Foreign Direct Investment in Indonesia’s Agriculture
Indonesia is gearing itself to attract more trade and investment, as well as integrating further into the global economy. The country has been actively pursuing economic cooperation both through regional agreements, such as the Regional Comprehensive Economic Partnership (RCEP) and with individual countries, such as the Indonesia-Australia Economic Partnership Agreement (IACEPA).
Despite these integration efforts, the government has given relatively little attention to attracting FDI in Indonesia’s agriculture. Factors that support or hinder FDI in agriculture may be different from those in other sectors. A thorough understanding of the factors that apply to agriculture in particular are important for policymakers, investors, and to develop an academic understanding of the sector. Acting on this knowledge will help policymakers effectively support rural economic development and sustainable agriculture.