Friday, 19 April 2019 | 09:19 WIB

Indonesia Agriculture Ministry Accelerates Investments in Agriculture Sector

Indonesia Agriculture Ministry Accelerates Investments in Agriculture Sector (kementan)

JAKARTA, NNC - Indonesia President Joko 'Jokowi' Widodo has emphasized two key factors that must be addressed to strengthen Indonesia's economy, namely to improve export performance and open the widest investment climate in the country. Both efforts are believed to be able to support strong economic fundamentals.

With regard to investment, the Indonesia Ministry of Agriculture has deregulated regulations related to licensing, services and ease of investment.

In the field of licensing, in accordance with the provisions of Presidential Regulation Number 91 of 2017 concerning the Acceleration of Business Implementation, Minister of Agriculture Regulation No. 41/Permentan/TI.120/11/2017 concerning Electronic Licensing Services has been issued so that the licensing process at the Ministry of Agriculture is simplified.

"Pro-active efforts to increase agricultural investment have shown encouraging results. The results of this deregulation create a trend in the value of investment, from 2014 to 2017 domestic investments grew on average per year by 24.26 percent, "said Head of the Ministry of Public Relations and Public Information Kuntoro Boga Andri in his written statement.

The ongoing investment is dominated by the plantation subsector, especially oil palm, rubber, coffee, sugar cane, tea and some commodities in the livestock sub-sector, especially poultry and cattle, and horticulture. Based on BKPM data, the realization of agricultural investment in the fourth quarter of 2017 amounted to IDR159.4 trillion, an increase of 9.6 percent compared to the same period in 2015.

Each for the realization of Domestic Investments was IDR58.1 trillion, a rise of 25.8 percent compared to the achievement of the same period in 2015. And Realization of Foreign Investment was IDR101.3 trillion, up 2.1 percent.

In the sugar industry sector, the development of sugar cane plantations covers 200 thousand ha to meet the idle capacity of existing sugar mills and encourage the development of 500 thousand ha of land to meet the needs of 14 new sugar mills.

Sugar mill development is expected to be able to open new employment opportunities for 3.87 million people. "Sugar Mill investment has started with construction and will start production in 2019," Kuntoro said.

In the buffalo cattle farm sector, during the 2015-2017 period investment increased 23.3 percent, from 23 projects in 2015 to 53 projects in 2017.

When viewed from the value of investment, domestic investment increased by 451.7 percent, which was Rp27 billion in 2015 to Rp159.8 billion in 2017. Meanwhile, for FDI in 2016 it increased 84.6 percent to US $ 18.9 million US $ compared to US $ 10 ,2 million. In 2018 it was US $ 10.4 million, up 1.3 percent from 2016.

Furthermore, investment in poultry farms for the period 2015-2017 has increased by 55.1 percent, from 125 projects in 2015 to 338 projects in 2017.

When viewed from the value of investment, then domestic investment increased by 73.8 percent, namely from Rp292.2 billion in 2015 to Rp1.16 trillion in 2017.

Meanwhile, FDI increased by 400.7 percent, from US $ 63.2 million in 2015 to US $ 243.7 million in 2017.