GDP). The lower the ICOR, it means higher investment efficiency. Conversely, if the ICOR is high, the investment will be less impactful or inefficient. "When compared with Malaysia ICOR 5.4 percent, the Philippines 4.1 percent, and Vietnam 3.7 percent. Indonesia's main competitor is Vietnam, this illustrates a more efficient investment activity," concluded Yuliot.