BNP Paribas Explains Why Indonesia's Investment Climate is Positive

TheIndonesia.id - BNP Paribas Asset Management assesses that the macroeconomic stability built by the government despite the global turmoil supports the investment climate in Indonesia to remain positive. BNP Paribas is optimistic about Indonesia's economic prospects.

"We have a positive view of the prospects for investment in Indonesia going forward because we see that in recent years the economic reforms carried out by the Indonesian government have provided stability in Indonesia's macro economy," said President Director of BNP Paribas Asset Management Priyo Santoso at an online press conference in Jakarta, Tuesday, June 28, 2022.

According to Santoso, Indonesia's macroeconomic stability was relatively well maintained amidst geopolitical tensions in Europe and also rising commodity prices which led to an increase in inflation. "We also see how Bank Indonesia carries out interest rate policies and also liquidity policies which on the one hand also contribute and support the stability of the rupiah exchange rate. This is very important for the investment climate in Indonesia," said Santoso.

Santoso believes that the various efforts made by the Indonesian government, such as keeping inflation steady and keeping interest rates at a level that still supports economic growth, will keep investment enthusiasm in the country positive. "Although at this time we see that bond interest rates are starting to increase, we see that with the direction of the Indonesian government's policy and also BI to maintain macroeconomic stability in Indonesia, it will have a positive impact on investment prospects in Indonesia," he said.

Regarding investment, data from the Indonesian Central Securities Depository (KSEI) until the end of December 2021 shows that mutual fund investors have reached 6.8 million, an increase of 92 percent from the previous year. This shows the increasing interest of the Indonesian people in mutual fund investment instruments.

As an investment management company, BNP Paribas Asset Management views that one of the global investment trends that is also expected to become a trend in Indonesia is the trend of sustainable investment or investment with environmental, social, and governance perspectives or ESG. In addition, this year Indonesia holds the G20 Presidency Meeting where a sustainable and inclusive economy is the main topic.

Even at the age of 30, BNP Paribas Asset Management has also confirmed its commitment to the "We Are The Future Makers Movement" where investing is an effort to have a positive impact on the world around you and the next generation. Director of BNP Paribas Asset Management Maya Kamdani said the company's managed funds that adhere to ESG values are currently growing.

"Our managed funds have grown almost five times, so it has reached Rp5.5 trillion as of the end of May. That includes all of our ESG-based mutual funds, both from abroad and abroad," said Maya.