#1North Sumatra' Investment Book A definitive guide on macroeconomic condition, data & information, key contacts, and potential investment projects in North Sumatra Quarter 1-2019 edition on picture: Lake Toba On Issue A glimpse of the enchanting tourism sector and the massive infrastructure projects#2ABOUT US Our mission B Let us help you by North Sumatra Invest (NSI) is a dedicated task force comprised of all North Sumatra's policy makers, including the Government of North Sumatra and Bank Indonesia, with full cooperation of Kamar Dagang Indonesia. PROVIDING Investors with the necessary data & information PROMOTING the right investment opportunities and projects Our mission is to attract Foreign Direct Investment (FDI) in North Sumatra to foster economic growth. ব্রে CONNECTING investors with the right business contacts#3CONTENT Main informations you will find Indonesia's Strong Performance Indonesia is one of the fastest growing economy in the world. Find how we perform relative to our peers. Why North Sumatra? North Sumatra isn't only a great market for your products, but also a perfect place for production base. Potential Projects & Tourism Potential Our handpicked potential projects for you, guaranteed by the government. In addition to that, we specifically collect the potential tourism site in North Sumatra. Licensing in Indonesia A quick guide on getting business license in Indonesia. It's never been easier to do business here. Key Contacts Who to contact if you want to invest and grow your business in North Sumatra?#41st INDONESIA'S STRONG PERFORMANCE#5Indonesia GDP Growth | % year-on year & % quarter-to-quarter 6,0% 5,0% 5,2% 4,9% 5,0% 5,1% 4,8% A Robust Outlook Indonesian economy is expected to have a robust outlook in 2019, above the thriving economy 4,0% 3,0% 2,0% 1,0% 0,0% -1,0% -2,0% 3,8% 3,3% 4,0% 3,1% 4,0% 3,2% 4,2% W -0,2% Q1 Q2 Q3 2015 Q4 -1,7% -0,4% QI Q2 Q3 2016 Q4 -1,8% -0,3% Q1 Q2 Q3 2017 Q4 -1,7% -0,4% 2018 IQtQ -YOY Institutions 2019 Growth (YoY) 3,1% 2019 Budget 5.3 Bank Indonesia 5.0-5.4 IMF 5.1 World Bank 5.2 ЦІ Q2 Q3 Q4 ADB 5.2 -1,7% Consensus Forecast 5.1 (February 2019)#6Ease of Doing Business | Index, Higher rank is better 73 Our concern to Business Business has never been easier in Indonesia. In recent years, our government has put significant effort to boost business climate and we're happy to tell you that our ease of doing business rank has improved significantly. Our efforts to cut licenses gave an impact to the business player. And we plan to make it even easier. There is no better time than now to invest in Indonesia. 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 0 20 20 40 40 60 60 80 109 114 123 122 121 120 120 129 129 128 100 140 91 72 160 Indonesia India Morocco Romania Hungary#7STABILITY Rupiah exchange rate | USD/IDR 15.500 External risk reduced by adequate reserve Balance of Payment | USD bn US$bn Current Account Overall Balance 15.400 IDR/USD 15.300 15.176 Monthly Average 15 15.200 15.100 Quarterly Average 15.000 14.900 14798 5 14.800 14.700 14798 14.661 14.600. -5 14.500 14.400 14.300 14.493 14109 14.200 Data as of February 20th, 2019 14040 -15 14.100 14.000 13.900 1-Oct-18 17-Oct-18 14.031 2-Nov-18 18-Nov-18 4-Dec-18 20-Dec-18 5-Jan-19 21-Jan-19 6-Feb-19 Inflation rate | % year-on-year 1998 2008 12,1 Jul-18 3,6 Feb-19 2,6 (yoy) 82,4 O Capital and Financial Account Reserve Asset (rhs) US$bn 160 121 120 5,42 80 40 40 (9,15) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1*Q2*Q3*Q4* 2013 2014 FX Reserves 2015 2016 2017 2018* | US$ bn (LHS) and month of imports and debt services (RHS) FX Reserves as of January 2019: US$120.1 bn (Equiv. to 6.5 months of imports + servicing of government debt) US$bn 130 120 110 100 90 80 70 60 50 13579 2013 IFX Reserves (LHS) Month of Import & Debt Service (RHS) 79 3579 3 5 7 9 11 2014 2015 2016 Month 15 14 13 12 11 10 9 8 7 6 5 3579 1113 5 7 9 11 2017 2018 2019#8INV. GRADE Investment grade approved! BBB BBB- Investment Grade BB+ Below Investment Grade BB BB- JCRA Fitch Fitch Ratings Moody's Dec 2017, BBB, Rating Upgraded R&I B+ 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 S&P BBB Stable "Indonesia's resilience to external shocks has steadily strengthened in the past few years, as macroeconomic policies have consistently been geared towards maintaining stability. S&P Global BBB Stable Ratings May 2018, BBB-, Stable Rating Affirmed "The sovereign ratings on Indonesia are supported by the government's relatively low debt levels and its moderate fiscal performance and external indebtedness." MOODY'S Apr 2018, Baa2, Rating Upgraded Baa2 Stable "The upgrade to Baa2 is underpinned by an increasingly credible and effective policy framework conducive to macroeconomic stability. Together with a build-up of financial buffers, prudent fiscal and monetary policy strengthens Moody's confidence that the sovereign's resilience and capacity to respond to shocks has improved." R&I BBB / Stable March 2018, Rating Upgraded to BBB, Outlook Revised to Stable "Indonesia's economy continues its strong performance, with inflation remaining low and stable. Fiscal deficits have been reined in, and government debt is low. The economy is becoming more resilient to external, shocks, reflecting small current account deficits and ample foreign reserves." JCR) BBB / Stable February 2018, Rating Upgraded to BBB, Outlook Revised to Stable "....the government led by President Joko Widodo has been pressing ahead with structural reforms aimed to promote sustainable growth.. First, the investment climate has significantly improved.... Second, infrastructure development has been gaining momentum... Third, the external debt owed by the private sector has been curbed since 2016... Taking those into consideration, JCR has upgraded its ratings by one notch and changed the outlook to Stable.#9The Economist: Indonesia rounds out the top five of Asian economies that can look forward to increased investment spending. (January 2018) 1 DESTINATION Investors are flocking to Indonesia China India 69,4 47,1 Indonesia Vietnam Singapore Australia Hong Kong Thailand South Korea Japan Philippines 44,1 36,9 30,6 30,1 28,8 28,7 28 26,6 24,7 Malaysia 24,3 Myanmar 20,2 Taiwan 18,2 0 10 20 30 40 50 60 70 80 1. Source: The Economist - Asia Business Outlook Survey 2017 2. Source: IMF World Economic Outlook, Database October 2017 Total Investment / GDP (%) Total Investment / GDP (%) 0 5 30 25 20 15 10 32,90 Indonesia Enjoys Large Investments Relative to Peers within the Region² 40 35 30,38 29,94 34,17 34,29 34,28 UNCTAD: Indonesia is listed as the top 5 prospective investment destination in the world (June 2017)³ Γ United States (1) China (2) India (3) Indonesia (8) 20 11 11 Thailand (14) Brazil (7) United Kingdom (4) 7 Germany (5) Mexico (7) Philippines (9) 7 7 6 Spain (25) 5 Vietnam (14) 4 Singapura (18) 4 Canada (18) 4 Australia (13) 3 0 5 10 15 20 25 30 40 36 % of executives responding (x) 2016 ranking 35 40 45 2015 2016 2017e JBIC: Amongst ASEAN countries, Indonesia is the most preferred place for business investment (November 2017)4 China India Vietnam Thailand Indonesia USA Mexico 45,7 43,9 38,1 34,5 33,1 26,1 18,2 Philippines 10,6 Myanmar 9 Brazil 6,3 Korea 6,3 Malaysia 5,9 Russia 4,3 Singapore 3,8 % of surveyed who consider each country has promising prospects Turkey 2,7 0 10 20 30 40 50 3. 4. I | India Indonesia I Malaysia Source: United Nations Conference on Trade and Development (UNCTAD) - World Investment Report 2017 Source: JBIC Outlook for Japanese Foreign Direct Investment (28th Annual Survey) 25,11 25,87 25,54 21,21 24,28 Philippines 25,85 22,25 22,00 Thailand 22,72 27,58 26,58 26,75 Vietnam#10Billion USD DESTINATION Investors are flocking to Indonesia The Economist: Indonesia rounds out the top five of Asian economies that can look forward to increased investment spending. (January 2019) 1 China India Indonesia Vietnam Singapore Thailand Japan Australia Malaysia Hong Kong Philippines South Korea Taiwan Myanmar 0 10 58,3 48,7 48,1 39,8 39,2 38,5 36,4 36,4 34,2 32,1 31,9 26,3 25,2 22,5 20 30 40 50 60 ent / GDP (%) Investment/ Total Inv 70 UNCTAD: Indonesia is listed as the top 5 prospective investment destination in the world (June 2017)³ 500 450 400 350 300 250 200 150 100 50 0 United States (1) China (3) Hong Kong, China (4) Brazil (7) Singapore (6) France (14) Netherlands (5) Indonesia Enjoys Large Investments Relative to Peers within the Region² Total Investment GDP (%) 40 35 30 25 20 15 10 11 5 0 India I Indonesia Malaysia Philippines 2017 ■2018 ■2019e Thailand Vietnam JBIC: Amongst ASEAN countries, Indonesia is the most preferred place for business investment (November 2017)4 China India 52,2 ■2016 ■ 2017 Thailand Vietnam 46,2 37,1 33,9 i Indonesia US % of executives responding (x) 2016 ranking 30,4 28,8 Mexico 13,7 Philippines 10,0 Myanmar I I Malaysia 8,6 8,4 Israel (27) Spain (18) Republic of Korea (26) Germany 5,8 Brazil 5,6 Italy (17) Korea 5,1 Taiwan 4,4 Russia 3.7 % of surveyed who consider each country has promising prospects 0,0 10,0 20,0 30,0 40,0 50,0 Australia (9) Switzerland (8) India (11) Germany (19) Mexico (16) Ireland (20) Russian Federation (13) Canada (12) Indonesia (47) 1. Source: The Economist - Asia Business Outlook Survey 2017 2. Source: IMF World Economic Outlook, Database October 2017 3. 4. Source: United Nations Conference on Trade and Development (UNCTAD) - World Investment Report 2017 Source: JBIC Outlook for Japanese Foreign Direct Investment (28th Annual Survey) 60,0#11SPENDING A switch to more productive usage Spending by category | % of total Government spending Budget for education program 25% | IDR tn IDR tn 492,5 500 435,0 450 406,0 390,3 400 370,8 353,4 350 300 250 200 18.5% 150 Rp 410.7 T 100 50 0 Energy Subsidy A 2018: 2014 73.0% Infrastructure A 2018: 2014 130.9% 20% 15% 10% 5% 0% 2012 2013 2014 2015 Energy Subsidy 2014 Real 2015 Real 2016 Real 2017 Real 2018 Outlook 2019 Budget Budget for health program | IDR tn IDR tn 123,1 125 107,4 100 91,4 92,4 4.3% 75 65,9 Rp 94.5 T 59,7 50 50 2016 2017 2018 ■Infrastructure 25 25 2014 Real 2015 Real 2016 Real 2017 Real 2018 Outlook 2019 Budget#12REGIONAL Simultaneous growth all over the region Aceh 5.43 North Sumatra 5.30 Riau 1.28 Riau Islands 5.48 Bengkulu 4.76 SUMATRA (22%) 4.71 4.64 4.54 4.42 4.46 West Sumatra 5.50 Jambi 4.77 Babel Islands 3.70 South Sumatra 6.07 Lampung 5.38 4.34 4.28 4.29 IV I II III IV |2017| 2018 2016 2017 2018 KALIMANTAN (8%) 3.37 3.24 3.35 3.52 5.49 SULAWESI (6%) 6.83 6.74 6.88 7.49 6.18 7.41 6.96 6.65 4.34 3.91 2.00 West Kalimantan 5.07 Central Kalimantan 6.12 South Kalimantan 5.78 East Kalimantan 5.14 North Kalimantan 7.69 IV I II III IV 2017 2018 2016 2017 2018 IV I II III IV 2017 2018 2016 2017 2018 North Sulawesi 6.10 Gorontalo 7.25 Central Sulawesi 5.37 West Sulawesi 5.32 South Sulawesi 6.47 Southeast Sulawesi 6.23 NASIONAL 5,2% 5,1% 5,3% 5,2% 5,2% IV'17 I'18 Il'18 III'18 IV'18 RGDP ≥ 7.0% 6.0% RGDP <7.0% 5.0% RGDP <6.0% 4.0% <RGDP <5.0% JAVA (58.5%) 5.82 Banten 5.98 MALUKU-PAPUA (2.5%) 5.7 5.72 5.72 Jakarta 6.41 5.66 5.65 5.60 5.62 West Java 5.50 BALI-NUSA TENGGARA (3%) Bali 7.59 Central Java 5.28 5.91 0% RGDP < 4.0% East Java 5.65 Yogyakarta 7.39 4.36 3.21 3.77 3.56 3.71 West Nusa Tenggara - 1.43 5.42 2.68 RGDP <0% IV | IV East Nusa Tenggara 5.32 17.1517.56 Maluku 6.41 6.64 7.41 6.99 4.89 North Maluku 8.25 Papua -17.79 West Papua 0.18 -0.74 2017 2018 2016 2017 2018 IV IV I II III IV 2017 | ___|| _||| IV 2018 -9.43 2016 2017 2018 2017 2018 2016 2017 2018#132nd WHY NORTH SUMATRA? tex PORT OF BELAWAN HANIIN TANTO STAR JAKARTA#14Strategic position along the Malacca Strait, a global trade route Geographic advantages of North Sumatra Malaysia ①Kuala Lumpur 2 3 Singapore Mindana Basilan Located in the vast and prosperous area of Sumatra island, with total area of 73.000 km² Celebes Sea A major gateway for trade, both into and out of Sumatra island Jakarta Java Sea Myanmar (Burma) Thailand Malaysi Cambodia Singapore GREATER S GREATER SUNDA Google Indonesia Papua New Quines#15ECONOMY One of the most thriving economy 7 biggest province by economy comparison | % share to National, % growth year-on-year % Share Province 2015 2016 2017 2018 (2018) DKI Jakarta 17.3% 5,9% 5,9% 6,2% 6,2% East Java 14.6% 5,4% 5,6% 5,5% 5,6% West Java 13.1% 5,1% 5,7% 5,3% 5,6% Central Java 8.5% 5,5% 5,3% 5,3% 5,3% Riau 5.1% 0,2% 2,2% 2,7% 2,3% North Sumatra 5,0% 5,1% 5,2% 5,1% 5,2% East Kalimantan 4.3% -1,2% -0,4% 3,1% 5,1% National 100% 4,8% 5,0% 5,1% 5,2%#16DEMOGRAPHIC An advantage like no other Huge & growing population Our 14 million population means huge untapped market for investors, and it grows around 1.8%/year. A Millenial Province Half of our population is under 25 years old and we are open to the great new idea Room for new business With 70% employment rate, we will support new business with adequate human resources Skillful labor Our Human Development Index score is among the best in the nation High level of income Our income per capita is around 44 million Rupiah and constitutes a huge market for any products Low Minimum Wage level At 2.1 million Rupiah / month, our wage level is 40% cheaper than the wage level in Jakarta Source: Badan Pusat Statistik (BPS), 2017#17SECTORAL A commodity based economy Economic share by sector 2018 | % share to total GRDP 27% 21% 20% 18% 14% Employment by sector 2017 | % share to total work force Agriculture, forestry & fishing Manufacturing Trade Construction Other sectors 6% 9% 22% 25% 38%#18EXPORT Supplying the world's biggest markets Biggest export products | % share to total export in 2018 Palm Oil (34%) North Sumatra is 2nd biggest palm oil producer in the country. Products ranging from crude oil to finished products like soap and cooking oil. Natural Rubber (8%) While price's declining then suppress the production, rubber is still one of the greatest. Most of the export is in the form of rubber sheet, Arabica Coffee (4%) Our Arabica coffee (ie. Sidikalang) is among the most highly priced and sought coffee product in the global market. Biggest market for export | % share to total export in 2018 China (15%) The single biggest export market for North Sumatra's products, including palm oil products, chemical and rubber United States (12%) United States is the biggest importer for food and animals products. Other products include palm oil and rubber glove. India (9%) India is one of the biggest importer of palm oil products from North Sumatera, mostly in the form of CPO.#19on CONNECTIVITY Medan Binjai Tebing Tinggi Pekanbaru Tol Medan-Binjai Seksi 2 (Helvetia-Semayang) 6,18 km Seksi 3 (Semayang-Binjai) 4,28 km Tol Medan-Kualanamu-Tebing Tinggi Seksi 2 hingga 6 sepanjang 41,6 km Tol Palembang-Indralaya Seksi 1 (Palembang-Pamulutan) 7,75 km Trans Sumatra Highway A grand scale project to bring fluid connectivity among provinces in Sumatra island. Everything will be more connected, not less. Padang Jambi Tol Bakauheni-Terbanggi Besar Paket 2 (Sidomulyo-Kotabaru) segmen SS Kotabaru-SS Lematang 5 km Bengkulu Palembang Indralaya Terbanggi Besar Bakauheni PROV. ACKN P. NIAS PROV. BIAU Intra Province North Sumatera is among the most connected province in Sumatera. The 'spider web' on the left shows how connected we are, even to the most rural area. Focus on Improvement Due to the scale of the road, maintaining the quality of the road has proven as a challenge for the government. But it's going to change as we swift focus to improve quality.#20Industrial Gas Price in North Sumatra | USD / MMBTU 2016 USD 12.22 /MMBTU 2017 USD 9.95 /MMBTU North Sumatra Electricity | Capacity vs Peak Hour (MW) 1.977 1.744 1.813 1.511 1.542 1.426 2.686 3.323 3.963 Bringing more energy It's true that energy was a bottleneck for North Sumatra productivity. But it was all in the past. The government has put significant efforts to bring energy cost down, and recently it has shown great progress. Industrial gas price for one has been cut to a competitive level, and electricity has been brought back to light. 2011 2012 2013 2014 2015 2016 2017 2018 2019 Plant Capacity - Peak Hour Usage#213rd POTENTIAL PROJECTS IN NORTH SUMATERA ALLANTERNATIONAL AIRPORT#22Lake Toba as Priority Tourism Area World's Largest Volcanic Lake Stunning Landscape in Nature Formed by 3 Major Volcanic Eruptions (last was 74,000 years ago) All-year-round Comfort Climate + 18-24° C Water Surface Elevation at ± 900 m above sea level#23Unmatched Scenery It's a place where nature and culture met, preserved and nurtured. Simply beautiful.#24OPPORTUNITIES Coordinative Area Include 8 Regencies Area: ± 300,000 Ha ung atan Investing in the jewel of North Sumatra Dabbat Greater Lake Toba: Coordinative Area Singkam Danau Toba Pematang Siantar Sarimatondang Seribudolok Ambarita Parapat Pulau Samosir Şibisa Alrport Deara Sitorang Paige Şilangit Alrport Dolok Sanggu Siborongborong Sibisa Integrated Resort Loc.: Toba Samosir Regency Area 602 Ha Integrated Resort "Flower Garden" Loc.: Humbang Hasundutan & North Tapanuli Regencies Area: ± 1,247 Ha Within Designated Development Area: Authoritative Zone 1. Floating Jetty 6. 2. Lake Cruise 7. International Hotel & Resort International Hospital 1. 2. International Hotel & Resort Premium Golf Course 6. Waste Management 7. Outdoor Elevator / Cable Car 3. Sea Plane 8. Cultural Performance 3. Sustainable Energy Plant 8. Flower Garden 4. Aerosport 9. Tourist Bus Service 4. Water Treatment Plant 9. Farm Agri-tourism 5. Cable Car 10. International Event 5. Waste Water Treatment Plant 10. Eco Theme Park#25OPPORTUNITIES Investing in the jewel of North Sumatra Lake Toba Investment Plan: SIBISA INTEGRATED RESORT map detail Legenda Hospitality MICE Commercial UMKM Centre Geo Cultural Park Culture Centre Supporting Facilities Healthcare Botanical Garden Agro Farm wonderful indonesia Golf Area Back of House Green Space District Gateway 0 100 ha 10 ha ( 1 ha#26ACCESIBILITY It's easier than ever to reach Toba Air Connectivity Penang Thailand Kualanamu Kuala Lumpur Kualanamu (KNO) Silangit International Direct Flights : Kuala Lumpur, Singapore, Bangkok Singapore Domestic Direct Flights : Jakarta and many cities in Indonesia Silangit Airport (DTB) Domestic Direct Flights : Jakarta and Kualanamu International Direct Flights : Singapore, Kuala Lumpur (Malindo Air) Sibisa Airport (SIW) Open for special flights Jakarta Belawan Stabat о ° Medan Binjai Kualanamu Lubuk Pak Airport Tebing Tinggi Pematangsiantar Sidikalang Pulau Samo Sibisa Airport Balige Pakkat Silangit Airport Surabaya Bandung Bali International Flights Domestic Flights#27Kuala Tanjung Port & Industry Zone Kuala Tanjung Port is developed with 3 functions at its core The seaport will function as Sumatera gateway, which means flow of goods will be centered in Kuala Tanjung. Benefit reducing logistic cost Main Gateway As a trans-shipment hub, Kuala Tanjung will be the new distribution center for container and cargo Benefit reducing logistic cost and distribution Integrated industrial cluster, benefitting companies with better distribution chain, more efficient operation cost, while bringing companies closer to raw material Industry Zone Trans Shipment#28Development Timeline 2 Multipurpose 1 Terminal (2015-2017) Industrial Area 3000 Ha (2016-2018) Multipurpose Terminal Project Spec • • CAPEX: 3.7 Trillion Rupiah Dimension 60 x 500 Mtr JETTY Length of Trestle 2,85 KM Lenght of Berth 1.000 Mtr (2x 500 Mtr) Bearing Capacity 3 Ton/M2 Water Depth -17 M. LWS BERTHS CAPACITY Liquid Bulk Carrier: max. DWT 50.000 Container Vessel: max. DWT 60.000 • YARD AREA Total Area ± 18 Ha Tank yard ± 4 ha Container yard ± 14 ha Bearing Capacity 6 - 8T/M2 MODALITIES: Excellent Rail, Road connection & Energy 4 Industrial Gateway Port Project Spec Dimensi: 60 x 300 Mtr . JETTY Dedicated Terminal 3 (Hub Port) (2017-2019) Integrated Urban Area Trestle : 825 Mtr Causeway 1500 Mtr Jetties 600 Mtr (2x 300 Mtr) Capacity: 3 Ton/M2 Draft: -15 M. LWS JETTY CAPACITY Coal Carrier: max. DWT 60.000 Clinker Vessel: max. DWT 60.000 • • • AREA CAPACITY (100 Ha by 2017) Power plant :20 Ha Coal Storage: 20 Ha Cement factory: 7 Ha + 15 Ha Public area: 5 Ha Supporting Power : 6 - 8 T/M2 INFRASTRUCTURE: Railway, Trans Sumatera Highway 28 (2021-2023)#29ACEH Langkat Dairi Karo NORTH SUMATRA GATEWAY REGION Binjai Medan 2 Malacca Strait 13 Serdang Bedagai Deli Serdang 4 Tebing Tingg Vegetable oil and rubber plantations 1 Medan Metropolitan Area 2 Belawan Port 3 Kuala Namu Airport Simalungun Batubara 5 Asahan Trans-Sumatran Rail/Road 4 Kuala Tanjung Port 5 Sei Mangkei Special Economic Zone Economic Growth Driver Kuala Tanjung, together with Sei Mangkei SEZ, Kuala Namu Airport, Belawan Port, and the new Trans Sumatera Highway are built to be the new growth drivers in the region, Highly connected. These National Strategic Projects will bring a new level of efficient logistic chain and fully integrated production base.#30Sei Mangkei Special Economic Zone To be a modern industrial city with high competitiveness and eco-friendly mindset, through optimal development of local natural resources. Legality Location Area Area Manager Administrator Investment amount Labor force Infrastructure and facilities Connectivity into and out of SEZ PP No. 29 Tahun 2012 Tentang KEK Sei Mangkei Simalungun Regency, North Sumatera 1,933.80 ha PT Perkebunan Nusantara III (PTPN III) Badan Pelayanan Perijinan Terpadu dan Penanaman Modal Kab. Simalungun • Infrastructure Rp. 5,14 trillion • Est. total investment by 2025: Rp. 129 trillion 83,304 people by 2031 Railroad, electricity, water treatment, palm oil R&D center, industrial gas available Highway, electricity, gas pipe, dedicated train connectivity direct to Kuala Tanjung sea port, Kualanamu airport#31Development Timeline 1 Base Industrial Zone of 104 Ha (2010-2015) Companies Investing in Sei Mangkei SEZ Unilever PT UNILEVER OLEOCHEMICAL INDONESIA 2 3 Industrial Zone + Infrastructure add 640 Ha (2015-2020) RealStrongⓇ AgriCulture Innovation PT. All Cosmos Indonesia Integrated Industrial Zone add 1.993 Ha (2020-2035) PT. Alternative Protein Indonesia (a multinational consortium) PT PERKEBUNAN NUSANTARA III (PERSERO) 31#32Subsidy and incentives for SEZ Income Tax • ● Tax holiday for investment >Rp 500bn Tax allowance of 30% from NI Faster depreciation allowed No VAT for import ● No VAT for transactions with tenant in Sei Mangkei Dedicated wage council One Labor Union allowed. Better regulation for expat workers Labor Visa on arrival for 5 visits ⚫ Immig Multiple visa for 1 year • Living permit to owners of property • ration FISCAL VAT Foreigner Property Right Tourism Sector • • . Foreigners can own property Owner of property can get living permit Deduction between 50- 100% for construction and entertainment tax Rights to build permit Easier process for land • permit NON Land Regulation FISCAL 3 hours licensing All licensing can be done. through SEZ administrator Licensing 32#33Tun Medan City's LRT & BRT Scheme 30.000.000 25.000.000 20.000.000 15.000.000 Total Gridlock Prediction by 2024 10.000.000 5.000.000 Tunney's Pasture Stati Eastbour 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Total car width 2015 2016 2017 As one of the biggest cities in Indonesia, Medan's limited public transport and huge growth of 2018 2019 2020 2021 2022 2023 2024 OC Transpo Total street width private car ownership are predicted to lead to gridlocks in major roads in Medan by 2022. The integrated Light Rail Transit (LRT) and Bus Rapid Transit (BRT) scheme is the government's solution to it and will become an important infrastructure to the city with 2,2 million people. BTranspo a LRT illustration#34ULSA 12 MAJU HELVET WILLWALL OLIMPYA HAMRIN CAREFOUR BK-7633-DF 02-15 JADOMUT AC 12 PETISAN TS 4 T OHAB AGAZ OHABOAST MATAD UMHUMUOMIM The inadequacy of current mode Currently, the public car (pictured) is the most widely used public transport in Medan city. It's not only inadequate, but also messy since they don't have a station. The LRT & BRT scheme will not only help untangled predicted gridlock, but also become a reliable transportation mode for the city.#35Scheme : Public Private Partnership - Apx. Distance: 20 km (LRT) &00000 14 km (BRT) Inv. Opportunity: IDR 20 tn (LRT) & IDR 1 tn (BRT) Concession Period: 35 years Payback Period: 16,47 years Project IRR (35 years): 14,7% *Latest feasibility study result 888 The Initial Blueprint for Medan LRT&BRT Halte BRT Koridor BRT Stasiun LRT Koridor LRT Direct Service ITDP, 2017 0 30 0 45 km#36Medan City Zoo Expansion Medan Zoo is Gaining Visitors Number of visitor 250.000 200.000 150.000 100.000 50.000 2007 2008 2009 2010 2011 As Medan city, with its 2,2 million people and its role as the capital of North Sumatra, develops economically, its people need various entertainments. One of them is Medan Zoo, which has become attraction for visitors. Expecting similar growth in the future, the Government offers investors to partner up and develop the zoo#37Modern Zoo Revamping the zoo by increasing the variety of the animal. 01 02 Theme Park Well who doesn't love a theme park? 03 Botanical Garden Adding a touch of botanical x garden to further increase × the attractiveness X Our concept for the 30.000 m2 Investment Opportunity IDR 250 bn#38Medan Public Hospital Expansion ROIDE PORNGADA Pr RSU Dr. PIRNGADI 000 Public Private Partnership opportunity to expand the Dr. Pirngadi Public Hospital in Medan city. The project includes building the VIP wing in an a area GAN RU of ± 10.000 m2. DI DR. PIK#391 Meulaboh Pantai Muara Opu Blang Pidie 6 Man South Tapanuli Regency 5 2 Cinchona bang Orang Utan Batang Toru South Tapanuli Regency Gunungsitoli Pulau Nias Hinak 3 Teluk Pematang Siantar Sibolga 3 4 2 SUMATERA UTARA Padang 1 Sidempuan Potential Tourism Site Mursala Island Central Tapanuli Regency Google 4 Poncan Island Sibolga City Bukittinggi Padang Panjang AH2 6 Mala Kuala Lumpur E26 Ο Tangkahan Langkat Regency NEGERI SEMBILAN 5 Dumai Silahi Sabungan Dairi Regency Pekanbaru RIAU PAHANG Pekan C AH18#40The Home of Turtles Muara Opu Beach With 14 km shore length, Muara Opu beach is home for thousands of turtles to breed once a year. And at that majestic moment, the experience is breath taking.#41The Oldest Orang Utan Batang Toru Forest Batang Toru forest is home to one of the oldest orang utan, the Pongo Tapanuliensis, which currently only 800 still exist#42The King Kong Island Mursala Island Due to its awesome scenery and authentic wilderness, Mursala Island is famous as the place for the shooting of King Kong movie (2005)#43"The Island" Poncan Island Imagine an island with a beautiful landscape, and a blue ocean. Where the water so clear you can see everything underneath. That's exactly what Poncan Island offers you.#44Blending In Silahi Sabungan Natural beauty, cultural experience and religious pilgrimage, Silahi Sabungan is a place like no other to find inner peace#45The Hidden Paradise Tangkahan Some calls it the hidden paradise, Tangkahan is a nature wonder where you can play and have fun with the friendly elephant#46Lau Simeme Dam Deli Serdang The water could stream within the power up to 13 million m² dam water discharge, which could be used as hydroelectric power plant. This project is essentials, as it's the human being basic needs.#474th LICENSING IN INDONESIA#48LICENSING Main Policy Policy Goals Enhanced business licensing through OSS Improve efficient, streamlined, & integrated business license service standards Provide business licensing process assurance in terms of the costs and lead times Overcome the barriers to doing business in Indonesia 1 2 Accelerate the business licensing process 3 = 1st Phase Forming a Task Force to identify & overcome the end-to-end licensing barriers Implementing a licensing checklist for Special Economic Zones (KEK), Free Trade Zones (FTZ), Industrial Zones & Tourist Zones Utilizing data sharing Source: Coordinating Ministry for Economic Affairs 4 5 6 Increase coordination & synergy between central & regional government Implement integrated licensing process (single submission) 2nd Phase Business license regulatory reforms Implementation of the Single Submission system Note: 1st and 2nd Phase are implemented in parallel#49wwwwww LICENSING Direct construction permit in industrial estates Priority Investment Service Direct Construction (KLIK) Investors can directly start their project construction before obtaining construction permits. This service is supported by both Central and Regional Governments which become the first step to synergize between central and local licensing No Requirements No minimum investments or workers is required. Available for 32 selected industrial estates. Construction permits can be obtained in parallel with construction process. 000 000 000 000 000 00000 000 0000000 Obtain investment licence at OSS at national or regional level. Survey a land within selected industrial estates. • • Acquire the land for your industry. Start the construction of your project. No other permits are required. Apply for building construction permit & environmental permit, in parallel with construction process. Until December 2017, 115 projects have utilized the "KLIK services" Source: Investment Coordinating Board (BKPM)#50th KEY CONTACTS IN NORTH SUMATRA LO TW MARRIOTT#51OUR TEAM We are fully committed to help your investment BB SUMATERA UTARA Bank Indonesia Rizki Rahmawati Investment Relation [email protected] +6287722887165 Promotion and Licensing Division Government of North Sumatra Ninta Gandana Purba Division Head [email protected] +628126005630 SUMATERA ITAKA Planning and Development Body Government of North Sumatra Hasmi Lubis Division Head [email protected] +628126558330 lake toba caldera of Kings Authority of Lake Toba M. Rommy Fauzi Director of Tourism [email protected] [email protected] +6281808686886 Sei Mangkei SEZ PTPN III Yenni Fransiska Promotion & Marketing [email protected] +6281264992088 PELINDO 1 INDONESIA GATEWAY Kuala Tanjung Port Pelindo I Kurnia P. Nasution Promotion & Marketing [email protected] +62 21 3912198#52Empty