Case Indonesia: Attracting Foreign Investment

Indonesia is one of the largest and most populous countries in Southeast Asia, with a growing economy and a large consumer market. The Indonesian government has been actively seeking to attract foreign investment as a way to boost economic growth and create jobs.

To attract foreign investment, Indonesia has implemented a number of measures to improve its business climate. These include simplifying the process for obtaining business licenses, reducing bureaucratic red tape, and improving infrastructure such as roads, ports, and airports.

Indonesia also offers various incentives for foreign investors, such as tax holidays and investment allowances. In addition, the government has set up special economic zones and industrial parks to attract foreign companies in specific sectors such as manufacturing, tourism, and technology.

Despite these efforts, Indonesia faces some challenges in attracting foreign investment. One of the main challenges is the country's complex regulatory environment and legal system, which can be difficult for foreign investors to navigate. In addition, infrastructure development is still a work in progress in many areas, which can be a barrier for some investors.

Overall, Indonesia has made progress in attracting foreign investment in recent years, but there is still room for improvement. The government will need to continue its efforts to streamline regulations, improve infrastructure, and offer attractive incentives in order to compete with other countries in the region for foreign investment.

As an investment analyst working for a global management consulting company (like McKinsey & Co.). The team is tasked to prepare a business proposal for a client who is considering investing in Indonesia (assume 2005-2006). Since the company has a handful of competent analysts, the CEO has decided that only the most realistic and logically sound proposal would be submitted to the client for investment consideration.

Questions:

Information from the case Indonesia: 'Attracting Foreign Investment' should the team Invest in Indonesia?

What business they can do?

And what kind of business structure? (Relocation of the home country company or Setting up a joint venture or Capital investment into Indonesian companies).

Give relevant and broad answer.