Japanese food firms to invest up to $1b in Indonesia

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indonesia food productionSome 20 Japanese food and beverage companies plan to invest a combined total of between $400 million and $1 billion in Indonesia, an Indonesian government official said on June 9.

Panggah Susanto, director general of agriculture and chemical industries, said the plan was revealed in a research document from the Japan International Cooperation Agency, or JICA.

He said the report listed some prospective sectors for Japanese investment. However, even though it mentioned a total investment estimate from the 20 companies, it did not name them.

“I am monitoring this. They’re mostly medium-scale players. They want to manufacture with domestic raw materials, which is more competitive than if they were to import them from Japan,” he said.

Panggah said the companies were still focusing their investment in Java, mostly due to the better infrastructure facilities compared with other regions.

Contacted separately, Adhi S. Lukman, the chairman of the Indonesian Food and Beverage Industry Association (GAPMMI), said he was aware that some executive from Japanese food seasoning companies planned to come to Indonesia.

“They don’t want their names to be revealed yet, but it’s true: there are 20 companies stated in the investment plan,” Adhi said.

He said these Japanese companies were not deterred by local rises in electricity prices, and were likely to establish joint ventures with Indonesian partners.

“They believe the Indonesian market remains a good prospect for doing business,” Adhi said.

He said the Japanese government had been pushing the country’s industries to expand overseas, as the ageing market in Japan was stagnant. Furthermore, the recent hike in the sales tax there has also squeezed margins.

“From the point of view of political stability and resource availability, Indonesia is the most interesting destination in [Southeast Asia],” Adhi said.

GAPMMI estimated sales turnover in Indonesia’s food and beverage industry at 789.7 trillion rupiah ($66.9 billion) this year, up from 745 trillion rupiah last year.

Yoshinori Katori, the Japanese ambassador to Indonesia, said Indonesia’s stable economic growth was one of the most attractive factors for investors.

He also said that Indonesia’s democracy was maturing and he was not worried about the outcome of the election.

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Reading Time: 2 minutes

Some 20 Japanese food and beverage companies plan to invest a combined total of between $400 million and $1 billion in Indonesia, an Indonesian government official said on June 9.

Reading Time: 2 minutes

indonesia food productionSome 20 Japanese food and beverage companies plan to invest a combined total of between $400 million and $1 billion in Indonesia, an Indonesian government official said on June 9.

Panggah Susanto, director general of agriculture and chemical industries, said the plan was revealed in a research document from the Japan International Cooperation Agency, or JICA.

He said the report listed some prospective sectors for Japanese investment. However, even though it mentioned a total investment estimate from the 20 companies, it did not name them.

“I am monitoring this. They’re mostly medium-scale players. They want to manufacture with domestic raw materials, which is more competitive than if they were to import them from Japan,” he said.

Panggah said the companies were still focusing their investment in Java, mostly due to the better infrastructure facilities compared with other regions.

Contacted separately, Adhi S. Lukman, the chairman of the Indonesian Food and Beverage Industry Association (GAPMMI), said he was aware that some executive from Japanese food seasoning companies planned to come to Indonesia.

“They don’t want their names to be revealed yet, but it’s true: there are 20 companies stated in the investment plan,” Adhi said.

He said these Japanese companies were not deterred by local rises in electricity prices, and were likely to establish joint ventures with Indonesian partners.

“They believe the Indonesian market remains a good prospect for doing business,” Adhi said.

He said the Japanese government had been pushing the country’s industries to expand overseas, as the ageing market in Japan was stagnant. Furthermore, the recent hike in the sales tax there has also squeezed margins.

“From the point of view of political stability and resource availability, Indonesia is the most interesting destination in [Southeast Asia],” Adhi said.

GAPMMI estimated sales turnover in Indonesia’s food and beverage industry at 789.7 trillion rupiah ($66.9 billion) this year, up from 745 trillion rupiah last year.

Yoshinori Katori, the Japanese ambassador to Indonesia, said Indonesia’s stable economic growth was one of the most attractive factors for investors.

He also said that Indonesia’s democracy was maturing and he was not worried about the outcome of the election.

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