Jakarta, CNBC Indonesia - The government will build a Special\nEconomic Zone (SEZ) in the financial sector or Indonesia financial\ncentre in Bali, Indonesia. This financial SEZ will adopt a model similar\nto that implemented in Dubai.<\/p>\n
This step is viewed as a strategic effort to attract global capital\nflows while strengthening Indonesia\u2019s position in the increasingly\nfragmented international financial architecture.<\/p>\n
Head of Economics at Trimegah Sekuritas Indonesia, Fakhrul Fulvian,\nassesses that the idea arises from a real need to address changes in the\nglobal landscape, but it also carries non-trivial consequences.<\/p>\n
\u201cIn a world that is becoming increasingly fragmented, where dollar\nliquidity is no longer as loose as before, countries are indeed\ncompelled to create new pathways to attract financing. A financial SEZ\ncould be one instrument for that,\u201d said Fakhrul on Wednesday\n(28\/4\/2026).<\/p>\n
According to him, much of the financial activity related to Indonesia\nhas so far taken place in global financial centres such as Singapore and\nHong Kong. This reflects a gap between the size of the domestic economy\nand the depth of the national financial sector.<\/p>\n
\u201cWe have a large economy, but financial intermediation largely occurs\nabroad. The financial SEZ is an effort to \u2018bring back\u2019 some of those\nfunctions domestically,\u201d he explained.<\/p>\n
Furthermore, the financial SEZ is also seen as a space for\nexperimentation with various financing innovations, including\nstrengthening local currency transaction schemes and diversifying\nnon-dollar funding sources.<\/p>\n
However, Fakhrul warns that imitating the Dubai model - known through\nareas like the Dubai International Financial Centre (DIFC) - cannot be\ndone directly without considering fundamental differences in economic\nand political structures.<\/p>\n
\u201cWhat is often overlooked is that the Dubai model is not just a\nbusiness zone, but a system with a legal regime, regulators, and\ngovernance that is very different from its national system. This touches\non issues of legal sovereignty and institutional design,\u201d said\nFakhrul.<\/p>\n
He added that in the context of Indonesia as a democracy with a\ncomplex institutional structure, implementing such a system will face\nsignificant political-economic challenges.<\/p>\n
In addition, there is a risk that the financial SEZ could create\ndualism in the national economy if not designed carefully.<\/p>\n
\u201cThe biggest risk is not that this SEZ fails, but that it succeeds,\nyet only creates an enclave integrated with global markets, while the\ndomestic system remains left behind. This could give rise to \u2018two\nIndonesias\u2019 in one country,\u201d said Fakhrul.<\/p>\n
Moreover, he emphasises that the success of global financial centres\nis not determined solely by fiscal incentives or competitive\nregulations, but also by policy consistency and long-term\ncredibility.<\/p>\n
\u201cTrust cannot be imported. It is built through consistency. Without\nit, the financial SEZ will only be an ambitious project that struggles\nto achieve structural impact,\u201d he said.<\/p>\n
The Indonesian government is considering Bali as the location for\nbuilding an international financial centre or Indonesia\u2019s international\nfinancial centre.<\/p>\n
This was stated by Coordinating Minister for the Economy Airlangga\nHartarto on Monday (27\/4\/2026), when met at his office in Jakarta.<\/p>\n
\u201cYes, of course we see an opportunity for a financial centre, to\nprepare for it as well. With geopolitical changes, Bali becomes\nattractive,\u201d said Airlangga.<\/p>\n
For the construction process, Airlangga said the government is\ncurrently preparing the regulations first. The manager of the Global\nFinancial Centre in Indonesia, according to Airlangga, will come from a\nnon-governmental institution, although there is an option for it to be\nmanaged by BPI Danantara.<\/p>\n
\u201cTo what extent the regulations can accommodate what is requested for\nestablishing a financial centre or family office. A financial centre is\nentirely managed by, in quotes, non-governmental, but if Danantara\nmanages it, that\u2019s fine too,\u201d said Airlangga.<\/p>\n
Finance Minister Purbaya Yudhi Sadewa also admitted to having agreed\nwith the National Economic Council (DEN) under the leadership of Luhut\nBinsar Panjaitan regarding the establishment of an International\nFinancial Centre in Indonesia.<\/p>\n
However, Purbaya said that this international financial centre will\nbe established in Indonesia not in the form of a Family Office as has\nbeen circulating, but in the form of a Special Economic Zone (SEZ) for\nthe Financial Services sector.<\/p>\n
\u201cActually, it\u2019s not a family office; it will be a special economic\nzone for the financial sector,\u201d said Purbaya at the BPPK Building,\nJakarta, on Friday (24\/4\/2026).<\/p>\n
Purbaya said there is already a reference for building a Financial\nServices SEZ that is most suitable for Indonesia, namely the one already\nbuilt in Dubai. Therefore, he assesses that the Financial Services SEZ\nproject can be built quickly.<\/p>\n
\u201cThe one that fits for me is the Dubai model, like that. We will\npursue it in the near future,\u201d said Purbaya.<\/p>\n
According to Purbaya, President Prabowo Subianto has also agreed to\nbuild the Financial Services SEZ. The construction of the project, he\nsaid, will be led by Coordinating Minister for the Economy Airlangga\nHartarto.<\/p>\n
\u201cThe President has given instructions and guidance. So, the\nCoordinating Minister for the Economy will lead his team; we will assist\nfrom there,\u201d he explained.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/economist-warns-against-financial-sez-creating-two-indonesias-1777434750", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }