JAKARTA – The government has a positive outlook on investments for 2013. "The government is optimistic that there'll be as much as $30 billion in investments next year," said Minister for the Industry Mohamad Suleman Hidayat Monday. Hidayat said the huge investments will be in crude oil processing plants in Tuban, East Java and in Balongan, West Java. For the construction of the two refineries Pertamina will be working with Saudi Arabia and Kuwait oil companies. "The one in Balongan is with Kuwait and in Tuban with Aramco, Saudi Arabia. But it is likely it will be moved to Bontang (East Kalimantan) because Pertamina has land and facilities there," he said. The investment value of one refinery is $10 billion. "So, for the construction of two refineries, we'll receive an investment of $20 billion," he said. The factories will produce up to 600 thousand barrels of oil per day. Once it they are in operation, the two oil refineries will reduce the current fuel subsidies of $14 billion per year. "If they're completed this year, the investments will start in 2013," Hidayat said. Construction will begin as soon as the Ministry of Finance has given its seal of approval. Another big investment entering Indonesia, says the Minister, will be from Honam Petrochemical Corporation. It will invest $5 billion to build a petrochemical plant in Indonesia. With the construction of the plant Indonesia's annual petrochemical imports worth $6 billion can be reduced. "We've calculated it, within four to five years we can reduce our petrochemical imports," he said, adding that he is in the process of discussing tax holidays for 10 years to Honam. Another investment is by Taiwan-based Foxconn Technology, which is already preparing to construct its factory worth $5 billion. It should start operating in the middle of 2013. "So, as far as big investments are concerned, I'm optimistic that next year's target can be achieved," he said. The Director General of International Cooperation, Ministry of Industry, Industrial, Agus Tjahajana, said Indonesia is now in dire need of refined oil products. Therefore, the construction of two refineries are necessary to boost the domestic industry. "Look at our trade balance, the minus is horrifying." Overall, Agus said the total investments of $30 billion can be realized within a period of two years. "The most realistic, within two years the investments can already be felt," he said. Even so, they will try to make the investments a reality as soon as possible, he added. – Agencies
