Have you ever thought of investing your capital overseas? Foreign investment and company establishment outside of your living area are some examples of diversification, which is a good strategy to achieve higher and more stable returns.
If you are looking for a country to invest your money in, Indonesia is definitely the answer. As the world’s fourth most populous and 10th largest purchasing power country, you can imagine how much potential Indonesia carries.
Therefore, this article will explain how the foreign investment works, why Indonesia is a perfect place to invest, and some business alternatives you can invest in.
Intermezzo: What is Foreign Investment and How It Works
Technically, foreign investment is the flow of capital to businesses or companies in another country. So, being a foreign investor mean putting your capital in the company in another country.
There are various ways to make foreign investment, but it is divided into two types: direct and indirect investment.
In direct investment, you most likely purchase physical assets, such as new buildings or machines. Meanwhile, in indirect investment, you buy a share of the business, such as stocks or bonds.
Indonesia is one of the most potential places for both kinds of investment. Find out the reasons below.
Why Choose Indonesia for Investment?
Foreign investment and company establishment – According to Reuters, foreign investment value in Indonesia by the third quarter of 2022 rose 63,3% compared to the previous year. The flocking of foreign investors to Indonesia shows the potential of the country, and these are some of the reasons:
1. Indonesia is A Huge Market, and It Is Growing
In the opening paragraph, you already know how populous Indonesia is. But how populous?
According to BPS (Indonesia Central Bureau of Statistics), as of June 2022, Indonesia has more than 275 million people residing in the country. That is already more than 3% of people in the world.
In another report, BPS projected that the number would grow to more than 318 million by 2045. Among the number, more than 65% of people is the productive age group.
Combined with the fact that Indonesia has a large buying power, the data shows how Indonesia is the potential location to market your products. In other words, there is also a higher chance for you to get a higher return for your investment.
2. Encouraging Government Regulations
Foreign investment will not be easy to do if the regulations are not supportive, and Indonesia is always improving. And that shows in the Ease of Doing Business index by the World Bank.
According to the index, Indonesia ranked 73rd among 109 countries in 2020. The number may seem high, but Indonesia managed to up its ranks significantly, especially compared to its position back in 2012 which is the 129th.
One of the breakthroughs that cause that achievement is the Online Single Submission (OSS) system which speeds up the whole business-making process. In the future, Indonesia’s government will surely improve their service to help you invest easily in the country.
3. Moderately Stable Economics Situation
According to Reuters, in the third quarter of 2022, Indonesia scored an achievement as the fastest country in South-East Asia in terms of economic growth. Some of the reasons are the increase in export numbers and the rising amount of investment.
Looking back, Indonesia has also been able to maintain its economic stability. For example, during the 2008 crisis, Indonesia loses only 0,1% of its GDP, way below the projection, which is 2,1%.
In the future, Indonesia will most likely be able to maintain its stability in front of the possible 2023 recession. Although an economic slowdown is likely to happen, it will not impact the whole economy.
Indonesia’s government managed to dodge multiple economic crises in the past, and it is likely reflected in future policies. So, if you want to invest, this is the right place.
4. The Rising Middle-Class Population
When it comes to economic development and purchasing power, the middle class holds the key. That is because typically, the middle class holds large buying power, increasing demands and pushing profit.
Moreover, the middle class also drives the market to have healthy competition by supporting market inclusivity. They also have higher economic confidence compared to the lower class, and that increases the number of entrepreneurs.
In 2022, Indonesia officially enters the global market by being an upper-middle country, with 115 million in the middle class. The number will likely grow by 12% each year, just as stated in the World Bank’s article.
5. Easier Product Export Due to SEA Free Trade Agreement
If you invest in businesses whose products are export commodities, you will likely be satisfied with Indonesia’s trade agreements and tax agreements.
As one of the members of ASEAN, Indonesia has the ability to export commodities with lesser tariffs to other members. The reduction ranges from 8% to 25%. In fact, in some agreements, you can also get a full tariff removal policy.
Aside from that, the ASEAN FTA treaty is also beneficial outside the association, as they also have an agreement with these countries:
- New Zealand
As an investor, you should look beyond what is possible. Luckily, Indonesia has a bigger chance to export to other areas. That only means one thing: the possibility to expand your market and the increase in profit.
What is important for investors is a chance for profit and stability. Especially if you are looking for a long-term investment, especially if you are looking for a long-term investment. As you can see in the explanation above, both requirements are well-checked off in Indonesia.
Three Choices of Businesses for You to Invest
Interested in investing in Indonesia? Check out these three business alternatives for you to invest your money in.
1. One of Indonesia’s Leading Digital Marketing Agencies: Arfadia (PT Arfadia Digital Indonesia)
It is hard to imagine life without the internet now, especially for Indonesian citizens. According to CNBC, 76% of Indonesia’s population uses the internet. In number, it is about 210 million people. Moreover, Statista also projects that the number of Indonesia’s internet users will grow by 239 million by 2026.
The number is too big to take lightly, which is what Arfadia sees.
Arfadia is one of Indonesia’s leading digital marketing agencies that has been running for over a decade. They offer 360 digital marketing services, including mobile and web app development, SEO and social media marketing, photography, and corporate branding.
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With well-rounded management, Arfadia manages to help various types of clients, including small businesses and government institutions. And now, Arfadia wants to invite you to invest and flourish together in the market. Simply contact them through the channels below to know more.
PT. Arfadia Digital Indonesia
Website : https://www.arfadia.com/
Instagram : https://www.instagram.com/arfadia/
Whatsapp : +628118867897
Twitter : https://twitter.com/arfadia
Email : [email protected]
2. One of The Most Thorough Media for Bali’s Tourism: Candi.id
Many people know Bali, that is for sure. In fact, “know” could be an understatement, as the island recorded 6.29 million arrivals in 2019 alone.
Known as the Island of Gods, the small island between Java and Lombok offers a great variety of destinations and activities to do. In fact, it is possible for you to go to an energizing and serene lake in the morning, then join the frenzied beach club by night.
Knowing how popular Bali is, Candi.id decides to help the tourists to find great spots for their activities. The newly-established start-up company provides information about the latest news and cool places in Bali.
@candi.id.official Ini dia iconnya Pulau Dewata, Danau Beratan😍 #fyp #bali #baliliving🌴 ♬ Beautiful – Bazzi,Camila Cabello @candi.id.officialMasih pada liburan di Bali ga? Weekend kemarin Bali rame banget. Ada yg udah cobain naik Fly Bali Heli atau rent car mobil di Bali Agung Trans?♬ Milkshake Showmusik Dance Mix – Showmusik Sounds @candi.id.official Yuk sini ke Bali aja! Udah pada ramai loh🥳 #andretaulani #pariwisatabali ♬ French music style, accordion, waltz – arachang
According to a study, social media plays a part in influencing travelers’ decisions to come to a certain place. With their platform, Candi.id wants to boost Bali’s tourism and you are welcome to join this purpose by investing. If you are interested, you can contact them on these platforms.
Website : https://candi.id/
Instagram : https://www.instagram.com/candi.id.official/
Whatsapp : +628118867897
Twitter : https://twitter.com/candiidofficial
Email : [email protected]
Youtube : https://www.youtube.com/@candi2628
3. Indonesia’s First Bottled Goat Milk Supplier: Araca Milk
Goat milk may not be popular as cow milk. However, the data shows that 65% of the global population drink goat’s milk.
In the first quartal of 2022, Statista makes a report about Goat Production in Indonesia from 2011 to 2020. The data shows that the production is quite stable, with its peak being 19.1 million in 2020.
Lining up with the statistic, a study also states that the market for goat milk in Indonesia is promising. All the country needs are more goat milk suppliers, especially outside of Java, Nusa Tenggara, Sulawesi, and Sumatera where the goat farm mostly concentrates. And, that is where Araca Milk specializes.
Araca Milk is a goat farm and goat milk supplier residing in Silakalang, Bali. And not just any supplier, Araca Milk also aims to ease the consumer of the goat milk market by providing the first bottled goat milk in Indonesia.
Araca Milk uses the Etawa goat, one of the most popular dairy goats, due to its quality of milk. Araca Milk ensures that their procedure is safe and clean from end to end. Moreover, Araca Milk applies international standards, such as maintaining sanitation as well as separating female and male goats to prevent milk odor.
One of their goals is to produce good-quality milk for the consumers and the environment safely. You can definitely join their journey by investing through these channels.
PT. Araca Milk Industry
Website : https://aracamilk.com/
Instagram : https://www.instagram.com/aracamilk/
Whatsapp : +628113700387
Email : [email protected]
TikTok : https://www.tiktok.com/@aracamilk
Why is Goat Farming Profitable?
You might wonder, how do farming goats generate profit? These are some of the reasons:
- Goats are easier to maintain. Compared to cows, goats are more adaptable to any kind of weather, and the feed is cheaper than cow’s feed. Size-wise, goats also save space and they can even be in the same cage as other livestock.
- Goat’s cycle is short. It does not take a long time for a goat to reproduce, which is only 4-12 months of age. When it’s breeding, it will only take 5 months before you can start farming its milk. Once in a heating period, a male goat can impregnate up to 50 female goats, depending on its health.
- Various byproducts. Goats have more than their milk. Their meat can also be sold at a good price, as well as their skin as leather. Moreover, you can also create soap, cheese, and many more products from goats.
Health Benefits of Goat Milk
Less Level of Lactose
For some people, drinking cow milk can cause discomfort to the digestive system due to its lactose level. This problem can occur in people with lactose sensitivity and domestic animals.
Because it has fewer levels of lactose, which is more comfortable for the gut, people have been choosing goat milk as a substitute.
Help Body Absorb Nutrition
A study states that goat milk elevates the body’s ability to absorb other nutrients, especially copper and iron, from the food inside the body. Eventually, this results in the milk’s ability to strengthen your immune system wholly.
Helps Undernourished Kids
Due to its high level of calories, protein, fat, and other nutrients, goat milk is often used for undernourished kids or stunting. In fact, the method is often used in Indonesia, where the percentage of stunting is more than 24%.
Building investment in Indonesia is profitable and gives room for you to explore and be creative in the developing country. With Arfadia, Candi.id, and Araca Milk, a safe investment is possible.
Why is Indonesia great for business?
There are several reasons why Indonesia excels on the business side:
- Indonesia is a huge market that continues to grow.
- Government regulations are supportive.
- The economy is fairly stable.
- The middle-class population is growing.
What are the top 3 industries in Indonesia?
The top 3 industries in Indonesia are digitalization industry (Arfadia Digital Marketing Agency), tourist media platform & startup (Candi id), agricultural industry (Araca Milk and Goat Farmland).
What business opportunities exist in Indonesia?
Several business opportunities in Indonesia can make huge profits, like Infrastructure, agriculture, mining, manufacturing, energy, tourism, and digital industries.