Indonesia to Open Cold Storage, Manufacturing Sectors to Foreign Investors
Indonesia is set to allow foreigners to wholly own cold storage businesses, sugar factories and rubber manufacturing companies in an attempt to attract more foreign investment, a senior official said on Monday.
The move is part of the upcoming revision to the so-called negative investment list, which restrict foreigners ownership in sectors deemed strategic or crucial to the national interest.
Franky Sibarani, the chairman of Investment Coordinating Board (BKPM), said that foreigners would be able own 100 percent of cold storage businesses across Indonesia.
"The cold storage business will be open without any region restriction," Franky said after a meeting at Coordinating Ministry for Economic Affairs.
Under current regulations, the foreign ownership in the sector is capped at 33 percent in Sumatra, Java and Bali, and at 67 percent in any other region.
In the meeting, the government also decided to allow foreigners to own sugar and rubber manufacturing companies, as long as they are willing to take up 30 percent raw material supply from local farmers.
The move follows an earlier decision to allow foreigners to control e- commerce businesses. Franky said that e-commerce with investment above Rp 1o billion ($72 million) would be open for foreigner investors who agreed to work with local warehousing companies.
The warehouse business itself is also subject to liberalization, Franky said, but the government has yet to decide the level of foreign ownership that would be allowed. The relevant ministries are now discussing a foreign ownership level of between 33 percent to 67 percent for that sector, he said.
President Joko Widodo has set an end-January deadline for his administration to come up with the first negative list revision .
Coordinating Economics Minister Darmin Nasution said earlier that the government would open up to 17 business sectors to foreigners, including transportation services, home appliance manufacturing, assisted living, cemetery services, movie theaters as well as convenience and department stores.