Strategic Location

Strategic Location

Investment Development Zones in Aceh

Aceh is home to four key economic zones: the Sabang Free Port and Free Trade Area (FTZ), Special Economic Zone (KEK) of Arun Lhokseumawe, the Aceh Industrial Estate (KIA) in Ladong, and the Kutaraja Fishery Port (PPS). Each zone boasts unique attractions, along with incentives and facilities to entice prospective investors. These zones are pivotal in Aceh's strategy to establish new economic growth hubs.

1. Sabang Free Port and Free Trade Area

Established under Law no. 37/2000, Sabang is a distinct area exempt from customary trade restrictions (except for quarantine and legally prohibited items), import duties, VAT, luxury goods sales tax, and excise. With a 70-year tenure, Sabang is focused on fostering business growth in tourism, port operations, trade, and the fishing industry. The Sabang Area Concession Agency is responsible for its management and development.

Notable Highlights:

- Sabang serves as Indonesia's western gateway, a prime investment and service hub for international ship traffic, positioned strategically on global shipping routes.

- It boasts a natural harbor more than 20 meters deep.

- Sabang is renowned for its marine tourism and natural beauty.

- Business incentives are readily available.

- There is a sizable land area (708 hectares) with clear ownership, including 1,000 certified parcels available for investors.

2. Arun Lhokseumawe Special Economic Zone

Situated in North Aceh Regency and Lhokseumawe City, this zone was created by Government Regulation Number 5 of 2017. Leveraging Aceh's strategic position along the Malacca Strait, it aims to integrate into the global production network. The zone, a consortium of companies including PT Pertamina, PT Pupuk Iskandar Muda, PT Pelindo 1, and PDPA, encompasses the Arun refinery complex, Dewantara sub-district, and Jamuan Village. 

This zone emphasizes energy, petrochemicals, agroindustry for food security, logistics, and kraft paper production. Projects include LNG regasification, LNG and LPG hubs, Mini LNG Plant PLTG, and clean energy power plants. Enhanced logistics infrastructure, including international standard ports and docks, supports these industries.

Key Highlights:

- The zone covers 2,622.48 hectares, with 896.3 hectares available for development (34.2%).

- It's strategically located with excellent airport connectivity, serving as a gateway to Northwest Indonesia.

- Business incentives are offered.

- The work environment is top-notch with world-class infrastructure.

3. Aceh Industrial Estate (KIA) Ladong, Aceh Besar

Inaugurated on December 20, 2018, KIA Ladong is strategically positioned near key locations: 22.8 km from the city center, 33 km from Sultan Iskandar Muda Airport, 11.6 km from Malahayati Harbor, and 11 km from the Blang Bintang Toll Gate. 

Spanning 66 hectares of the planned 250 hectares, KIA Ladong aims to be a central hub for the halal industry, including food, beverages, and other products. The estate has obtained necessary permits like Estate Regulation, Industrial Estate Business Permit, Environmental Permit, and Location Permit.

Key Highlights:

- The estate spans 67.6 hectares with a future expansion plan of 250 hectares.

- The base land rental rate is RP. 5000/m²/year.

4. Kutaraja Fishery Port, Banda Aceh

PPS Kutaraja is a significant fishing port in Aceh, located in an over-exploited pelagic fish and fully exploited demersal fish area within the WPP 572 fisheries management zone. Positioned in Banda Aceh City, it's advantageously opposite the Malacca Strait and the Indian Ocean, near potential fishing zones and international shipping lanes.

Key Facts:

- The port covers 52 hectares, with 10 hectares currently in use.

- Early tenants include PT. Aceh Lampulo Jaya Bahari and PT. Yakin Pasifik Tuna, both focusing on fish processing and export storage, among others.

- Rental rates are set by Aceh Qanun Number 2 of 2019: mature/solid land at RP. 10,000/m²/year and raw land at RP. 5,000/m²/year.

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These investment incentives and scheme is specifically designed to encourage potential investors and thus reap the positive effects of foreign direct investments (FDI).

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