Foreign investors have shown strong interest in the downstream oil and gas business in Indonesia. A leading Hong Kong-based company recently announced its interest in investing in the filling station business in Southeast Asia’s largest economy.
The company’s investment interest was expressed during a business forum event that featured the Head of the Investment Coordinating Board (BKPM) Franky Sibarani as keynote speaker to 40 Hong Kong multi-sector investors, Wednesday (18/5). Franky said the investoris engaged in the trading of petrol, diesel, jet fuel and LPG in Hong Kong and overseas, and has business capability in the downstream oil and gas sector.
Currently, the investor owns 42 petrol stations and two oil terminals with a storage capacity of 374,500 cubic metres. It also has a fleet of 16 vesselswith the capacity to transport 68,600 tons of oil. In addition, the company has a marketing network that covers almost the whole of Hong Kong.
Franky added that the investor had visited Indonesia a number of times. They had met with Pertamina to share their investment plans in the general commercial fuel business in Indonesia. To ensure the plan goes ahead, a designated BKPM marketing team in Hong Kong will oversee the investment interest.
BKPM has also received expressions of interest from other Hong Kong companies in investing in the infrastructure, maritime and fisheries sectors. “In fact there is one company operating in the electronics and property industries that will increase its investment in Sukabumi by US$ 5 million,” said Franky in a BKPM press release on Thursday (19/5).
Franky hopes that in the future more Hong Kong companies will invest in Indonesia. He believes that as an investment destination, Indonesia has several competitive advantages,particularly its rich natural resources such as agricultural and mining commodities, including renewable energy sources.
The government also has several infrastructure projects to promote investment and enhance the competitiveness of investment opportunities. These include 15 new airports, 163 ports, the 35 GW power project, and construction of 2,024miles of railway track and 621 miles of toll road and sea routes.
BKPM has reformed its investment services by introducing One Stop Services and a 3-hour investment permit service, and easing direct investment in construction, as well as earmarking priority sectors for investment, which includes plans to develop 11 neweconomic zones and 20 National Strategic Tourism Areas.
Franky added that Hong Kong is one of Indonesia’s main investment partners. Between 2010 and 2015, BKPM recorded actual investment from Hong Kong of US$ 3 billion. In the first quarter of 2016, actual investment from Hong Kong amounted to US$ 456 million, a significant increase on the US$ 75 million recorded the same period last year. The most popular sectors for Hong Kong investors were property including industrial estates, transport, warehousing and telecommunications.