Pegatron Corporation, an Apple’s iPhones manufacturer, is looking to start production in April this year after it confirmed the rental of a 2-hectare factory in Riau Islands in Batam. The Taipei-based company’s investment is estimated to reach up to USD 300 million, including an initial investment of USD 40 million. The news came after Pegatron released statement that it has chosen Batam-based PT Sat Nusapersada to assemble electronic products for export purposes.
Pegatron’s decision came just as the deadline to resolve dual leadership in Batam looms. Earlier, there was a lack of clarity on issuance of business licenses, as both the Batam Development Industrial Authority, which reports directly to the central government and the Batam administration had the authority to issue them. The government took a decision to merge the two bodies but it was not supported by the ruling party’s coalition partners. Hence, the implementation has been postponed till after the election in April.
Furthermore, Batam is still waiting on the approval of the Special Economic Zones (SEZs) set forth to incentivize foreign companies to relocate to the island as a consequence of the United States – China trade war. The development of two special economic zones (SEZs) on Batam has been proposed, offering bigger tax incentives for businesses, while retaining its Free Trade Zone status.
(Source: The Jakarta Post)