"The two investment sectors are still good."
Jakarta (ANTARA News) - The former head of the Investment Coordinating Board (BKPM), Gita Wirjawan, said he was optimistic investment could grow above 20 percent during the second quarter of this year.

"I think realization of investment in the second quarter could be above 20 percent," he said after handing over his post as head of BKPM to Muhammad Chatib Basri here on Thursday.

Gita turned over the post of BKPM chief, which he continued to hold following his appointment as trade minister on October 19.

"I believe in Chatib Basri, who is not only an economist but also a credible person at home and abroad and, therefore, could follow up and even improve the programs we have made before," he said.

Gita said Indonesia has created the momentum to encourage investment in the country.

"The momentum is there. The second and third quarters will be positive despite current economic uncertainty in the world, as long as our policies remain sensible," he said.

In the first quarter, foreign investments were recorded at Rp51.5 trillion, while domestic investments were Rp19.7 trillion.

Total investments during the first quarter of 2012 reached Rp71.2 trillion, up 32 percent from the same period last year, which was recorded at only Rp53.6 trillion or up 1.5 percent from the fourth quarter of 2011 at Rp70.2 trillion.

BKPM has set a target of inviting up to Rp283.5 trillion in investment, consisting of Rp206.8 trillion in foreign investment and Rp76,7 trillion in domestic investments.

Regarding trade policies to deal with the impact of the current crisis in Europe and the US, Gita said the government would focus on increasing the value of products and not the volume.

"Focusing on products with added value could multiply benefits, compared to that of selling raw materials. In addition to that, there are also traditional markets where Indonesia still has no official representatives," he said.

Gita is also optimistic that in the next 18 months Indonesia could increase exports of added-value products.

The new BKPM chief, Chatib Basri, however, was still reluctant to mention growth figures, saying only that "in the first quarter investment has grown 30 percent. It seems there is no problem. However, we cannot use the assumption since I still have yet to see the second quarter figures."

He said investment in Indonesia was still focused on two sectors, mining and warehousing.

"The two investment sectors are still good, as profits from them are still huge, but the manufacturing sector is posing a problem because our competitiveness in the sector is still relatively limited," he said.

He added that the first step he would take as the new BKPM chief is promoting investment in Indonesia and making preparations to accommodate foreign investors` needs in the country.

Chatib Basri, born in Jakarta on August 22, 1965, started his career as a researcher at state University of Indonesia in 1992 and worked at a number of universities abroad.

He was a special staff member for the finance minister from 2006-2010, member of the Capital Investment Committee on Economy at BKPM from 2007 to 2008, Indonesia`s sherpa for G-20 in 2008 and finance minister`s deputy for G-20 from 2006-2010.
(T.D017/H-YH/INE/KR-BSR/S012)

Editor: Priyambodo RH
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