Analysis of Factors that Determine Investment Attractiveness in Balikpapan City

Abstract

Economic development has recently been delegated to local governments as a form of implementation of Regional Autonomy according to the regulations concerning Regional Government. Through regional autonomy, the development of potential and resources can be utilized and managed optimally by local governments for the benefit of the community. However, disparities between regions still occur, especially between western and eastern Indonesia. This is due to the "Java-centric"development concept that has been going on for decades. The relocation of the National Capital City (IKN) of the Archipelago is considered to be a solution for equitable development which has been centered on the island of Java and to grow the economy around the new IKN areas, especially the buffer areas. Balikpapan City is the city with the third-best GRDP in East Kalimantan Province, which is largely supported by the oil and gas processing industry. In addition, Balikpapan City is one of the buffers for IKN because its location is close to IKN and already has a several-established infrastructure. The potential possessed is expected to become an economic driver for equitable development that has been Java-centric. In addition, the transfer of IKN also aims to restore the national economy through investments in the IKN buffer. Therefore, this research aims to analyze what factors determine the attractiveness of investment in Balikpapan City. The method used in this research is the Analytical Hierarchy Process (AHP) method. Based on the results of the analysis conducted on five factors, namely bureaucracy and government, social, economic, resources, and availability of infrastructure, it was found that the main priority factor determining investment attractiveness is the availability of infrastructure.