<article>Indonesia is throwing open more sectors for 100 per cent foreign investment.</article>

Indonesia is throwing open more sectors for 100 per cent foreign investment.
After relaxing sectoral caps from fast-growing e-commerce sector late last year, Indonesia is opening seven business areas related to the tourism industry, which is expected to have a huge economic multiplier, for direct foreign investment.
These include restaurants, bars, cafes, sports-related facilities covering swimming, soccer, tennis courts and sport centres. However, two segments under tourism, travel agencies and tour guides, are reserved for domestic sector only.
The government is also evaluating the Negative Investment List (DNI) regulation and it will announce the fresh list in the first quarter this year. The last DNI ruling was issued in 2014.
Some of the sectors that could see relaxation in foreign investment caps are e-commerce, creative economy, retail, industry, health, public works and housing. Indonesia is opening up many sectors to inject momentum into its economy given limited domestic capital to spur development activities.
Indonesia <a href="http://www.bkpm.go.id/">Investment Coordinating Board</a> (BKPM) head Franky Sibarani stated the government will expand more sectors to be fully opened to boost foreign investment. “With this revision, we are trying to build a perception that Indonesia is more open. With this rule we believe the investment commitment could increase by 50 per cent from last year,&#8221; he added.
 At BKPM&#8217;s coordination meeting on Wednesday, which was focussed on the tourism sector, it was decided that seven business areas will be opened up to 100 per cent ownership to foreign investors while four will enjoy 70 per cent and 14 areas will be opened up to 67 per cent foreign ownership, Sibarani said.
Currently, the seven business areas have a sectoral cap of up to 51 per cent foreign ownerwhip.
&#8220;With the opening of 100 per cent shareholding, foreign investors can invest directly,&#8221; he said.
&#8220;This (policy) should encourage investment into the tourism sector, which is also a priority sector for BKPM,&#8221; he said.
There are 18 tourism sub-sectors that will be partly restricted to foreign ownership. Of these, the ownership in four business areas will be opened up to 70 per cent and 14 areas will be opened up to 67 per cent.
The four business areas that will be opened up to 70 per cent for foreign investors are also in line with the ASEAN Framework agreement on Services (AFAS). &#8220;The four business areas are catering services, golf course, convention services and travel exhibition (MICE) and spa. Investors still need a local partner to own 30 per cent shares in companies to engage in these sectors,&#8221; he said.
The 14 business sectors where foreign investors can own up to 67 per cent are private museums, privately managed historical remains, travel agencies as well as one-star, two-star and a non-star hotels. The other areas are accommodation service, sports arenas such as billiards, bowling, fitness, arts, karoake, as well as exploitation of tourism.
&#8220;In the current regulation, these fields of business are still closed to foreigners. They are still 100% allocated to domestic investment,&#8221; he added.
In addition, there are two business fields that are closed to the foreign investment, namely travel agencies and tour guides. &#8220;Not all will be opened. Travel agents and guides will be closed to foreigners,&#8221; he concluded.
Under the current regulations, foreign ownership in those sectors is capped at 33 per cent in Sumatra, Java and Bali, and at 67 per cent in other regions.
<h3 class="p3">Manufacturing sectors too get relief</h3>
In addition, the government also decided to allow foreign investors to own sugar and rubber manufacturing companies, as long as they are willing to use 30 per cent raw material supply from local farmers.
The warehouse business is also subject to liberalization, Franky said, but the government has yet to decide the level of foreign ownership.
The relevant ministries are now discussing a foreign ownership level of between 33 per cent and 67 per cent for the sector, he said.
President Joko Widodo has set an end-January deadline for his administration to come up with the first negative list revision.
Coordinating Minister for the Economy Darmin Nasution said earlier that the government would open up to 17 business sectors to foreigners, including transportation services, home appliance manufacturing, assisted living, cemetery services, movie theaters as well as convenience and department stores.
Indonesia also considers allowing foreigners to own cold storage businesses, sugar factories and rubber manufacturing companies in an attempt to attract more foreign investment.
Also Read : <a style="color: #ff0000;" href="http://www.dealstreetasia.com/stories/indonesia-investment-realization-in-2015-over-the-target-to-us39-24b-28019/">FDI into Indonesia rises 19% at $26b in 2015; Singapore tops inflows</a>
<a style="color: #ff0000;" href="http://www.dealstreetasia.com/stories/indonesia-to-launch-new-regulation-on-e-commerce-in-february-27115/">Indonesia to launch new regulation on e-commerce in February</a>
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Indonesia is throwing open more sectors for 100 per cent foreign investment. Indonesia is opening seven business areas related to the tourism industry.

Indonesia allows 100% foreign investment in tourism segments, to relax sectoral caps in many more industries

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Indonesia allows 100% foreign investment in tourism segments, to relax sectoral caps in many more industries

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