Foreign Investors Needed to Cover the Capital Shortage

To achieve the target of 7.6 per cents economic growth in 2014, Indonesia needed the investment of 40 per cents of Gross Domestic Product (GDP). Unfortunately, at the moment Indonesia only had the savings of 33 per cents of GDP. It was said by the Head of the Investment Coordinating Board (BKPM), Dr.Chatib Basri, in the Public Lecture organized by the Regional Development Master Student, Monday (15/4) in the Campus of IPB Darmaga. He said, this had not been sufficient and could not be achieved without the foreign investment.  “The difference of 7 per cents capital requirement is very large and quite causes the economic instability,” said Dr. Chatib.

 

Further Dr.Chatib outlined the investment needed to drive the wheels of economic activity and kept the revenue or income of community. Moreover, Indonesia’s population was now dominated by the productive age which consumption level was higher than old age. “For European and American capitalists, the population of Indonesia which is dominated by the productive age is very beneficial, of course with the socio-political condition which is stable. The number of productive people means cheap labor and potential consumer as well. At the productive age, the Indonesian middle class will buy a house, car, and many other consumer goods,” he explained. To increase the number of productive middle class, a country seemed from the dietary changes was more concerned with the prestige, the increase in private car ownership which was causing the congestion on the roads, and the demand for property increased.

 

Rector of IPB, Prof.Dr.Ir. Herry Suhardiyanto, in his speech conveyed his hope that the national agriculture was managed optimally and contributed to higher GDP. “During this time the agriculture is worked on the medium scale and less ogled by the investors, whereas insufficient food availability causes the crisis,” he added. (ris)