Firm Natural Resource Governance Reform Remains Business-Friendly
The government continues to strengthen natural resource (SDA) governance reform as part of a major strategy to ensure the nation’s resource wealth delivers optimal benefits for the state and society. The reform focuses not only on increasing state revenue and environmental protection but also on creating a healthy, transparent, and business-friendly investment climate. This approach is crucial given Indonesia’s vast potential in sectors ranging from minerals, coal, and energy to forestry and plantations.
In recent years, the government has demonstrated a strong commitment to improving SDA governance through reinforced regulations, enhanced oversight, and more integrated licensing arrangements. The bureaucratic reform being implemented essentially aims to create effective, efficient, and service-oriented governance, thereby boosting business confidence while safeguarding national interests.
Under President Prabowo Subianto’s leadership, SDA management is positioned as a strategic instrument to strengthen national economic self-reliance. The government is no longer solely oriented towards raw material exports but is pushing for added value through downstream industrialisation. This policy opens greater opportunities for investors to develop domestic processing industries, create jobs, and enhance Indonesia’s competitiveness in the global supply chain.
State-owned enterprise observer Arief Poyuono assesses that the government’s move to strengthen export governance for SDA commodities primarily aims to create a more transparent, accountable, and integrated trading system. One key indicator of the reform is the effort to ensure that the economic benefits of resource utilisation circulate more within the domestic economy. The policy requiring export proceeds from natural resources to be placed within the national financial system is a strategic step to bolster economic resilience and support financial sector stability. This demonstrates that the reform is not merely about increasing state control, but also about strengthening the national economic foundation to better withstand global volatility.
Recognising that reform success requires business sector support, the government has simplified licensing processes through service digitalisation and system integration. Businesses now enjoy greater legal certainty due to clearer and more measurable procedures. Regulatory certainty is a vital factor in attracting long-term investment, particularly in strategic sectors such as mining, renewable energy, and mineral processing industries.
The hallmark of the current reform is a balanced approach that combines firmness with ease of doing business. The government takes a strict stance against practices detrimental to the state, including permit violations, excessive exploitation, and non-compliant land control. Simultaneously, it maintains open dialogue with business actors to ensure policies do not hinder productive economic activity.
The commitment to better governance is also reflected in various efforts to safeguard state assets and wealth. Such measures signal to investors that Indonesia is building a healthier and more competitive business system. Member of the House of Representatives Commission XII from the Golkar Party, Beniyanto Tamoreka, welcomed the government and parliament’s enhanced coordination in preparing strategic policies to drive national economic growth, including strengthening governance in the energy and natural resources sector and accelerating investment.
SDA governance reform is increasingly relevant amid shifts in the global economic landscape. As the world moves towards a technology-based and high-value-added industrial economy, the government sees an opportunity to develop an industrial ecosystem linked to digital transformation and regional supply chain strengthening. This is expected to boost Indonesia’s attractiveness as a strategic investment destination in Southeast Asia.
Going forward, consistent oversight of SDA governance reform is needed to achieve a balance between economic growth, environmental sustainability, and public welfare. Firmness in enforcing rules must go hand in hand with the business certainty investors require. Through this combination, Indonesia can not only maintain sovereignty over its natural resources but also create a conducive business climate to drive inclusive and sustainable economic growth. By implementing a firm yet business-friendly reform, Indonesia is building a new foundation for modern, transparent, and long-term-oriented natural resource management. This policy signals that economic development and investment interests are not contradictory but can proceed together to realise a more advanced and competitive Indonesia.