House Commission XI: PFII a chance for Indonesia to capture global capital shift momentum

Deputy Chairman of House Commission XI Mohamad Hekal stated that the acceleration of the Indonesia International Financial Centre (PFII) is driven by a global momentum that opens opportunities for Indonesia to attract the relocation of international funds currently seeking a new home. “The P2SK Law gave birth to the PFII idea and stipulates that the PFII will be established by law within three months. The urgency is not the law itself, but the timing related to geopolitical conditions. Currently, many global funds, including family wealth, are looking for a new home. If Indonesia does not immediately provide a new home, they will choose other countries and may not move again anytime soon,” Hekal said in a statement in Jakarta on Monday. The establishment of the PFII is a mandate of the Financial Sector Development and Strengthening Law (P2SK) that must be realised immediately. Indonesia is trying to leverage geopolitical and global economic dynamics as momentum to attract international capital flows through the formation of the PFII. The presence of the PFII is expected to become a gateway for global funds seeking new investment destinations while strengthening Indonesia’s position as a centre of financial activity in the region. Hekal explained that uncertainty due to conflicts in the Middle East, the Russia-Ukraine war, and changes in the global economic landscape create opportunities for Indonesia to attract international capital flows. According to him, the PFII is part of Indonesia’s major transformation to no longer be merely a capital seeker, but to become a centre of global financial activity. To build investor confidence, Hekal emphasised that the PFII will be supported by a competitive legal framework at the international level. This zone will feature a special dispute resolution mechanism, a commercial court with ad hoc judges, arbitration, the use of English in certain contracts, while remaining subject to international standards for anti-money laundering and counter-terrorism financing. These steps are expected to provide legal certainty while enhancing Indonesia’s competitiveness compared to other global financial centres. Meanwhile, Bank Permata Chief Economist Josua Pardede assessed that the PFII has the potential to become a capital harbour that deepens the domestic financial market while expanding long-term financing sources for national development. According to him, the momentum of global uncertainty must be utilised by Indonesia to offer a credible, transparent, and internationally standardised financial ecosystem. “The PFII can be an instrument to attract global funds, deepen Indonesia’s financial market, and support the financing of strategic projects such as downstreaming, infrastructure, and energy transition. However, its success depends on regulatory consistency, legal certainty, professional governance, and transparency to build long-term investor confidence,” Josua said.