What do most people think of Batam when it comes to mind? We bet it is often something to do with vacation and traveling. But these days, Batam is no longer limited to tourism and hospitality purposes only. Today, this region is fast growing and its booming economy has invited many foreigners to make investments in various business segments.
The Indonesian government has made Batam, or Indonesia overall, a market that is much friendlier with more opportunities for foreign investments. If you are still looking for the ideal place to invest, keep reading to find the compelling reasons Batam offers business opportunities that are favorable for foreign investors, and why you should invest now.
Just 20-kilometer and 45-minute ferry ride away from Singapore, Batam is one of the 3,000 islands making up the Riau Archipelago. It is strategically located within an international shipping path between the Pacific and Indian Oceans, making it an investor-friendly environment with a multitude of cost-competitive advantages, including steady labour supply, space availability, modern and well-developed infrastructure, and strong government support with investments in the overall infrastructure development.
Speaking of labour supply, it is increasingly better in skills due to years of accumulated experience and training. As a result, skilled workforce can be found directly in Batam, without having to source them from other major cities or provinces such as Sumatra and Java.
Furthermore, encountering issues of high labour wage and land scarcity, Batam’s neighbouring country Singapore absolutely benefits from the competitive labour cost and land availability. A close relationship has been formed between the Singaporean and Indonesian governments, encouraging excellent cooperation of private sectors from both countries.
Batam is currently being visited not only by Singporean investors, but also visitors from other countries such as Malaysia, Thailand, Vietnam, Japan and China. They are all looking for the most profitable businesses to dive into.
Often known as an industrial area, Batam has developed into a business heaven that serves some main sectors considered to be the most lucrative for most investors, namely trade (export and import), industrial, tourism, and trans-shipment area. Many foreigners have also come to Batam to purchase real estate and then resell them at better prices. Batam is also known for its great manufacturing facilities, resulting in foreign countries as the main investors in this sector to reap the inexpensive operation costs.
Foreign investors and entrepreneurs are the people who will reap the most benefits in Batam, taking the business scene in this region to a whole new horizon with industrial facilities and incentives in Batam are abundant and readily available. Investors can now opt for ready-to-use commercial factory buildings with complete infrastructure or customised factories that they build from scratch.
There are 14 industrial estates currently existing for foreign investments and some even come with full package with the inclusion of ready permits and licenses. Building a factory is not expensive. A factory with an area of 1,000 square meters on a 2,000 square-meter lot will only cost approximately US$ 200,000 with the cost of land included.
On top of that, Batam makes an even better place for foreign business owners, especially for import and export sector due to the tax and investment incentives. All imported goods for production purposes, including capital goods and raw material, are exempted from import duty and value added tax for being Indonesia’s Free Trade Zone (FTZ) island.
Furthermore, Batam’s One-Stop Policy enables foreign investment application to have a process time of no more than 20 days, with all permits and licenses processes streamlined under one system.
Last but not least, 100% foreign ownership and simpler visa application for foreigners to decrease the bureaucracy result in Batam being a most favourable investment paradise for foreigners from across the globe.
Having professionals with extensive knowledge of the Indonesian market, particularly Batam, Cekindo is your business partner of choice to assist with a smooth market entry. Talk to us now.