Potential Investment Analysis: A Case Study at Kotabaru Regency, Province of South Kalimantan, Indonesia

Abstract

Investment is not only important for economic growth, but also for developing existing potentials. The
right direction investment will eventually determine performance developments in line with expected result. In correlation
with economy politics in democratic climate as stated in Act UU no. 25 year 2007 regarding capital investment, activities
of capital investment are directed to support populist economy that empowers micro, small and medium businesses
and cooperative. Investment is an important instrument for traffic of capital from domestic or abroad to be invested
in the potential sectors to enhance economic activity. As another impact of investment is not only enhancing economy,
but also absorbing men power which will suppress unemployment number. Foreign capital brought by investors is an
important thing as an instrument to integrate global economy. In addition, investment activities will gain positive
impact for countries who receive capital such as encourage business growth, technological supply from investors either in
production process or machinery, and create employment (Ridgway & Talib, 2002; Soepono, 1993). Since the economic
crisis, Indonesian Law system has beem incapable of creating predictability, stability and fairness. It can be seen
from Indonesian Act which is not synced to law enforcement which supports investment climate and weaknesses in
culture quality (Supardi, 2008; Syahyu, 2003). The method used in the research was survey method, with sample taken
purposively. Data were obtained through observation, interview, and focus group discussion. Data processing was done
with shift share analysis and Location Quotient (LQ). The results showed development plans in Kotabaru Regency should
develop sectors which have competitive advantage to support local economy and contribute to Gross Regional Domestic
Product (GRDP). Therefore, the result will have good point for consideration. The sectors are agriculture, plantation,
fishery, livestock, forestry, tourism, health, mining and energy.