Indonesia rolls back on alcoholic beverage investment authorization for foreign companies

JAKARTA, March 2 (Reuters) – Indonesian President Joko Widodo reinstated the ban on new foreign investment in alcoholic beverage manufacturing on Tuesday, just weeks after agreeing to ease restrictions as part of a larger effort to attract investors.

The world’s largest predominantly Muslim country banned new foreign investment in alcoholic beverages in the 1990s, but the president last month issued a regulation that would have allowed it in provinces where Muslims are not the majority of the local population.

However, the regulations have always been criticized by Islamic groups.

“After hearing the comments of the ulama (…) I hereby declare that the presidential regulation regarding the opening of new investments in the alcoholic beverage industry is revoked,” said Jokowi, as the president is popularly known. , in remarks broadcast on television.

Indonesia allows the sale of alcohol in bars and supermarkets in most parts of the country, with beer and wine making up the majority of local income.

Other than alcohol, the president made no reference to other parts of the regulations, which relax restrictions on foreign ownership.

The regulation replaced a “negative investment list”, covering companies reserved for foreign investors, with a new “priority list” offering incentives.

Sectors such as land transport, ship traffic information systems and air navigation are among those open to foreign companies under the regulations. (Reporting by Stanley Widianto and Tabita Diela; editing by Martin Petty)

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