The positive investment list classifies business fields into four categories, which are priority sectors, business fields with specific requirements, business fields open to large enterprises with compulsory partnerships, and business fields fully open to foreign investment. There are fiscal and non-fiscal incentives available for priority sectors. Investors seeking to expand their operations in Southeast Asia can scrutinize the sectoral requirement listed below.

Indonesia's Presidential Regulation 10 of 2021 as amended to President Regulation No. 49 of 2021 (PR49/2021) liberalizes many business sectors for foreign investment. Dubbed the positive investment list, PR49/2021 liberalizes over 200 business lines, including transportation, energy, and telecommunication.

The general principle under the positive investment list is that a business sector is open to 100 percent foreign investment unless it is subjected to a specific type of limitation. The regulation presents one of the greatest liberalizations in foreign ownership limitations in lndonesia since the negative investment list was first introduced in the 1980s.

To classify as a priority sector, business enterprises must meet the following criteria: A. Must be labor intensive. B. Must be capital intensive. C. Must be part of a national project/program. D. Must be export-oriented. E. Must involve a pioneer industry (renewables, oil refining, metals, etc.). F. Must utilize advanced technologies. G. Must implement research and development activities.

There are 246 business fields under this category of the positive investment list. Moreover, businesses in priority sectors are eligible for a range of fiscal and non-fiscal incentives.

 

Source: asiainvestmentresearch.org