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Real Estate Investment Indonesia, Jakarta, 24 September 2018
Investment Opportunity in Indonesia Real Estate’s Sector
Director, of Investment Planning for Services and Economic Zones
The Investment Coordinating Board of the Republic of Indonesia
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Investment Target and Realization, 2015-2019
Investment Performance in Real Estate Sector, 2014-2018/tw2
The Opportunity and Government Support
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2
3
The Investment Coordinating Board of the Republic of Indonesia
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Investment Target
Indonesia 2015-2019
IDR 1,634,7 Trn
IDR 3.518 Trn
+115%
Total DDI and FDI
Growth in 5 years period
Renstra
2015 2016 2017 2018 2018* 2019 2019**FDI 343,7 386,4 429,0 494,7 477,4 569,9 519,3
DDI 175,8 208,4 249,8 297,8 287,6 363,0 330,7
Total 519,5 594,8 678,8 792,5 765,0 933,0 850,0Growth 12,2% 14,5% 14,1% 16.8% 12,8% 17,7% 11,1%
In IDR Trillion
Note: *) Based on 2018 Budget (RKP), to support economic growth at 5,4%.**) Based on 2019 Budget proposal
519,5594,8
678,8
792,5
933
545,4
612,8692,8
765
850
361,6
2015 2016 2017 2018 2019
Renstra RKP Realization
+15.1%Average growth per
year
Source : Renstra BKPM 2015-2019 (processed)
Based on SOURCE OF INVESTMENT FDI : 63.6%
DDI : 36.4%
Based on SECTORPrimary : 15.7%
Secondary : 53.5%Tertier : 30.8%
Based on LOCATIONJava : 46.5%
Out of Java : 53.5%
Sem-1
The Investment Coordinating Board of the Republic of Indonesia
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Investment Commitment and Realization, 2015 – 2018/Tw1
Total investment commitment (registered) 2015 - 2018/Tw1 reached IDR 8.239,1Trillion, consist of: FDI IDR 5.415,7 Trn (65,7%) and DDI IDR 2.823,4 Trn (34,3%).
Total investment realization 2015 - 2018/Tw1 reached IDR 2.036,4 Trn, consist of: FDI IDR 1.302,0 Trn (63,9%) and DDI IDR 734,4 Trn (36,1%).
Investment realization performance 2015 – 2018/Tw1 only 27,1% (Stocknet IDR 6.007,3 Trn or 72,9%).
JavaIDR 3.477,2 Trn (42,2%)
SumateraIDR 2.014,8 Trn (24,5%)
KalimantanIDR 1.015,5 Trn (12,3%)
SulawesiIDR 1.265,5 Trn (15,4%)
Bali & South East NusaIDR 346,2 Trn (4,2%)
Maluku & PapuaIDR 119,9 Trn (1,4%)
JavaIDR 1.126,9 Trn (55,3%)
SumateraIDR 349,5 Trn (17,2%)
KalimantanIDR 251,1 Trn (12,3%)
SulawesiIDR 154,1 Trn (7,6%)
Bali & South East NusaIDR 62,8 Trn (3,1%)
Maluku & PapuaIDR 92,0 Trn (4,5%)
Commitment(% of Total Commitment)
Realization(% of Total Realization)
Java
32,4%
Kalimantan
24,7%Sumatera
17,3% Sulawesi
27,6%
Bali & NT
18,1%
Maluku &Papua
76,7%
Investment realization performance compare to Investment commitment per region, 2015-2018/Tw1
Source: BKPM, 2018 (processed)
The Investment Coordinating Board of the Republic of Indonesia
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Total
IDR 2.212,7 Trillion
PMDN
IDR 815,0 Trillion(36,8%)
PMA
IDR 1.397,7 Trillion(63,2%)
Based on Sectors (DDI & FDI)
Based on Location (DDI & FDI)
SumateraIDR 380,1 T
(17,2%)
KalimantanIDR 279,4 T
(12,6%) Maluku & Papua IDR97,6 T (4,4%)
SulawesiIDR 164,8 T (7,4%)
Java IDR 1.221,3 T (55,2%)
Based on Country Origin (FDI)
Realization in Numbers (DDI & FDI)
• Investment realization in outside Java Island reached IDR 991,4 trillion (44.8%).• Investment realization in Java Island reached IDR 1.221,3 trillion (55,2%).
Investment realization 2015-2018T W2 reached IDR 2.212,7 trillion consisting of FDI IDR1.397,7 trillion (63,2%) and DDI IDR 815,0 trillion (36,8%).
Bali & Nusa TenggaraIDR 69,4 T (3,1%)
Singapore US$ 26,4 B (26,3%)
Japan US$ 14,7 B (14,7%)
PRC US$ 7,4 B (7,4%)
Hongkong, PRC US$ 6,0 B (6,0%)
Malaysia, US$ 5,9 B (5,9%)
Others US$ 39,7 B (39,7%)
Electricity, Gas, & Water Supply IDR 234,1 T (10,6%)
Mining IDR 219,2 T (9,9%)
Metal, Machinery, & Electronic Industry IDR 211,6 T (9,6%)
Transportation, Warehouse, andTelecommunication IDR 199,6 T (9,0%)
Food Industry IDR 199,2 T (9,0%)
Others IDR 1.149,0 T (51,9%)
Investment Realization 2015 – 2018/Semester I
The Investment Coordinating Board of the Republic of Indonesia
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Investment Realization 2014 – 2018/Semester I: Based on sector
Source: BKPM, 2018 (processed)
91,8 95,1 89,3
124,7
0
50
100
150
0,0
20,0
40,0
60,0
80,0
100,0
2014 2015 2016 2017 2018/tw1
Primary Sector
DDI FDI Total
0,0
50,0
100,0
150,0
200,0
250,0
300,0
Food Industry Basic Metal,machinery &
electronic Industry
Basic Chemical &pharmaceutical
Industry
Otomative Industry Non Metal Industry
Top 5 Sub sectors – Secondary Sector
DDI FDI Total
51,316,8
151,2
47,0
202,5
63,8
0,0
50,0
100,0
150,0
200,0
250,0
300,0
Electricity, Gas &Water
Transportation,warehouse &
Telecomunication
Housing, IndustrialEstate & Offices
Construction Trading &Repairing
Hotel & Restauran
Top 6 Sub sectors – Tertiary Sector
DDI FDI Total
199,2236,0
335,3
274,8
0,0
100,0
200,0
300,0
400,0
0,0
50,0
100,0
150,0
200,0
250,0
2014 2015 2016 2017 2018/tw1
Secondary Sector
DDI FDI Total
172,4214,4
188,1
293,4
0,0
100,0
200,0
300,0
400,0
0,0
50,0
100,0
150,0
200,0
2014 2015 2016 2017 2018/tw1
Tertiary Sector
DDI FDI Total
Investment in Housing, Industrial Estate & Office Building and Hotel & Restaurant contributed significantly to investment in tertiary sector with totally 2014-2018/tw2 reach IDR 202,5 Trn and IDR 63,8 Trn respectively.
CAGR: 11.3% CAGR: 19.4%
The Investment Coordinating Board of the Republic of Indonesia
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Property subsector has contributed 24% to investment in tertiary....
Source: BKPM, 2018 (processed)
25,7
36,941,0
55,6
0,0
10,0
20,0
30,0
40,0
50,0
60,0
0,0
5,0
10,0
15,0
20,0
25,0
30,0
35,0
40,0
45,0
2014 2015 2016 2017 2018/Sem1
Housing, Industrial Estate & Office Building Sub sector
DDI FDI Total
7,2
12,113,8
19,4
0,0
5,0
10,0
15,0
20,0
25,0
0,0
2,0
4,0
6,0
8,0
10,0
12,0
14,0
16,0
2014 2015 2016 2017 2018/Sem1
Hotel & Restaurant Sub sector
DDI FDI Total
Government support in the development of economic zones (RPJMN), the obligation of industrial activities to be located in the Industrial Estate (under Industrial Law), and push the tourism sector as priority have been push-impact to investment in property sector.
Contributed 18% to total investment in tertiary sector and grew CAGR 29% in 2014-2017 period.
99% has been dominated by real estate business to be owned or leased(including industrial estate property).
Investment realization in 2017 amounted IDR 55,6 Trn or increase 36% yoy. Up to 1st Semester/2018, investment realization reached IDR 43,4 Trn (more than 2016 figure).
70% dominated by FDI in average. FDI in 1st Semester/2018 merely close to FDI in 2017 figure.
CAGR: 29.3%
Contributed 6% to total investment in tertiary sector and grew CAGR 39% in 2014-2017 period.
86% has been dominated by Star hotel, 9% by Non star hotel, and restaurant for the rest.
Investment realization in 2017 reached IDR 19,3 Trn or increase 41% yoy. Up to 1st Semester/2018, investment realization amounted IDR 11,4 Trn (merely the same to 2015 figure).
77% dominated by FDI in average. FDI in 1st Semester/2018 reached IDR 6,7 Trn (close to FDI in 2015 figure).
CAGR: 39.1%
The Investment Coordinating Board of the Republic of Indonesia
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Tourism10 Tourism Destination (“10 New Bali”)
Lifestyle Industrye.g: Creative Industry, culinary, fashion
MaritimeIncluding fishery and cold storage
InfrastructureEnergy, transportation, road, railway, airport, seaport
Manufacturing IndustryLabor intensive, Export orientation, Import substitution, and Value-added Industries
Special Economic Zone (SEZ)
Industrial Estate (IE)
Including :
Five (5) Investment Priority Sectors
The Investment Coordinating Board of the Republic of Indonesia
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Economic Zones as Strategic Location for Investment
12 SEZs
4 KPBPB/FTZ
83 IEs
10 KSPN
47 IEs Implementation location for Direct Construction Facility/KLIK (KemudahanInvestasiLangsungKonstruksi)Total Area : 14.996,85 ha
(SEZ, IE, KPBPB/FTZ, KSPN)
Jakarta
INDONESIA
(Special Economic Zone)
Total Area : 16.085,72 Ha
(Industrial Estate) large scaleTotal Area : :75.288,49 Ha
(National Tourism Strategic Zone)(KawasanPerdaganganBebasdanPelabuhanBebas/Free Trade Zone)Total Area : 127.472 Ha
The Investment Coordinating Board of the Republic of Indonesia
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Fiscal Incentives and Facility for Investment
(MoF Regulation No. 35/PMK.010/2018,BKPM Reg No 5/2018)
5-20years tax exemption*With another 50% tax exemption for additional 2 years (transitional period).
17 eligible pioneer industries: 1. Basic metal industries;2. Oil refinery industries ; 3. Petrochemical industries from oil, gas, or coal;4. Basic an-organic chemicals5. Basic an-organic chemicals from agriculture, plantation, or forestry;6. Basic material industry for pharmaceutical ;7. Semi-conductor and other computer main component industries;8. Main component industry for telecommunication;9. Main component industry for medical devices;10. Machinery industries;11. Machinery industries for automotive;12. Main component industry for robotic;13. Main component industry for marine transportation;14. Main component industry for airlane;15. Main component industry for railway;16. Electric Power Generation industries;17. Economic infrastructure.
IDR 0,5 trillion
Minimum investment plan(USD 38 million).
(Government Regulation No.9/2016)
145business fieldsEligible for tax allowance, expanded from 143 segments in the previous regulationwith additional segment: clothing industry.
30% of investment valueReduction of coIDRoratenet income tax for 6 years, 5% each year.
Under certain requirements among others:
investment value or export orientation, manpower absoption, local content, and project location (especially outside Java island).
Tax Holiday Tax Allowance
(MoF Regulation No.176/PMK.011/2009 juncto. No. 188/PMK.010/2015)
- 2 years import duty exemption or- 4 years for companies using locally-
produced machines/equipment (min.30%).
a. Machinery/equipment import duty exemption
b. Raw materials for production
Which produces goods and/or services, including:1) Tourism and culture 2) Public transportation 3) Public health services 4) Mining 5) Construction 6) Telecommunication 7) Port
Industries
Import Duty Facility
*) Based on value of investment threshold.
The Investment Coordinating Board of the Republic of Indonesia
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Perizinan Berusaha Terintegrasi Secara Elektronik (PBTSE)/Online Single Submission (OSS)
INVESTOR INTEGRASI SISTEM
OSS Implementation
Note: 1) Operate in Coordinating Ministry for Economic Affairs for 6 months2) PTSP-BKPM provide investment services for 29 licenses (exclude OSS)
The Investment Coordinating Board of the Republic of Indonesia
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The Current Implementation of Business Licensing Services
Sumber: Kemenko Perekonomian
Licenses still process through PTSP in BKPM (per 9 July 2018)
29(16 Sectors)
488(20 Sectors)
Licenses process through OSS
Electricity; Agriculture; Environmental and forestry; Public Works and Public Housing; Marine and Fisheries; Health;
Industry; Trading; Transportation; Communication and Information Technology; Finance; Tourism; Education and
culture; Employment; Police; BKPM
Electricity; Agriculture; Environmental and forestry; Public Works and Public Housing; Marine and Fisheries; Health;
Medicine and Food; Industry; Trading; Transportation; Communication and Information Technology; Finance;
Tourism; Education and culture; Higher education; Religion; Employment; Police; Micro, Small, and Medium-Scale
Enterprises and Cooperatives
Regulated in PP No. 24 Tahun 2018 Has not regulated in PP No. 24 Tahun 2018*)
Notes: The implementation of Business Licensing that is not regulated in PP 24/2018 still process based on regulation in related sector. The coordinating minister who organizes government affairs in the economic field will evaluates and reforms the regulation on business licensing as intended for a maximum of 6
(six) months after this Government Regulation is promulgated.
The Investment Coordinating Board of the Republic of Indonesia
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Investment Opportunity in Property subsector
Indonesia market opportunities (GDP USD 1 Trillion and GDP per capita USD 3.500- in 2017, 70 million middle income class)
Promote stable and sustain macro economy
Development economic zone drives the property demand in selected region
The present of agglomeration in new metropolitan city development, lack of affordable housing supply (backlog di Sumut, Jatim, Jabar, dll)
Infrastructure development in public transportation (MRT, LRT) will contribute to the development of Transit Oriented Development (TOD)
High demand for Industrial area due to a large numbers of investment in manufacturing sector
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Badan Koordinasi Penanaman Modal (BKPM)Indonesia Investment Coordinating Board
Jalan Jenderal Gatot Subroto No. 44Jakarta 12190 - Indonesia
t +62 21 525 2008 | f +62 21 525 4945 | e [email protected]
bkpm.go.id | investindonesia.go.id
Indonesia Investment Promotion Centre (IIPC)