Taiwan-based audio system manufacturer PT Meiloon Technology Indonesia has officially begun relocating its factory to Indonesia from China. On Tuesday it broke ground on the new plant in Subang, West Java.
The company is one of seven firms that committed to moving their factories from China to Indonesia in June, representing a total investment of US$ 850 million. Despite the destruction of global supply chains during the pandemic, many companies have started to doubt their heavy dependence on China.
According to data from the Investment Coordinating Board (BKPM), the company, whose factory was previously located in Suzhou, Jiangsu Province, China, pledged to spend $90 million and employ more than 8,000 employees in Indonesia. As a result of special assistance from the BKPM, Meiloon is Indonesia's first reported company to start building its facilities before the issuance of its business license.
"This will serve as a precedent for other regions," BKPM head Bahlil Lahadalia said Tuesday at a virtual press case."It's not time to scare investors anymore. Now, to develop the economy in the regions, we have to work with the regency administrations, provincial administrations, the government and investors.
Previously, President Joko "Jokowi" Widodo had ordered the BKPM to simplify the method of acquiring business permits for relocating companies. He also asked them to promise to back up investors if land acquisition issues or other bureaucratic obstacles emerged. Indonesia is trying to reverse its falling foreign direct investment, which dropped to Rp 98 trillion in the January-March period by 9.2 percent year-on-year (YoY).
Bahlil said Meiloon should offer priority to raw and intermediate products to the local workers and local suppliers. The firm hopes to begin development by the second half of this year at the latest. It plans to market all its goods worldwide, including to its American affiliate, audio group JBL. "We have spent our time surveying several countries for the past two years and finally we decided that Indonesia and Subang were the best country and city to develop our business," said Mellon Industrial Co's chief financial officer, Eva Kuo. Ltd. Ltd.
According to Ball, the government is planning thousands of hectares of land in regency Majalengka, West Java, to establish an industrial park that will draw further investment. An industrial park was also established in Batang regency, Central Java, and became a manufacturing hotspot.
West Java Governor Ridwan Kamil said on Tuesday that he intended to fly to China, Taiwan and other countries to promote West Java to foreign investors once fly restrictions related to the pandemic had eased.
"The investments will be won by those who go to get the ball themselves, and those whose policies are 'wait and see' will become obsolete," Ridwan said, adding that he hoped West Java will remain a top destination for foreign capital inflow.
Leopaard Prawira, a Meiloon Technology Indonesia shareholder, said he hoped that building the firm's factory would enable other companies to expand their Indonesian businesses."This pioneering ceremony shows company licensing can be done quickly in Indonesia," Leopard said. According to the BKPM, there are currently 199 companies considering expanding their businesses in Indonesia with a total potential investment of $41.4 billion and potential for 162,000 jobs.