Government Moves to Loosen Foreign Direct Investment Restrictions

As part of its 10th economic reform package (and possibly the most significant to date), the Government has announced that it will revise the Negative Investment List (Daftar Investasi Negatif / “DNI”) so as to permit foreign direct investment (“FDI”) for the first time in a number of sectors and increase FDI limits in others. The proposed changes are clearly influenced by the need to attract greater FDI inflows to counter the current economic slowdown and to boost the country’s competitiveness in the Asean Economic Community (“AEC”). No doubt the Government also has its eye on the prospect of stiff competition from Trans-Pacific Partnership (“TPP”) countries such as Vietnam.