Indonesia Investment Coordinating Board

Indonesia Investment Coordinating Board
Name	Indonesia Investment Coordinating Board
Native name	Badan Koordinasi Penanaman Modal
Formation	1973
Headquarters	Jakarta, Indonesia
Leader title	Head
Leader name	Bahlil Lahadalia

Indonesia Investment Coordinating Board

The Indonesia Investment Coordinating Board is the national agency responsible for promoting, coordinating, and facilitating foreign direct investment and domestic investment in Indonesia. It interfaces with ministries such as the Ministry of Finance (Indonesia), Ministry of Trade (Indonesia), and Ministry of Law and Human Rights (Indonesia) while engaging with provincial administrations like Jakarta and West Java as well as state-owned enterprises including Pertamina, Pelindo and Garuda Indonesia. The agency's remit touches on major projects including the Trans-Sumatra Toll Road, Nusantara development, and initiatives around Palm oil production and minerals.

History

The agency traces roots to investment coordinating efforts under the New Order (Indonesia) era and formalized structures during the Suharto administration, evolving through policy shifts in the Asian Financial Crisis and reforms linked to the Reformasi period. It played roles during major national programs such as the Industrialization of Indonesia policies of the Ministry of Industry (Indonesia) and in facilitating projects tied to the Belt and Road Initiative and Trans-Pacific Partnership discussions. Leadership changes have often paralleled administrations from Joko Widodo to predecessors, reflecting ties with institutions like the National Development Planning Agency (Bappenas) and interactions with legislative frameworks such as the Investment Law (Indonesia).

Organization and Leadership

The agency is structured with directorates coordinating sectors including manufacturing, mining, energy, infrastructure, and services, working with sectoral ministries like the Ministry of Energy and Mineral Resources (Indonesia), Ministry of Transportation (Indonesia), and Ministry of Tourism and Creative Economy (Indonesia). Its leadership has included figures from political and business circles, interacting with offices of the President of Indonesia and the Coordinating Ministry for Maritime and Investment Affairs (Indonesia). It maintains regional liaison offices in provinces including East Java, South Sulawesi, and Kalimantan and collaborates with provincial investment boards such as the Investment Board of West Sumatra. The head reports to the central cabinet and liaises with investment promotion agencies like BKPM counterparts in countries such as Singapore, Japan External Trade Organization, and UK Department for International Trade.

Functions and Responsibilities

Mandates include promotion of foreign investment and facilitation of domestic investment through one-stop services, coordination of investment licensing with bodies like the National Single Window (Indonesia), and monitoring of investment realization alongside entities such as the Central Bureau of Statistics (Indonesia). It advises on policies affecting sectors overseen by the Ministry of Agriculture (Indonesia), Ministry of Communications and Informatics (Indonesia), and Ministry of Cooperatives and Small and Medium Enterprises while mediating disputes involving companies such as Freeport-McMoRan and Vale (company). Responsibilities extend to investment mapping tied to infrastructure projects like Jakarta–Bandung High-Speed Rail and natural resource concessions regulated under the Mining Law (Indonesia).

Investment Policies and Procedures

The board implements procedures for investment application, screening, sectoral negative lists, and incentives aligned with regulations from bodies like the Financial Services Authority (Indonesia) and fiscal policies of the Ministry of Finance (Indonesia). It administers incentives such as tax allowances, tax holidays, and customs exemptions involving mechanisms coordinated with the Directorate General of Taxes (Indonesia), Customs and Excise Directorate General (Indonesia), and investment promotion schemes patterned after models used by agencies like Invest Hong Kong, Enterprise Ireland, and Germany Trade and Invest. Procedures address strategic sectors highlighted in national strategies including the Making Indonesia 4.0 initiative, renewable energy targets under the Paris Agreement, and downstreaming policies for commodities like nickel promoted by the Ministry of Energy and Mineral Resources (Indonesia).

Performance and Impact

Performance metrics are reported in terms of investment realization, job creation, and project implementation, often cross-referenced with data from the Bank Indonesia, World Bank, International Monetary Fund, and Asian Development Bank. The agency has been credited with attracting investments from multinational corporations including Samsung, Toyota, LG, Hyundai, BP, ExxonMobil, and Coca-Cola Company while facing scrutiny over issues raised by civil society groups such as Greenpeace and Amnesty International regarding environmental and social impacts of projects like coal mining and palm oil plantations. Economic outcomes intersect with macroeconomic indicators such as GDP growth rate and trade balances with partners like China, United States, Japan, South Korea, and members of the Association of Southeast Asian Nations.

International Relations and Partnerships

The board engages in bilateral and multilateral promotion with trade and investment agencies including JETRO, Austrade, US Commercial Service, European Commission delegations, and regional networks like the ASEAN Investment Area. It participates in investment forums such as the World Economic Forum, Asia-Pacific Economic Cooperation, China–ASEAN Expo, and Indonesia Investment Forum, and cooperates with international financial institutions including the Asian Infrastructure Investment Bank, Islamic Development Bank, and International Finance Corporation. Partnerships extend to development cooperation with agencies like AUSAID, Japan International Cooperation Agency, and KfW to support infrastructure and capacity building.

Category:Investment promotion agencies Category:Economy of Indonesia Category:Government of Indonesia