- POSTED: 24 Dec 2013 15:15
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Indonesia said on Tuesday it will allow increased overseas investment in a range of sectors, as it seeks to boost slowing growth and lure back foreigners who fled during recent market turmoil.
JAKARTA: Indonesia said on Tuesday it will allow increased overseas investment in a range of sectors, as it seeks to boost slowing growth and lure back foreigners who fled during recent market turmoil.
Foreign investors in Southeast Asia's top economy will be given increased access in areas including power plants, ports and airports, and the pharmaceuticals industry.
The move comes after economic growth slipped to its slowest pace in nearly four years and foreign investors dumped Indonesian stocks and the rupiah in recent months as the US moved to reduce its stimulus programme.
"We want to maintain Indonesia's economic growth, which we anticipate will be impacted as the global economy slows," Chief Economic Minister Hatta Rajasa told reporters, as he announced the changes.
They involve a revision of the so-called "negative investment list", which limits overseas investment in areas considered sensitive.
Foreigners will be allowed investments of up to 100 per cent in power plants built under public-private partnerships and with capacity of more than 10 megawatts, said Mahendra Siregar, the head of Indonesia's investment coordinating board.
This is up from a previous cap of 95 per cent.
They will be allowed to invest up to 49 per cent in airports and up to 95 per cent in sea ports and tolls roads, he said.
Foreigners will also be allowed to take stakes in pharmaceutical companies of up to 85 per cent, up from 75 per cent.
President Susilo Bambang Yudhoyono must sign a decree for the changes to take effect but Rajasa said he hoped this would happen in the near future.
Foreign direct investment has been a key driver of the vast Indonesian archipelago's prolonged economic boom and hit a record of almost US$23 billion in 2012, according to Dow Jones Newswires.
But foreign investment growth has eased in recent quarters as economic growth slows. Annual growth is expected to come in at less than six per cent for the first time in four years in 2013.