Foreign Investment In Indonesia Essay

1102 words - 5 pages

Foreign Investment in Indonesia

Towards the era of liberalization, trade and foreign investment began to discuss. It is considering that for the sustainability of national development is needs more funds. Funds that needed for economic development cannot be satisfied only from the national government and private investment. Therefore, to cover the shortage of funds in the country, it needed foreign investment.
Foreign investment, particularly in countries that are developing, including in Indonesia is intended for business development and to explore the potential of getting an economic power by using the potential of capital, skills, and technology that brought by foreign investors to accelerate the economic development of the developing countries as long as it does not lead to continued dependence and does not harm the national interest.
In Indonesia, foreign investment although it already existed in a few decades but it remains as the controversial one. There are rarely criticisms about development that is not associated with the foreign investment. There is an accusation say that foreign investment has aggravated Indonesia's dependence against foreign. Foreign investment has been pressing indigenous entrepreneurs, do not put labor in its place and only a few contribute in new technologies and capital.
But it must also be recognized that until now, Indonesia is still requires the existence of a transfer of technology and the transfer of skills that can only be achieved through foreign investment inflows into Indonesia. By allowing the entry of foreign capital into Indonesia, besides being complementary of domestic factors of production, foreign investment should be directed according to the areas that have been prioritized by the government.
To support investment in Indonesia, the government should support to create a good investment environment. Foreign investment is an important instrument for national development and its expected to create certainty for the foreign investors to enhance and continue its commitment to invest in Indonesia. Public participation and the legal apparatus are indispensable in attracting investors by way of creating conducive environment for investing.
There is a reciprocal flow into other countries like Japan from Indonesia. Japan is a major trading partner of Indonesia as an export destination and import source. Indonesian export products include: oil and gas and non-oil products such as plywood, electrical machinery, nickel, fishery products, natural rubber, paper and paper products, textiles and textile products, furniture, coffee, chocolate and tea.
Meanwhile the main import products from Japan to Indonesia are capital goods that related to investment activities and needs of domestic industries such as machinery, electronic equipment, vehicle parts, iron and steel, plastics, chemicals, and metal products. Beside the huge market of Indonesia, Indonesia also has another attraction for Japanese investment like...

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