On Tuesday 8th July, I was able to witness a major step forward to boost investment relations between Indonesia and the European Union. The Indonesia Investment Coordinating Board (BKPM) and the Delegation of the European Union to Indonesia signed a Memorandum of Understanding (MoU) to officially establish an EU Desk within BKPM.
The activities of the EU Desk include consultancy within BKPM to work closely with a small team of BKPM officers, therefore providing on-the-job training. The focus of the work involves liaising with potential European investors and proactively promoting Indonesia as a destination for investment. In concrete terms this means e.g. set up databases of information that is of interest to EU investors, develop procedures to respond to queries from investors or develop marketing material.
In my opinion many investors are looking to Indonesia with great interest, however their decisions will be based on transparency and long term certainty. I believe that the EU desk can significantly improve the level of understanding on both sides and therefore increase long-term European investment in Indonesia.
This is also reflected by the fact that the MoU was signed on 8th July, just one day before the Indonesian presidential elections. BKPM Chairman Mahendra Siregar underlined that the EU is one of the major investors in Indonesia as well as the nation’s long-standing major trading partner. “Today we are committed to stepping up our partnership to another level through the technical assistance given by the EU”, he said and highlighted the desire of increased cooperation regardless of the elections.
EU Ambassador Olof Skoog emphasised the importance of strengthening the economic relationship between the EU and Indonesia. While trade and investment between the EU and Indonesia have shown excellent growth, there remains untapped potential and the establishment of the EU Desk is a significant step towards unleashing these potential and opportunities. “As EU ambassador I’m proud that we have been able to sponsor this initiative”, Skoog concluded.
The activities of the EU Desk will be implemented within the framework of the EU-Indonesia Trade Cooperation Facility (TCF) Project, which is designed to support the Indonesian government’s capacity to improve the trade and investment climate in Indonesia and to contribute to the country’s long-term sustainable economic development.
I am curious to see how trade and investment between the EU and Indonesia will develop in the future. However, I am sure that the establishment of the EU Desk within BKPM was a significant step towards understanding on both sides about the benefits and prerequisites for increased European investments in Indonesia.