Attraction Strategy TRAINING EXERCISES Crowne Plaza Hotel, Jakarta - PowerPoint PPT Presentation

1 Workshop on Strengthening BKPM’s FDI Attraction Strategy TRAINING EXERCISES Crowne Plaza Hotel, Jakarta May 8, 2018 Workshop facilitated by: Data ¦ Technology ¦ Consulting TPSA program is executed by www.wavteq.com | www.incentivesmonitor.com | www.fdiprofessionals.com | www.fdiaccounting.com company/wavteq @wavteq www.wavteq.com 1

2 SESSION 1: WHAT IS AN INVESTMENT PROMOTION STRATEGY (IPS)? 9:30-10:15 www.wavteq.com

Group brainstorm – BKPM’s FDI strategy 3 WHAT IS AN INVESTMENT PROMOTION STRATEGY (IPS)? 1. Why attract FDI / objectives in attracting FDI? 2. What type of FDI is BPKM is trying to attract? 3. How much FDI does BKPM want to attract? www.wavteq.com

4 SESSION 2: WHAT SECTORS SHOULD BKPM TARGET FOR FDI? 10:15-11:15 www.wavteq.com

Exercise handout – sector information 5 WHAT SECTORS SHOULD BKPM TARGET FOR FDI? Please see the below handouts providing sector data to help identify sectors to target for FDI into Indonesia 1. Inward FDI flows to Indonesia by sector (BKPM data – covers all types of FDI) 2. Inward FDI projects, jobs and capital investment into Indonesia by cluster, sectors, subsector and activity (FT data – covers greenfield FDI only) 3. Indonesia top export sectors (ITC data) 4. Indonesia top import sectors (ITC data) 5. Global FDI flows by sector (UNCTAD data – covers all types of FDI) 6. ASEAN inward FDI projects, jobs and capital investment by cluster, sectors, subsector and activity (FT data – covers greenfield FDI only) Please take 20 minutes to look through the handouts www.wavteq.com

Group brainstorm – what sectors to target for FDI? 6 WHAT SECTORS SHOULD BKPM TARGET FOR FDI? What should be the key sectors (and subsectors) to target for FDI into Indonesia? 1. . 2. . 3. . 4. . 5. . 6. . 7. . 8. . 9. . 10. . www.wavteq.com

FDI in Indonesia by sector – BKPM data 7 2014 2015 2016 Q1 2017 Q2 2017 S E K T O R / S e c t o r P I P I P I P I P I SEKTOR PRIMER / Primary Sector 977 6,991.3 1,934 6,236.4 2,313 4,502 565 1,648.9 791 1,502.3 Tanaman Pangan & Perkebunan / Food Crops & Plantation 324 2,206.7 606 2,072.0 800 1,589.1 228 450.1 273 401.9 Peternakan / Livestock 26 30.8 98 75.1 150 48.9 56 15.3 71 68.4 Kehutanan / Forestry 28 53.3 79 19.0 108 78.2 24 13.7 36 22.1 Perikanan / Fishery 47 35.3 85 53.1 125 43.3 25 4.3 58 3.6 Pertambangan / Mining 552 4,665.1 1,066 4,017.2 1,130 2,742.4 232 1,165.4 353 1,006.3 SEKTOR SEKUNDER / Secondary Sector 3,075 13,019.3 7,184 11,763.1 9,564 16,687.6 1,503 3,234.5 4,307 3,830.7 Industri Makanan / Food Industry 640 3,139.6 1,306 1,521.2 1,948 2,115.0 416 476.3 787 705.3 Industri Tekstil / Textile Industry 285 422.5 670 433.4 886 321.3 83 108.3 411 76.1 Ind. Barang Dari Kulit & Alas Kaki / Leather Goods & Footwear Industry 102 210.7 243 161.6 279 144.4 27 146.6 136 40.5 Industri Kayu / Wood Industry 61 63.7 118 47.1 240 267.5 34 11.9 130 100.6 Ind. Kertas dan Percetakan/ Paper and Printing Industry 87 706.5 210 706.9 274 2,786.6 51 116.0 132 283.9 Ind. Kimia dan Farmasi / Chemical and Pharmaceutical Industry Page 1 377 2,323.4 856 1,955.7 1,096 2,889.1 178 484.7 560 798.9 Ind. Karet dan Plastik / Rubber and Plastic Industry 255 543.9 567 694.5 710 737.3 95 295.1 350 137.3 Ind. Mineral Non Logam / Non Metallic Mineral Industry 104 916.9 277 1,302.8 397 1,076.0 90 232.0 143 62.7 Ind. Logam, Mesin & Elektronik / Metal, Machinery & Electronic Industry 690 2,471.9 1,781 3,092.5 2,185 3,897.1 287 838.2 944 1,131.2 Ind. Instru. Kedokteran, Presisi & Optik & Jam/ Medical Preci. & Optical Instru, 11 7.2 13 6.9 22 8.8 3 0.2 13 1.7 Watches & Clock Industry Ind. Kendaraan Bermotor & Alat Transportasi Lain /Motor Vehicles & Other 295 2,061.3 758 1,757.3 928 2,369.3 152 503.5 418 438.0 Transport Equip. Industry Industri Lainnya / Other Industry 168 151.8 385 83.2 599 75.2 87 21.7 283 54.4 SEKTOR TERSIER / Tertiary Sector 4,833 8,519.2 8,620 11,276.5 13,451 7,774.6 2,732 2,410.3 7,612 2,926.8 Listrik, Gas dan Air / Electricity, Gas & Water Supply 118 1,248.8 350 3,028.9 748 2,139.6 258 706.8 285 989.6 Konstruksi / Construction 147 1,383.6 358 954.5 437 186.9 61 6.8 232 74.9 Perdagangan & Reparasi / Trade & Repair 2,339 866.8 3,705 625.1 5,541 670.4 962 166.6 3,356 437.1 Hotel & Restoran / Hotel & Restaurant 407 513.1 1,052 650.2 2,028 887.8 481 394.9 1,019 301.5 Transportasi, Gudang & Komunikasi/ Transport, Storage & Communication 228 3,000.9 493 3,289.9 620 750.2 134 179.7 347 236.4 Perumahan, Kawasan Ind & Perkantoran/ Real Estate, Ind. Estate & Business 255 1,168.4 858 2,433.6 1,151 2,321.5 302 779.9 417 393.7 Activities Jasa Lainnya / Other Services 1,339 337.5 1,804 294.3 2,926 818.2 534 175.7 1,956 493.7 JUMLAH / Total 8,885 28,529.7 17,738 29,275.9 25,328 28,964.1 4,800 7,293.7 12,710 8,259.7 www.wavteq.com

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Industry Sector 2014 2015 2016 2017 2018 Total Software & IT services 17 11 11 19 2 60 9 Food & Tobacco 10 21 5 7 1 44 Business Services 10 10 8 11 2 41 Consumer Products 14 10 2 11 1 38 Real Estate 9 8 13 4 3 37 Financial Services 13 11 5 3 1 33 Top sectors by Metals 13 7 6 3 1 30 Industrial Machinery, Equip. & Tools 8 6 5 10 29 number of Communications 8 12 5 3 1 29 Greenfield FDI Chemicals 9 8 5 5 1 28 Transportation 10 6 7 4 27 projects in Coal, Oil and Natural Gas 4 12 7 2 25 Hotels & Tourism 3 4 5 2 7 21 Indonesia Textiles 3 6 5 5 19 Electronic Components 2 8 1 4 1 16 (2014-March 2018) Alternative/Renewable energy 1 5 6 2 2 16 Automotive Components 6 4 3 2 15 Automotive OEM 4 1 1 6 12 Beverages 3 6 2 1 12 Building & Construction Materials 6 1 1 1 9 Source: fDi Consumer Electronics 4 2 3 9 Markets, FT Plastics 2 1 4 2 9 Warehousing & Storage 2 2 3 1 1 9 Business Machines & Equipment 2 2 3 7 Pharmaceuticals 2 1 2 1 6 Rubber 2 2 1 5 Non-Automotive Transport OEM 3 2 5 Ceramics & Glass 3 1 1 5 Aerospace 1 1 2 1 5 Healthcare 3 1 4 Wood Products 1 3 4 Leisure & Entertainment 1 1 2 Medical Devices 1 1 2 Paper, Printing & Packaging 1 1 Minerals 1 1 Semiconductors 1 1 Space & Defence 1 1 Biotechnology 1 1 www.wavteq.com Total 177 173 119 120 29 618

Indonesia Myanmar Philippines Singapore Cambodia (Burma) Vietnam Malaysia Thailand Brunei Total Laos Destination Countries 10 Software publishers, except video games 33 272 16 46 20 34 2 2 425 Freight/Distribution Services 23 35 48 33 24 11 32 14 2 222 Cosmetics, perfume, personal care & household products 19 25 18 7 16 5 3 3 1 97 Internet publishing & broadcasting & web search 18 76 9 17 10 19 149 Advertising, PR, & related 18 72 9 9 11 11 3 1 134 Top subsectors by Retail banking 15 27 42 27 9 30 26 23 19 1 219 Paints, coatings, additives & adhesives 15 39 11 12 21 7 7 3 115 number of Accommodation 15 7 9 12 4 5 1 53 Residential building construction 12 9 22 10 19 7 2 4 1 86 Greenfield FDI Insurance 11 31 55 19 7 22 13 7 1 166 Soft drinks & ice 11 2 3 5 3 1 3 1 29 projects in Clothing & clothing accessories 10 66 44 37 21 21 10 5 1 215 Communications equipment 10 17 11 20 13 8 4 4 87 Indonesia Automobiles 10 1 11 9 16 8 3 1 1 60 Industrial building construction 10 4 24 3 4 1 5 5 56 (2014-March 2018) Fossil fuel electric power 10 7 1 3 2 7 1 31 Professional, scientific & technical services 9 58 16 10 7 13 5 1 1 120 General purpose machinery 9 24 15 19 18 8 5 1 3 102 Data processing, hosting, & related services 9 41 4 8 9 4 5 1 1 82 Basic chemicals 9 10 6 10 11 6 3 2 57 Source: fDi Markets, Corporate & investment banking 7 52 16 15 8 15 11 6 4 1 135 Commercial & institutional building construction 7 6 32 17 9 6 8 5 3 93 FT Warehousing & storage 7 8 8 7 7 5 3 2 1 48 Steel products 7 5 12 2 10 4 3 1 44 Agriculture, construction, & mining machinery 7 5 6 4 4 3 4 1 1 35 Sugar & confectionary products 7 6 3 2 1 1 20 Custom computer programming services 6 33 18 11 1 15 1 85 Pharmaceutical preparations 6 26 9 8 4 5 3 61 Animal food 6 1 34 1 3 2 5 52 Other motor vehicle parts 6 2 13 8 19 2 50 Travel arrangement & reservation services 6 12 5 3 7 7 2 42 Furniture, homeware & related products 6 5 12 7 5 4 1 1 41 All other electrical equipment & components 5 13 46 21 13 10 2 2 1 113 Rental & leasing services 5 26 7 3 6 33 2 4 1 1 88 Computer & peripheral equipment 5 15 12 8 9 9 1 2 61 Food & Beverage Stores 5 4 8 8 10 4 1 1 41 Plastics packaging materials & unlaminated film & sheets 5 5 11 5 6 4 2 38 Cement & concrete products 5 3 4 1 6 9 4 1 33 Aircraft 5 16 1 7 4 33 Alumina & aluminium production and processing 5 2 4 4 9 4 28 Biomass power 5 1 6 3 4 2 2 2 1 26 Grains & oilseed 5 1 4 2 1 6 4 3 26 www.wavteq.com Motor vehicle electrical & electronic equipment 5 5 4 5 2 21