EU Supports Indonesia’s Post-Pandemic Economic Recovery

Photo: EU

Jakarta, MINA – The European Chamber of Commerce and Business in Indonesia (EuroCham) together with Indonesian Ministry of Investment (BKPM), held the Investment Dialogue “Post-Pandemic Economic Recovery; Attracting Investment through Structural Reforms on Tuesday.

The virtual dialogue aims to share views on the post-pandemic recovery plan in Indonesia and the European Union. This event also provides information on structural reforms and investment opportunities in Indonesia, especially for European investors, in order to balance the control of COVID-19 and minimize the economic impact.

The European Union Ambassador to Indonesia Vincent Piket said the European Union strongly supports Indonesia in increasing investment, especially during the recovery period after the COVID-19 pandemic.

“We welcome the return of foreign direct investment in Indonesia and hope that this dialogue forum can create harmony between investors and the Government as the regulator,” he said.

Piket explained that the European Union has launched NextGenerationEU, a recovery program worth €800 billion or around 13.3 quadrillion rupiah to support investment and reforms that will help rebuild Europe after COVID-19.

Key elements of the program include support for green transition and digital transformation. Coupled with the EU’s long-term budget, it will be the largest stimulus ever financed in Europe, totaling over €2 trillion.

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The program, which was approved by the Council of Europe in 2020, is expected to transform the economy, create opportunities and jobs by making a greener, more digital and more resilient Europe.

The Minister of Investment of the Republic of Indonesia/Head of BKPM Bahlil Lahadalia in his speech via video said that in the midst of the pandemic, the Indonesian government has been able to make adjustments and strategies in order to maintain the economy, increase economic growth, including investment.

“This is evidenced by our economic growth in the second quarter, growing 7.07%, the first contribution from consumption is 57% and investment is 31%. In the second quarter, investment growth was 8.3%,” he explained.

In the second quarter of 2021, he continued, Indonesia targets an investment of 900 trillion and has realized 49.6%.

From the 49.6%, foreign direct investment is 50.5%, meaning that the world’s trust in Indonesia is slowly starting to improve. It can be seen that in the first quarter, Switzerland was included in the top five countries investing in Indonesia and in the second quarter the Netherlands was in third place.

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“We believe that collaboration must be built both between investors and with SOEs, national entrepreneurs and MSMEs. This is an important point in the development of the investment ecosystem, especially in Indonesia now,” he added.

The same thing was conveyed by EuroCham Chair Julien Steimer who fully supports the efforts of the Indonesian government to have issued various policies to mitigate the impact of COVID-19 and encourage the investment climate to make Indonesia an attractive investment destination in the midst of the pandemic.

“Collaboration of all stakeholders to answer the challenges of the current economic recovery is very much needed. European companies in Indonesia are ready to support the government in carrying out reforms to improve the ease of doing business in Indonesia,” he said.

In this regard, continued Steimer, EuroCham has published its 2021 Recommendation Sheet to accelerate recovery and strengthen Indonesia’s economic foundation.

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The document covers various sectors reflecting the experiences and views of European business actors in Indonesia, which aims to improve economic competitiveness and ease of doing business

Géraldine Mahieu, Plt. Director of Investment, Growth and Structural Reforms at the European Commission’s Directorate General of Economy and Finance (ECFIN), confirmed NextGenerationEU will have a significant impact on GDP growth in Europe. Structural reforms included in the plan can also have significant long-term impacts.

On the same occasion, a panel discussion was also held by presenting Indra Dharmawan, Expert Staff for Macroeconomics, Ministry of Investment/BKPM who explained about structural reforms in investment in Indonesia, Brago Adijaya Putranto, Marketing Manager of the Batang Integrated Industrial Estate who explained various investment opportunities in the region.

In addition, Mauritz Klavert, President Director of Frisian Flag Indonesia; and Derek Cheng, Head of Government & Public Affairs and Partnership (Asia-Pacific), Airbus who explained the company’s investment plans in Indonesia and in the Southeast Asia region. (T/RE1)

Mi’raj News Agency (MINA)