Indonesia is calling on Switzerland to increase its investments in the country, emphasizing the need for stronger economic ties. The fluctuating trade balance between the two nations from 2022 to 2024 has raised concerns, prompting the Indonesian government to push for more foreign direct investment (FDI). Officials believe Swiss investments in Indonesia can play a crucial role in supporting economic growth, particularly in key sectors such as manufacturing and high-tech industries.
Switzerland Investments in Indonesia: Current Landscape
Currently, Switzerland ranks 19th in Indonesia’s foreign investment list, with a total investment value of $244.9 million. This is significantly lower than that of major investors like Singapore, Hong Kong, China, Malaysia, and Japan.
The trade balance between the two countries has also shown fluctuations. “Indonesia’s exports to Switzerland dropped by 26.05% to $210.4 million in 2024 from $284.5 million in 2023. Meanwhile, imports from Switzerland increased by 10.27% to $827.4 million in 2024 from $750.4 million in 2023,” said Deputy Minister of Industry Faisol Riza at the Swiss-Indonesia Collaboration event in Jakarta, as reported by Antara News.
Indonesia’s top exports to Switzerland in 2024 included jewelry, mobile devices, and gold, while imports from Switzerland consisted mainly of gold, regular wristwatches, and luxury metal watches. This trade imbalance highlights the need for increased Swiss investments in Indonesia to create a more mutually beneficial relationship.
Government Incentives to Attract Swiss Investors
To encourage Switzerland to invest more in Indonesia, the government has introduced several investment incentives designed to attract foreign businesses. These include tax holidays, tax allowances, investment allowances, and super deduction tax incentives for vocational schools and research and development (R&D).
“To increase investment, the government has introduced a number of fiscal incentives to attract investors, including tax holidays, tax allowances, investment allowances, and super deduction tax for vocational schools and R&D,” Riza stated.
Additionally, the Ministry of Industry plays a key role in ensuring foreign investors can access fiscal and non-fiscal benefits. “We consistently coordinate the provision of incentives and collaborate with relevant institutions to ensure transparency and regulatory effectiveness, providing legal certainty and support for investors doing business in Indonesia,” Riza added.
Strengthening the Switzerland-Indonesia Economic Partnership
Indonesia aims to strengthen its economic partnership with Switzerland by creating a more favorable business environment. The government is actively encouraging investment in sustainable industries and advanced manufacturing to boost competitiveness.
To achieve this, investors are directed to establish their businesses in industrial zones that align with the country’s economic and environmental strategies. “As mandated by Law No. 3 of 2024, the government directs investors to industrial zones to support sustainable industries, enhance competitiveness, and ensure spatial planning compliance,” Riza explained.
With the fourth generation of industrial zones emerging, Indonesia is focusing on resource processing and logistics efficiency in areas outside Java, while Java-based industrial zones are targeted for high-tech, labor-intensive, and water-efficient industries.
Expanding Switzerland Investments in Indonesia
Looking ahead, the Indonesian government plans to further enhance Swiss investments by offering clear regulations, transparent policies, and streamlined business processes. The push for increased investment aligns with Indonesia’s broader economic goals, particularly in the development of Industry 4.0 and high-value sectors.
By expanding Swiss investments in Indonesia, both countries can benefit from a stronger and more balanced economic relationship. With supportive policies in place, Indonesia remains optimistic that Switzerland will take advantage of these opportunities to invest in its growing economy.
Source: antaranews.com
Image: Kementrian Perindustrian
