Foreign Direct Investment Declines in Q2 2025 as Domestic Investment Continues to Rise
Jakarta, CNBC Indonesia - Foreign direct investment (FDI) performance declined in the second quarter of 2025, even as domestic investment (PMDN) continued its upward trajectory.
FDI in Q2 2025 reached Rp 202.2 trillion, significantly lower than the Rp 230.4 trillion recorded in Q1 2025, and also down from Rp 217.3 trillion in Q2 2024.
Despite the sluggish FDI performance over the first two quarters of this year, Investment and Downstreaming Minister and BKPM Head Rosan Perkasa Roeslani expressed confidence that FDI would recover in coming quarters. He based this optimism on the increasing realisation of capital goods imports each month, according to information he received from Deputy Finance Minister Anggito Abimanyu.
"For FDI and investment overall, we are very optimistic because, as I conveyed from the Ministry of Finance and Deputy Minister Anggito, capital goods imports are at an all-time high. When these come in and they start spending again, we will record them according to the relevant quarter," said Rosan at the Investment Ministry office in Jakarta on Tuesday (29 July 2025).
Nevertheless, Rosan acknowledged that the current slowdown in incoming FDI was largely attributable to constrained global capital flows, as economic uncertainty remains elevated.
"Competition to attract investment is intensifying. At the same time, many policies — including those of the US, which wants to draw investment back to America — are something we must navigate carefully and properly," he explained.
On the other hand, the administration of President Prabowo Subianto is also prioritising domestic entrepreneurs as a key focus for investment in Indonesia. With support from Danantara as the state Investment Management Agency, domestic investors are reportedly in an optimistic phase for expanding within their own country.
"We are certainly giving priority to domestic investors as well, so they can invest in Indonesia. We want domestic investors to enjoy a greater share of the returns available here," said Rosan.
"With the synergy with Danantara, we are seeing this generate higher confidence. So from our perspective, what matters is that the figures remain in line with the targets we have set going forward," he affirmed.
Domestic investment has been on a continuous upward trend since Q4 2024, rising from Rp 207 trillion to Rp 234.8 trillion in Q1 2025, and surging to Rp 275.5 trillion in Q2 2025.
FDI in Q2 2025 reached Rp 202.2 trillion, significantly lower than the Rp 230.4 trillion recorded in Q1 2025, and also down from Rp 217.3 trillion in Q2 2024.
Despite the sluggish FDI performance over the first two quarters of this year, Investment and Downstreaming Minister and BKPM Head Rosan Perkasa Roeslani expressed confidence that FDI would recover in coming quarters. He based this optimism on the increasing realisation of capital goods imports each month, according to information he received from Deputy Finance Minister Anggito Abimanyu.
"For FDI and investment overall, we are very optimistic because, as I conveyed from the Ministry of Finance and Deputy Minister Anggito, capital goods imports are at an all-time high. When these come in and they start spending again, we will record them according to the relevant quarter," said Rosan at the Investment Ministry office in Jakarta on Tuesday (29 July 2025).
Nevertheless, Rosan acknowledged that the current slowdown in incoming FDI was largely attributable to constrained global capital flows, as economic uncertainty remains elevated.
"Competition to attract investment is intensifying. At the same time, many policies — including those of the US, which wants to draw investment back to America — are something we must navigate carefully and properly," he explained.
On the other hand, the administration of President Prabowo Subianto is also prioritising domestic entrepreneurs as a key focus for investment in Indonesia. With support from Danantara as the state Investment Management Agency, domestic investors are reportedly in an optimistic phase for expanding within their own country.
"We are certainly giving priority to domestic investors as well, so they can invest in Indonesia. We want domestic investors to enjoy a greater share of the returns available here," said Rosan.
"With the synergy with Danantara, we are seeing this generate higher confidence. So from our perspective, what matters is that the figures remain in line with the targets we have set going forward," he affirmed.
Domestic investment has been on a continuous upward trend since Q4 2024, rising from Rp 207 trillion to Rp 234.8 trillion in Q1 2025, and surging to Rp 275.5 trillion in Q2 2025.