Luring Foreign Investors to Enter PFII
Executive Director of the Institute for Development of Economics and Finance (INDEF) Esther Sri Astuti said special facilities for foreign investors must be provided to attract them to enter and invest in the Indonesia International Financial Centre (PFII).
“Deepening Indonesia’s financial market. Increasing domestic liquidity, instrument variety, and strengthening regional competitiveness against other financial centres,” Esther said when contacted in Jakarta on Tuesday (18/8).
According to her, to attract investors the government needs to provide special facilities for them, so they are interested and willing to invest in PFII. She explained that PFII must be able to compete with other long-established financial centres, and for that the government can provide ease of investment, tax relief, and legal certainty.
“Special facilities and tax relief are designed to entice foreign funds and investment managers to enter Indonesia,” she said.
She added that Indonesia’s potential must be presented well in order to attract as many investors from abroad as possible. Esther explained that the green economy, sharia economy, and national industrial transformation can be used as drawcards for investors.
Previously, Minister of Investment and Downstreaming/Head of BKPM Rosan Roeslani said the response of investors and family offices from Asia whom his side met regarding the development of the Indonesia International Financial Centre (PFII) has so far been positive.
He said the meeting with investors and family offices was held in Nusa Dua, Bali. His side invited 70 parties from Asia, while those who attended reached 110. “We invited 70 for Asia but those who came reached 110 and the response, alhamdulillah, I can say was actually very positive,” Rosan said at the Press Conference on the RAPBN and Financial Note for the 2027 Fiscal Year in Jakarta on Friday (14/8).
Nevertheless, he said the investors and family offices want to see the structure and format of PFII that conforms to world standards.
President Prabowo Subianto announced Jakarta and Bali as the locations for the Indonesia Financial Centre (PFII) in his speech on the Financial Note of the 2027 State Budget Bill.
PFII transactions use dollars because it is indeed designed to capture the potential of global funds that have been seeking a new financial centre.
Finance Minister Purbaya Yudhi Sadewa confirmed that financial instruments traded at the Indonesia International Financial Centre (PFII) will use foreign currency.
According to him, the current global economic uncertainty actually increases investors’ need for an international financial centre.
If all requirements are deemed to have met the provisions, the Finance Minister will propose the location to the President to be established through a Government Regulation.
According to him, the current global economic uncertainty actually increases investors’ need for an international financial centre.
Purbaya said Indonesia is a new player in the international financial centre competition and therefore needs more competitive incentives to attract global investors.
Judges at PFII are known to be tasked with examining, adjudicating, and deciding disputes related to business and financial activities operating within the special zone.
Finance Minister Purbaya Yudhi Sadewa is preparing tax incentives of 0% for up to 50 years at PFII to compete with Singapore and Dubai in order to attract foreign capital to Indonesia.
The Indonesia International Financial Centre (PFII) zone will be led by a governor chosen by President Prabowo. See the structure and business focus.