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Strengthening the role ministry of foreign affairs in elevating the inflow of foreign direct investment in Indonesia's electricity sector
As the implementation of its commitment in Paris Agreement, Indonesia has targeted new and renewable energy (NRE) share up to 23% in the energy mix by 2025 and up to 31% by 2050. To achieve this target, Indonesia has planned to develop NRE sourced electricity by building more NRE power plants. According to Electricity Supply Business Plan (Rencana Usaha Penyediaan Tenaga Listrik/RUPTL), it is estimated that the need of investment in electricity sector is Rp. 128,7 trillion per year, however the realization is still far from the target.
With abundant NRE sources as well as growing electricity demand, Indonesia is an attractive investment destination. The Government has improved the investment climate by issuing regulations, however, there are still challenges, particularly in domestic aspects, i.e. local government readiness and price competitiveness. As a part of economic diplomacy, Ministry of Foreign Affairs (MOFA) is responsible to attract foreign direct investment (FDI). Therefore, to support the development of NRE sourced electricity, MOFA should strengthen its role to elevate the inflow of FDI in this sector. Since the challenges are mostly related with domestic situations, MOFA should enhance the coordination among related ministerial/agency, to support the targeted promotion efforts which are conducted mainly through the Indonesian Missions abroad.
| 2021-0308 | SESDILU 71-2021 | Training Materials Repository | Tersedia |
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