PFII Opens Path for Global Funds to Enter Indonesia
Indonesia is opening up greater opportunities to attract global capital flows after the House of Representatives (DPR) officially passed the International Financial Centre (PFII) Law. The PFII is expected to expand sources of development financing, strengthen national liquidity, and boost Indonesia’s competitiveness in the race for international investment.
Mohamad Hekal, Chair of the PFII Bill Working Committee, stated that Indonesia must seize the momentum of global fund relocation amid worldwide economic uncertainty. He noted that several other countries have already developed international financial centres to attract foreign capital, and Indonesia cannot afford to fall behind.
Hekal explained that the PFII will serve as an instrument to draw global liquidity that can support development financing and drive national economic growth. “There is a need for investment in Indonesia to spur economic growth. The PFII is expected to become a new pathway for global funds to enter and support our national economy,” he said on Friday (24/7/2026).
He revealed that family office funds managed in various global financial centres amount to approximately USD 3.2 trillion. Of this, an estimated 65 percent is currently seeking new international financial centre locations. Hekal cautioned that this window of opportunity is limited, as investors tend to remain in their chosen destination countries for the long term.
To capture this capital, Indonesia must create an ecosystem capable of attracting new investment flows. Hekal stressed that the PFII will utilise foreign currency as its primary instrument, ensuring that incoming funds represent genuinely new investment rather than a relocation of existing domestic capital. The scheme is also projected to reduce the banking sector’s cost of funds by up to 200 basis points.
“The essence is that PFII is an effort to attract global funds, not to pull funds already existing in Indonesia. We must avoid a situation where domestic funds simply move to obtain certain facilities,” Hekal said.
Beyond broadening financing sources, Hekal assessed that the PFII will build an international financing ecosystem for strategic sectors, ranging from shipbuilding to aviation. This ecosystem encompasses financing services, banking, insurance, and various supporting financial instruments that have largely been enjoyed by overseas financial centres. Hekal affirmed that the management of the PFII must uphold the principles of transparency and good governance, ensuring that incoming funds represent new investment that delivers tangible benefits to the national economy without disrupting domestic financial system stability.