Indonesia Investment Club (IIC) – whose members are pension funds, insurance firms, non-bank financial institutions – is looking at an investment of up to Rp10 trillion ($757.58 billion) in the country’s tourism sector in 2016. The investment is expected to boost foreign exchange reserves to $20 billion in the next five years from the current amount of $10 billion.
IIC has already launched open financing scheme such as Real Estate Investment Trusts (REITs), equity, bonds and other instruments – to help finance the projects, revealed Dumoly F Pardede, Deputy Commissioner of Non-Bank Financial Institutions of OJK,
Last year, OJK launched IIC to help boost medium and long-term investment in the country. At the end of 2015, total assets of non-bank financial institutions in Indonesia were recorded at around Rp 1,700 trillion.
IIC play a role in bridging the demand and supply side in infrastructure projects, capital market, bond market and other financial instruments. So far, most of the non-bank financial investments prefer to put their funds in bank deposits and only small parts are placed in other instruments.
Chairman of OJK Muliaman Hadad, said IIC has the capacity to invest in the financial market and infrastructure projects for up to Rp600 trillion in 2016 to 2019. Indonesia government needs investment up to Rp 5,519 trillion to develop various infrastructure projects in the next five years and half of the funds are expected to come from private sector or investors.
Minister of Tourism Arief Yahya, said that the government has already implemented a number of strategies including raising of finances from capital market and private investors, to achieve its goal of meeting the investment target for the tourism industry.
Indonesia has 10 priority tourism development area. Among them are Lake Toba in North Sumatra, Mandalika Resort in West Nusa Tenggara, Morotai in North Maluku, Tanjung Lesung in Banten, Labuan Bajo in East Nusa Tenggara, Thousand Islands in Jakarta, Wakatobi in Southeast Sulawesi, Belitung Islands, and Borobudur in Central Java and Bromo Tengger Semeru in East Java.
The Government is hoping to boost foreign tourist visits to 12 million peoples in this year from 2015’s recorded figure of 10 million visitors.
Moreover, the Government also provided a facility to the foreign tourists to enter Indonesian territory by using cruise ship or yacht. Minister of Tourism targets of 3,000 yachts will enter Indonesian territory in this year.
“We hope in 2019 there will be 5,000 yacht entering Indonesia and give us $500 million in foreign exchange,” Arief said.
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