Labor-Intensive Industry Down 12 Pct: BKPM

Jakarta (Antara Bali) - The Capital Investment Coordinating Board (BKPM) said realization of investment in the labor-intensive industry dropped 12 percent to Rp55.4 trillion in 2015 from Rp63.2 trillion in the previous year.

The decline in the labor-intensive investment realization took place amid the positive growth of investment in the national scale which rose 17.8 percent to Rp545.4 trillion.

"Investments in all sectors inclined to rise, except the investment in the labor-intensive which dropped 12 percent," BKPM Head Franky Sibarani said on Thursday.

He said that the drop of investments in the food and drink sector by 18.4 percent from Rp53.4 trillion to Rp43.trillion and the foot-ware by 20 percent from Rp2.4 trillion to Rp2 trillion were the reasons for the fall of the investment in labor-intensive sector.

The value of investments in Indonesia increased 17.8 percent to reach Rp545.4 trillion in 2015, Franky said.

Investments  surpassed the target set at Rp519.5 trillion, head of BKPM, Franky Sibarani, said.

"Realization of domestic investment reached Rp179.5 trillion, rising by 15 percent from the year before, while realization of foreign investment was up 19.2 percent to Rp365.9 trillion," he said.

Franky noted that the achievement was to be praised, in view of the current economic slowdown throughout the world.

"Investment performance remains encouraging, marked by growth that would provide multiple effects, such as on employment, investors' trust in the fundamental conditions of the Indonesian economy and politics, as well as future economic growth prospects," he said.

With regard to employment, Franky said 1,435,711 workers were hired due to investment in 2015, which was up by 0.3 percent compared to the previous year's employment of 1,430,846.

"The low absorption would be due to home work in 2016," he added.

BKPM's deputy for control of investment implementation, Azhar Lubis, added that the positive performance in 2015 was supported by rising contributions from larger investments in the fourth quarter of the year.

From October to December 2015, investments reached Rp145.4 trillion, up by 20.8 percent from the same period in 2014.

Further, domestic investment in the period was recorded at Rp46.2 trillion, up 10.2 percent, while foreign investment reached Rp99.2 trillion, up 26 percent.

"In the fourth quarter of 2015, realization of investment in Java amounted to Rp77.3 trillion, while investments outside Java reached Rp68.1 trillion. Compared with the same period in 2014, there was an increase in investments outside Java of 35.1 percent from Rp50.4 trillion," he said. (WDY)