INDONESIA NICKEL

SUMMIT 2022
July 21th, 2022
Development of Indonesia's Investment Realization
(Excluding Upstream Oil and Gas, and Financial Services Sector)
2021 y-o-y 2022 (until March) y-o-y
FDI 10% FDI 31.8%
DDI 8.1% DDI 25.1%

Total 9.0% Investment Realization Investment Realization

Total 28.5%
Jan – Dec 2021 Jan – March 2022
Rp 901.0 T Rp 282.4 T
100,1% 23,5 %
Investment Target 2021
Investment Target 2022
Rp 900 T JOBS CREATED JOBS CREATED
Rp 1,200 T
1.207.893 319,013
Investment Sources Distribution Investment Sources Distribution
DDI FDI Outside Java Java DDI FDI Outside Java Java
Rp 447.0 T Rp 454,0 T Rp 468.2 T Rp 432.8 T Rp 135.2 T Rp 147.2 T Rp 148,7 T (52,7%) Rp 133,7 T
(49.6%) (50,4 %) (52.0%) (48.0 %) (47,9%) (52,1%) (47,3%)

Source: Ministry of Investment/BKPM, 2022

TOP 5 INVESTMENT REALIZATION
JANUARY – MARCH 2022
Based on Sector

FDI DDI
1. Metal, Metal Goods, Except Rp 37.3 T 1. Transportation, Warehouse, and Rp 27.0 T
(25.1%)
Machinery, and Equipment Industry Telecommunication (19.9 %)

2. Mining Rp 17.2 T (11.4%) 2. Mining Rp 18.4 T

(13.6 %)

3. Electricity, Gas, and Water 3. Housing, Industrial Estate, Rp 17.5 T

Rp 14.4 T (9.6%)
Supply and Office Building (12.9 %)

4. Transportation, Warehouse, Rp 12.9 T (8.5%) 4. Food Crops, Plantations, Rp 10.1 T

and Telecommunication and Livestock (7.5%)

5. Chemical and Rp 11.5 T (8.3%) 5. Food Industry Rp 9.7 T

Pharmaceutical Industry (7.2%)

Source: Ministry of Investment/BKPM, 2022

INVESTMENT REALIZATION
Based on Country of Origin

JANUARY – MARCH 2022

1 Singapore
US$ 3,6 M
(34,8%)

2 Hongkong, PRC
US$ 1,5 M
(15,0%)

3 People’s Republic of China (PRC)

US$ 1,4 M
(13,2%)

4 Japan
R.R. Tiongkok
US$ 0,8 M
(8,0%)

United States of
5 America
US$ 0,6 M
(6,1%)

Source: Ministry of Investment/BKPM, 2022

TREND BASED ON LOCATIONS
Year 2019, 2020, and 2021

2019 2020 2021

Investment Investment % Investment %
No. Location Total % No. Total % No. Wilayah Total %
(Rp T) (Rp T) YoY (Rp T) YoY

1 Java 434.6 53.7% 1 Java 408.8 49.5% -5.9% 1 Java 432,8 48.0% 5.9%

2 Sumatra 154.3 19.1% 2 Sumatra 200.7 24.3% 30.1% 2 Sumatra 185,3 20.6% -7.7%

3 Kalimantan 84.7 10.5% 3 Sulawesi 71.8 8.7% -6.4% 3 Sulawesi 95,8 10.6% 33.4%

4 Sulawesi 76.7 9.5% 4 Kalimantan 68.8 8.3% -18.7% 4 Kalimantan 85,9 9.5% 24.8%

Bali and Nusa 5 Maluku 38.4 4.6% 131.3% 5 Maluku 47,0 5.2% 22.4%
5 27.0 3.3%
Tenggara
Bali and Bali and
6 Maluku 16.6 2.0% 6 Nusa 24.8 3.0% -8.3% 6 Nusa 30,5 3.4% 23.1%
Tenggara Tenggara
7 Papua 15.8 1.9% 7 Papua 13.0 1.6% -17.7% 7 Papua 23,8 2.6% 83.1%

Total 809.6 100% Total 826.3 100% 2.1% Total 901,0 100% 9.0%

• Since 2020 Sulawesi has succeeded in shifting Kalimantan to rank 3, while Maluku has succeeded in shifting Bali and Nusa
Tenggara in 5th place. This still persists today.
• Maluku experienced the most significant increase since 2020 compared to other regions, where in 2020 it grew by 131.3% and
in 2021 it grew by 22.4%.
• In 2021, Papua was the region that experienced the most significant increase, where investment grew by 83.1% compared to
2020.
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Source: Ministry of Investment/BKPM, 2022
TREND BASED ON SECTORS
Year 2019, 2020, and 2021

2019 2020 2021

No Sectors Rp (T) % No Sectors Rp (T) % No Sectors Rp (T) %
Transportation, Transportation, Metal, Metal Goods, Except
1. Warehouse, and 139.0 17.2% 1. Warehouse, and 144.8 17.5% 1. Machinery, and Equipment 117.5 13.0%
Telecommunication Telecommunication Industry
Electricity, Gas, and Electricity, Gas, and Water
2. 126.0 15.6% 2. 102.0 12.3%
Water Supply Supply Housing, Industrial Estate,
2. 117.4 13.0%
and Office Building
Housing, Industrial Metal, Metal Goods,
3. Estate, 71.1 8.8% 3. Except Machinery, and 94.8 11.5% Transportation, Warehouse,
and Office Building Equipment Industry 3. 107.4 11.9%
and Telecommunication
Metal, Metal Goods, Electricity, Gas, and Water
Housing, Industrial Estate, 4. 81.6 9.1%
4. Except Machinery, and 61.6 7.6% 4. 76.4 9.2% Supply
and Office Building
Equipment Industry
5. Mining 81.2 9.0%
5. Mining 59.5 7.4% 5. Construction 71.0 8.6%

In line with the policy of the President of the Republic of Indonesia related to economic transformation from the primary sector
industry to value-added (downstream) based industries, starting from 2019 to 2021, the Metal, Metal Goods, Except
Machinery, and Equipment Industry sectors increased by 90.7% from IDR 61.6 Trillion to IDR 117.5 Trillion.

6
Source: Ministry of Investment/BKPM, 2022
NICKEL INVESTMENT REALIZATION
2017 – 2022 Q1

Total Nickel Investment

2017 - 2022 Q1 Total Nickel Investment (2017 – 2022 Q1)
16.3 Billion USD
DDI
6% Nickel FDI
15.4 Billion USD

Nickel DDI
0.9 Billion USD

FDI
94%

7
Source: Ministry of Investment/BKPM, 2022
NICKEL INVESTMENT REALIZATION DETAILS
2017 – 2022 Q1
FDI (in Million USD)
Nickel Ore Mining and Exploration Nickel Processing to Ferronickel, Nickel Pig
250
Iron, Smelter, etc.
191 6.000 5.536
200 183
5.000

150
4.000 3.621

100 3.000
71 75
56 1.962
2.000 1.582
50 1.305
846
1.000
5
-
-
2017 2018 2019 2020 2021 2022 Q1 2017 2018 2019 2020 2021 2022 Q1

FDI :
• Investment in nickel processing is in an upward trend since 2018.
• In 2021, nickel processing investment reach 6.5 times more than investment in 2018.
• Investment in nickel processing is much greater than investment in nickel mining.

8
Source: Ministry of Investment/BKPM, 2022
NICKEL INVESTMENT REALIZATION DETAILS
2017 – 2022 Q1

DDI (in Millions USD)

Nickel Ore Mining and Exploration Nickel Processing to Ferronickel, Nickel Pig
70
62
Iron, Smelter, etc.
60 300 274

50 250
200
40 200
31
30
28 150 134 139

20 100

9 52
10 7 50
12
0
- -
2017 2018 2019 2020 2021 2022 Q1 2017 2018 2019 2020 2021 2022 Q1

DDI :
• Investment in nickel mining in a downward trend since its peak at 2018.
• Investment in nickel processing is stable in hundreds millions USD with a drop below
one hundred million in year 2020.
• Investment in nickel processing is also greater than investment in nickel mining.
9
Source: Ministry of Investment/BKPM, 2022
INVESTMENT REALIZATION
Target 2021 – 2022

Investment Realization Target 2021 Investment Realization Target 2022

• Rp 858,5 T • Rp 968,4 T
(RPJMN 2020 – 2024) (RPJMN 2020 – 2024)
• Rp 900 T • Rp 1.100 to 1.200 T
(President’s order) (President’s order)

To achieve GDP growth as high as

5,4 – 6% in 2022, investment realization
should be increased by
22% - 33%
Source: Ministry of Investment/BKPM, 2022
END-TO-END FACILITATION

Promotion, convince the Assisting the licensing Assisting

investors that Indonesia is service financial closing
‘investment friendly’

Assisting until the Provide end-to-end service to

production stages investors in investment
realization 11
PRIORITY SECTORS

Labour-Intensive
Manufacturing
: Pharmaceutical and
Medical Devices Industry
Infrastructure
Automotive Industry

Electronic Industry

Renewable Energy Mining Industry which

will create added value

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MORE INVESTOR-FRIENDLY FISCAL TERMS

Investment facilities served

25% through OSS / BKPM
<2020
Tax Holiday and Mini Tax Holiday
50-100% corporate income tax exemption for 5-20 years for investment in pioneer
Lower Corporate industries.

Income Tax 22% Tax Allowance

Reduction of corporate income tax by 30% of the investment value for 5 years for

Rates 2020-2021 investment in certain business fields and / or regions.

Import Duty Exemption

Import duty exemption incentives for imports of machinery and goods and materials
for industry and service industries.

(PERPPU No 1/2020)
20% Facility in SEZ
Tax Holiday, Tax Allowance, Exemption of Import Duty and PDRI, as well as excise for
2022 dst investors investing in SEZ.

13
Source: Ministry of Investment/BKPM, 2022
INVESTMENT ACCELERATION TASK FORCE

Background:
Based on the President’s direction so that the implementation of Job Creation Law runs optimally and in order to increase the
investment realization and EODB to support National Economic Growth in 2022 especially the increase in Investment
(Investment Realization target in 2022 of Rp. 1,100 - 1,200 Trillions)

Legal Basis:
Presidential Decree No. 11 of 2021 on the Task Force for the Acceleration of Investment

Organizational Structure of the Investment Acceleration Task Force

Chairman : Minister of Investment/Chairman of BKPM;
Vice Chairman I: Deputy Attorney General;
Vice Chairman II: Deputy Chief of Police of the Republic of Indonesia;

The Task Force aims at quickly resolving problems and obstacles (debottlenecking) for business sectors that are constrained by
licensing efforts in the framework of investment
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SIMPLIFICATION OF BUSINESS LICENSING

Articles related to licensing are integrated in the Job Creation Law

Risk Based Approach Licensing Basic License

Articles related to licensing are integrated Integrate & simplify a number of laws governing basic
in the Job Creation Law licensing

Location Environmental
License Permit
Low Risk • 4 Laws • 2 Laws
Only registration (NIB) • 51 Articles • 36 Articles

Lower Middle Risk

NIB + Standard Building Permit &
Certificate of
Eligibility of Building
Higher Middle Risk Functioning (SLF)
NIB + Standard

• 2 Laws
High Risk • 48 Articles
NIB + License

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Economic Transformation from Primary Sector Industry to
Value-Added Based Industries (Downstreaming)

Export Ban on
Raw Goods
Nickel (2020) Bauxite (2022) Copper (2023)
Increasing Export Value 3-4 years ago 2021 (Prediction)
of Nickel Derivative US$ 1,1 Billion US$ 20 Billion
Products:

Natural Resources-based TRANSFORMASI

Value-added based economy
Economic
EKONOMI
economy (primary) Transformati
on

Focus on natural resources Focus on

that are Indonesia's downstream industry
advantage over other
countries, for example:
nickel, bauxite, copper
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Nickel Downstreaming Puts Indonesia
in the Center of World Electric Car Production
Groundbreaking Hyundai Motor Group and
LG Energy Solution by Presiden Republik Indonesia
Karawang, September 15th, 2021
Source: Ministry of Investment/BKPM, 2022
Investment Plan:
LG : Integrated Battery Industry US$9.8 Billion
CATL : Integrated Battery Industry US$5.2 Billion
Foxconn : Electric Battery Industry, Electric Vehicle Industry
(4-Wheeled, 2-Wheeled, E-Bus), and Supporting Industries
(including charging stations, R&D, and training) US$8 Billion
In addition to downstreaming, investment also has a big
impact through cooperation with SOEs (MIND ID,
Pertamina, PLN), national entrepreneurs in the regions,
especially MSMEs, high domestic component level, and
large absorption of local workers.
Indonesia will become an exporting country for high value-
added commodities.
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Development of the Electric Vehicle Ecosystem
in Indonesia
DOWNSTREAM
UPSTREAM
Electric Car,
Processing / Pre-cursor/ Battery Charging
Mining Battery Cells Electric Motor, Recycling
Purification Cathode Pack Electric Bus, ESS Station

National
Private

Buli (Kab. Halmahera Timur, Maluku Utara) and KIT Batang 10 Gwh (Kab. TBC Jawa Barat, Jawa Spread across Puqing Recycling
Kab. Konawe Utara (Sulawesi Tenggara) (Jawa Tengah) Karawang, Jawa Barat) Tengah, and Jawa different regions (Morowali, Sulawesi
and 20 GWh (TBC) Timur Tengah)
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Source: Ministry of Investment/BKPM, 2022
THANK YOU