JAKARTA: At least US$400 million worth of investment is expected to enter Batam in Riau Islands next year, following the launch of a three-hour licensing service on the industrial island last week. The Batam Free Trade Zone Authority (BP Batam) is targeting those who are investing at least Rp 50
billion and/or employing at least 300 workers to enjoy the new service, called i23J. The i23J is the first three-hour licensing service operated by the Investment Coordinating Board (BKPM) offered on any provincial level in Southeast Asia’s largest economy.
“The new system will expedite investment in Batam, which has been long sought by potential investors,” BP Batam chairman Hatanto Reksodipoetro told The Jakarta Post during the launch of the new service on Thursday.
President Joko “Jokowi” Widodo’s administration envisions boosting investment in the country by issuing several economic stimulus packages stipulating, among other things, pledges to cut red tape and provide speedier licensing, especially for industrial estates, as the share of the manufacturing industry in gross domestic product (GDP) has been going downward in the past decade.
The requirements of i23J are much easier than what was stipulated in the government’s second economic policy package issued in September last year, saying businesspeople who want to invest at least Rp 100 billion and would employ at least 1,000 workers could enjoy the three-hour licensing service if they set up business in industrial parks.
There are eight licenses that can be processed through the new service: import identification numbers (API), investment permits or principle approvals, company certificates, taxpayer numbers, company registration receipts (TDP), customs identity numbers (NIK), foreign worker plan permits (RPTKA) and foreign worker permits.
Indonesian Ambassador to Singapore I Gusti Ngurah Swajaya said investment from the city-state still topped the list of investors in industrial parks in Batam. “Singaporean businessmen favor the Batam-Bintan-Karimun special economic zone as their investment destination.”BKPM data showed that Singaporean investment amounted to US$3.6 million during the first six month of the year. Industrial park operators lauded the launch of i23J, saying that it would likely expedite the licensing time for investment in Batam, now averaged at six months.
“The new service is a breakthrough for business here,” said Tjaw Hioeng, general affairs manager of the Batamindo Industrial Estate. During a simulation on Wednesday, the licensing process was completed in two-and-a-half hours.
But Tjaw, who is also the deputy chair of the Batam branch of the Indonesian Industrial Estate Association (HKI), argued that business players investing less than Rp 50 billion should also be allowed to enjoy i23J, saying it was “an uphill task to gather investments of more than Rp 50 billion in the sluggish economy”.
