The Investment Dilemma of Aceh |

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By Ayi Jufridar
ISSUE investment in Aceh, Indonesia, look like rosebuds; its beauty and fragrance is tempting to pluck, but without caution will make the hand pierced thorns. Various advantages of Aceh in the field of mining and agriculture, it becomes a "curse" if not good at managing it.

The problem of investment in Aceh has again become the public spotlight lately. Not only the moment of Indonesia, Malaysia, Thailand Growth Triangle or IMT-GT, in general, Aceh has a serious problem with the climate that never improved. IMT-GT Chairman, Dato 'Faudzi Naim Haji Noh, even assess the investment promotion of Aceh is still plenteous so not many investors are interested.

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Investment Inefficiency

Looking more deeply, the problem of investment in Aceh is not just a matter of promotion that is plebeian. There are still many investment constraints that have not been resolved either that are part of a national or a typical Aceh issue. Regulatory issues from the center, licensing, interest rates, exchange rates, and taxation are beyond the authority of Aceh. However, the Aceh Government can set the screen for central variables to improve wind investment in Indonesia, including Aceh.

Ideal role is still a utopia of investment amid the sad condition in Aceh which instead of inviting investors, instead "expel" investors. Extremely high stealth tax issues include those that are typical of Aceh and a condition that leads to investment inefficiency. Various promotions made by the Government of Aceh become meaningless if the cost of stealth is not reduced to then be eliminated.

Stealth taxes are also available in other areas. The difference, outside of Aceh is more controlled and they do not bear the psychological burden as a former area of armed conflict. Investors must have estimated their total cost with details, including thug taxes. Practice in Aceh has become more difficult because after "smoothing" one group, there are other groups that participate blackmail.

A few years ago, a survey team from a multinational company was asked for a smartphone by a certain group in the interior of North Aceh with the threat of kidnapping if it was not met. Finally, the survey was canceled and the planned construction of a crude palm oil (CPO) processing factory was canceled. Abductions of workers have occurred several times in Aceh, including foreign workers in the oil and gas sector in East Aceh who added the Negative List of Investment (DNI) in Aceh. DNI includes the important variables that investors consider.

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Infrastructure and superstructure

The location of Aceh at the western edge of the Indonesian territory is often called strategic because it borders directly with a number of Asean countries. However, this condition is also often viewed on the contrary because of increased distribution costs and access limitations. Compounded by the transportation conditions from and Aceh is not surfing other areas, especially Medan, Sumatera Utara.

The consolidation of plans by a number of district governments to open access to air transport should be supported. It's just that the intensity needs to be increased with increasing passenger volume so as not to harm the airline. Transportations that shorten the distance and time become everything for investors to facilitate the entry of goods, services, and people.

The problem of bureaucratic licensing and the availability of sufficient information is also a variable that should be improved by the Government of Aceh. The availability of skilled labor, raw materials, and other resources is increasingly asserting that improving the investment climate is not just a matter of infrastructure, but also the superstructure. Many aspects outside of investment that should get attention because it is directly or indirectly related to the investment climate. The government can not possibly improve it without the support of business and society.

No matter what the Aceh Government's efforts to improve the investment climate - without the availability of adequate power supplies - will have little effect. Electricity deficits are a constraint to high-cost investments in different regions, not just in Aceh. However, the Aceh Government could continue to improve the electricity constraints by optimizing the power plants owned by PT Kertas Kraft Aceh and PT Arun NGL.

Aceh can actually enjoy the positive trend of increased investment in Indonesia. The release of the Investment Coordinating Board (BKPM) showed that in the first quarter of 2014, there was an increase in investment to Rp106.6 trillion, an increase of 14.6 percent (Rp93 trillion) from the same period in 2013. However, this increase is mostly sucked in Java (58, 2 percent).

The welcome attitude of the Government of Aceh to investors, on the other hand, do not forget the interests of society in the culture and nature sustainability. Some mining and forest sector investment permits, do not harm Aceh for the long term. Investments should give the maximum benefit to society and nature, not short-term gain to the authorities or even be a disaster.[]

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