Indonesia Investment Realization Q3 - 2023

The realization of Indonesian investment in the third quarter of 2023 experienced a sharp increase. During the period, it reached IDR 374.4 trillion, indicating a rise of 7.0% from the last quarter and 21.6% from the last year of the same quarter. With the attainment in the third quarter, the realization of investment has reached 1,053.1 billion rupiah out of the target set by the President that aimed to reach 1,400 trillion rupiah. This amount represented 75.2% from that target. While in terms of the Strategic Plan Target that projected a total amount of 1,099.8 trillion rupiah, it reached 95.7% of the target. Further, such increment was accompanied by the 516.467 labor absorption with the proportion of domestic and foreign absorption of 66.7% and 33.3% respectively in the third quarter of 2023.

Of the IDR 374.4 trillion, 52.4% was contributed by foreign investment with a total value of 196.2 trillion rupiah. Domestic investment put up 47.6% that accounted for 178.2 trillion rupiah. Both domestic and foreign sectors showed an increment compared to the previous year with 28.2% and 16.2% respectively. In the context of location spread, an almost balanced proportion between Java Island and outside Java Island was indicated in the third quarter of 2023. A proportion of 49% of investment realization was situated in Java Island while the remaining 51% was brought to fruition outside Java Island.

The top five main sectors of the investment realization in the third quarter of 2023 were: 1) Basic metal, metal goods, non-machine and equipment industry with 56.9 trillion; 2) Mining with 41.9%; 3) Transportation, warehouse, and telecommunication with 40.9 trillion; 4) Chemical industries and Pharmacy with 28.7 trillion; 5) Housing, industrial, and office area with 25.5 trillion. For the foreign direct investment (FDI), the highest realization was in the sector of Basic metal industry, non-machine metal commodities, and the associated tools which accounted for almost a quarter of the total FDI realization. This was followed by chemical industry and pharmacy with 10.1% and mining with 10%. As for the domestic direct investment realization (DDI), transportation, warehouse, and telecommunication had the highest realization with 13.9% followed by mining with 12.5% and housing, industrial area, and office complex with 9.3%.

In terms of provincial distribution of investment realization in the third quarter of 2023, Special Territory of Jakarta took the top spot with a total value of 50.9 trillion rupiah. West Java, East Java, Banten, and North Maluku came after with 49.5 trillion rupiah, 38.9 trillion rupiah, 28 trillion rupiah, and 27.8 trillion rupiah. For FDI realization, West Java and Central Sulawesi took the top spot with US$ 1,8 Billion followed by North Maluku (US$ 1,8 Billion), Banten (US$ 1.2 Billion), and Special Territory of Jakarta (US$ 1.1 Billion) in sequence. For DDI realization, Special Territory of Jakarta covered almost a fifth of the total DDI realization in Indonesia with 34.2 trillion rupiah. This made the province had the highest DDI investment realization in Indonesia during the period. It was followed by East Java (22.7 trillion rupiah), West Java (22.6 trillion rupiah), East Kalimantan (13.8 trillion rupiah), and Banten (10.1 trillion rupiah).

In terms of investment realization by sector in the third quarter of 2023, the secondary sector, which was mainly contributed by manufacturing, rendered the biggest contribution with 163.7 trillion rupiah. This represented 43.7% of the total investment value. Tertiary sector came afterward with 143 trillion rupiah (38.2%) followed by the primary sector with 18.1% that was equivalent to 67.7 trillion rupiah. For DDI realization, the tertiary sector dominated the proportion with 51.8%. While for FDI realization, it was the secondary sector that largely contributed with almost 60%.

Further, Indonesia has been doing relentless efforts in being part of the top five countries and regions with the highest investment realization, which was occupied by Singapore, China, Hongkong, Japan, and USA in the third quarter of 2023. In fact, the achievement of Indonesia in the third quarter of 2023 was a mark for a robust development in the forthcoming years.