From Government of Indonesia

No Stricter Foreign Stake Limit Proposals: BKPM

The government has not received any formal proposals to tighten foreign ownership limits of companies in certain sectors, an official said Wednesday (18/4/07).

"There's no decision on it, and we are still far away from a decision," National Investment Coordinating Board (BKPM) chairman Muhammad Lutfi told Dow Jones Newswires. "There's nothing to worry about."

Bisnis Indonesia reported Wednesday that several departments have proposed such policies.

Several analysts said President Susilo Bambang Yudhoyono is unlikely to accept such proposals as they contradict the government's efforts to boost foreign direct investment in the country.

"I don't see the government is moving toward that direction," said Mirza Adityaswara, head of research at PT Credit Suisse Indonesia.

Standard Chartered economist Fauzi Ichsan said such restrictions are against a new investment law that aims to create a "level playing field" between foreign and local investors.

Parliament last month passed the law, which allows the government to give various tax and non-tax facilities to local and foreign investors to improve the investment climate in the country.

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