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Suddenly, foreign companies could own 100% of businesses operating in the country’s film industry, including production, distribution and exhibition. That was until February of 2016 when Indonesia’s President Joko Widodo, known as Jokowi, overhauled the NIL in an effort to open South East Asia’s largest economy to foreign investment. Though the NIL was revised numerous times, none of the creative industries were ever removed.
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Likewise, their Cinema 21 subsidiary grew to operate 90% of Indonesia’s movie theatres a percentage now down to 74% with 843 screens accounting for USD $180 million in tickets sales during 2015. This allowed Cineplex 21 to become the only entity with rights to import and distribute every movie in the country, including those from the six Hollywood studios. Suharto’s government protected the company from competition by adopting a Negative Investment List (NIL) which outlawed foreign investment in a wide range of economic sectors such as tourism, grocery stores, wholesale distribution and, specifically, the operation of cinemas. It was during this time, in 1986, that Cineplex 21 Group was founded by Suharto’s half-brother, Sudwikatmono, seizing control of the film industry by monopolizing both the import of films and the country’s cinema chains. The reason Indonesia has become one of the world’s most under-screened territories dates back to the three decades, beginning in 1967, in which the country was under the autocratic rule of Suharto and his New Order regime. To put that in perspective, South Korea, with a population one-fifth the size of Indonesia, has 2,400 cinema screens. Even with so many potential moviegoers, Indonesia only had only 1,117 commercial movie screens at the start of 2016, giving it a per capita screen count of 0.2. It is the fourth most populous country in the world, behind China, India and the United States. Made up of 17,000 islands Indonesia has a population of 260 million people speaking over 300 native languages. Last week Fox International Productions (FIP) positioned itself well to reap dividends from just such an investment by announcing its first Indonesian co-production. While the film industry has been preoccupied with the growth of monolithic movie markets in China and India over the last decade, another country in Asia, Indonesia, has quietly emerged as a territory worthy of cinematic investment.