Meeting the Minister of Singapore, Airlangga Hartarto Discusses Two New KEKs in Batam

Editor: Lia Sisvita Dinatri

TRIBUNBATAM.id, BATAM - Two Special Economic Zones (KEK) in Batam, Nongsa Digital Park and Batam Aero Technic were discussed by the Coordinating Minister for Economic Affairs of the Republic of Indonesia, Airlangga Hartarto with the Singaporean Minister of Trade and Industry, Chan Chun Sing. 

In the virtual meeting, Airlangga said that the two KEKs could take advantage of the facilities and incentives provided by the government. 

Nongsa Digital Park is built on an area of 166,45 hectares and an investment target of IDR 16 trillion and will absorb 16,500 workers. 

Meanwhile, Batam Aero Technic has a land area of 30 hectares with an investment target of IDR 6.2 trillion and is expected to absorb 9,976 workers. 

"The two new KEKs in Batam were built to encourage economic growth in the BBK area which is directly adjacent to Singapore.

It is targeted that by December 2020, the two KEKs will be able to take advantage of the facilities and incentives provided, "said Coordinating Minister for the Economy, Airlangga Hartarto, as quoted at the Indonesia-Singapore Ministerial Meeting (PTM) online. 

In the midst of the global Covid-19 pandemic, Indonesia and Singapore are committed to continuing to strengthen and enhance bilateral economic cooperation.

This step was taken in order to encourage sustainable economic growth of the two countries.

Coordinating Minister Airlangga Hartarto together with Minister Chan Chun Sing then also agreed on a progress report on the cooperation of 6 Working Groups (Joint Report to Leaders) to be reported in the next meeting of the two Heads of Government. 

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6 Working Groups (WG) include WG Batam, Bintan, Karimun (BBK) and Special Economic Zones, WG Investments, WG Transportation, WG Tourism, WG Employment, and WG Agribusiness.

Seeing the effects of the massive pandemic and as an effort to accelerate economic recovery, the Ministers underlined several agreements that had been produced by the two countries, including the ratification of the Bilateral Investment Treaty (BIT). 

Travel Corridor Agreement (TCA), signing of the Double Taxation Avoidance Agreement (P3B), Indonesia's Structural Reform Policy through the Job Creation Law.

"Indonesia-Singapore agreed to extraordinary efforts and come up with new policy breakthroughs to ensure that the strict health protocol aspects and economic recovery can go hand in hand," he said. 

Coordinating Minister Airlangga also conveyed the importance of a number of these agreements as an effort to improve the investment climate and increase Indonesia's economic competitiveness in the region. 

The two Ministers also saw the potential for increased investment, especially in the digital economy, smart cities, financial technology and digital technology-oriented start-ups.

Indonesia can learn from other countries that have made further progress in this area.

So that one of the important areas of cooperation being developed by the two countries is related to the digital economy and training of young talents in the technology sector. 

According to Airlangga, in 2019 Singapore was the third largest trading partner for Indonesia and Indonesia was the sixth largest trading partner for Singapore.

In terms of investment, Singapore was the main source of Foreign Direct Investment (FDI) for Indonesia during the 2014-2019 period with a total investment of USD 6.5 billion in 2019.

In the tourism sector, there were 1.61 million Singaporean tourists visiting Indonesia in 2019. 

In the midst of a downward trend in the economy and the global crisis due to the Covid-19 pandemic, there is a growth in the value of investment coming from Singapore to Indonesia. 

As of the second quarter (Q2) 2020, there was an increase in investment value of 36.19% (4.67 billion USD) compared to the same period in 2019 (3.43 billion USD). 

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Meanwhile, from the trade side, it is true that the economic slowdown has occurred, both globally and regionally. 

By limiting the mobility of people, tourism is a sector that is negatively affected.

As of June 2020, it was recorded that 267,676 people entered Indonesia from Singapore.

This number has decreased by 70.9% compared to the same period in 2019 of 919,863 people. 

"This meeting was held during the Covid-19 pandemic, so the implementation was done virtually.

However, this does not reduce the importance and strategic value of bilateral cooperation between the two countries, particularly in the economic sector related to the acceleration of post-pandemic economic recovery, "said Airlangga.

(Tribunbatam.id/Rebekha Ashari Diana Putri) 

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