Indonesia as a developing country needs a lot of capital sources
to build its country, especially in social and economic sectors. The Indonesian
government has issued policies to encourage incoming of foreign investors to
the country. In order to serve more foreign investor in the way of
communicating, coordinating, and providing information the President of
Indonesia had established the Indonesian Investment Coordinating Board in 1985,
which is still exist until today. The transaction period of changing the power
in this country from Soeharto era to reformation era had made through a very
crucial things, such as uncontrolled mass demonstrations and riots. Those
things had made impact to crisis of social and economy of Indonesia. The
declining of foreign investment on statistics recently was assumed related to
the bad perceptions about the investment climate of Indonesia. Image and
reputation of Indonesia has contributed the building of the perception. This
research was conducted to see in "descriptive and qualitative"
aspects of those foreign investors perceptions about the investment climate.
This research study used a questionnaire survey to 100 respondents, who are
foreign investors. The questioner covers B parameters of the investment dimate
which are based on study and experiences of the researcher, such as security,
law enforcement, good governance, infrastructures, procedures, incentives, cost of investment, and image of BKPM. The survey was followed up by in depth interviews to ten respondents representing foreign investors through incidental and voluntary selections. Interviews were also made to five senior and high level officials of the Indonesian Investment Coordinating Board (BKPM) to see the organization activity. The result of interviews has provided clear pictures of perceptions. Foreign investors' perceptions are bad to the Indonesia's investment climate. The negative perceptions were caused by the bad image of Indonesia, which occupies high score in the country risk list and it has a long in the negative reputation among the most corrupt countries. There is one positive perception about to the Indonesian investment climate. It is low cost of investment, such as low labor cost and cheap fuel and energy costs. These factors make Indonesia attractive for investment. The interesting part of this research discovered that mass media had an important role in disseminating information fastly and it could influence public opinion. The declining foreign investment might be related to those negative perceptions about the investment climate in Indonesia. Conclusions and recommendations were made based on communication concepts. It needs instructive communication from the country's president to manage better government. BKPM has to make persuasive communications to the president with information used for policy making, and informative communications to foreign investors with certainty saying that the government is improving the condition. It is proposed that BKPM should becomes a centre of communication and coordination to all aspects of the organization stakeholders and audiences.
law enforcement, good governance, infrastructures, procedures, incentives, cost of investment, and image of BKPM. The survey was followed up by in depth interviews to ten respondents representing foreign investors through incidental and voluntary selections. Interviews were also made to five senior and high level officials of the Indonesian Investment Coordinating Board (BKPM) to see the organization activity. The result of interviews has provided clear pictures of perceptions. Foreign investors' perceptions are bad to the Indonesia's investment climate. The negative perceptions were caused by the bad image of Indonesia, which occupies high score in the country risk list and it has a long in the negative reputation among the most corrupt countries. There is one positive perception about to the Indonesian investment climate. It is low cost of investment, such as low labor cost and cheap fuel and energy costs. These factors make Indonesia attractive for investment. The interesting part of this research discovered that mass media had an important role in disseminating information fastly and it could influence public opinion. The declining foreign investment might be related to those negative perceptions about the investment climate in Indonesia. Conclusions and recommendations were made based on communication concepts. It needs instructive communication from the country's president to manage better government. BKPM has to make persuasive communications to the president with information used for policy making, and informative communications to foreign investors with certainty saying that the government is improving the condition. It is proposed that BKPM should becomes a centre of communication and coordination to all aspects of the organization stakeholders and audiences.
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