Prabowo Government Strengthens Legal Certainty as Foreign Investment Flows Predicted to Rise
President Prabowo Subianto has once again affirmed his administration’s commitment to strengthening legal certainty in Indonesia, a step believed to further attract global investors to deploy their capital. The affirmation was delivered at a global economic forum held in Jakarta in early February 2026, attended by representatives of multinational corporations from around the world.
The commitment to legal certainty is one of the principal pillars of the government’s efforts to create a conducive and competitive investment climate. This aligns with data from the Investment Coordinating Board (BKPM) showing a significant increase in foreign direct investment (FDI) realisation throughout 2025, reaching a record US$55 billion. The figure represents a 12 per cent rise compared with the previous year, with the manufacturing and renewable energy sectors serving as the primary drawcards.
Global Investors Welcome Stability and Reform
Global investor interest in Indonesia has become increasingly apparent. A number of investors from Europe and the United States have expressed serious interest in expanding the scale of their operations in the country. John Smith, CEO of Global Ventures, highlighted political stability and the government’s commitment to regulatory reform as positive signals driving investment decisions.
The government under Prabowo Subianto’s leadership is also finalising a new investment incentive package. The package encompasses various facilitations, ranging from streamlined licensing to more attractive fiscal facilities. It is expected to be completed by the second quarter of 2026. The initiative is specifically designed to attract investment in strategic sectors such as industrial downstreaming and the green economy, which are national development priorities.
Ambitious Targets and Investment Security Guarantees
Coordinating Minister for Economic Affairs Airlangga Hartarto set an ambitious investment target for this year in January 2026, namely Rp1,800 trillion. Foreign investment is expected to make a significant contribution towards achieving this target.
The issue of legal certainty, particularly regarding contract guarantees and dispute resolution mechanisms, has indeed been a primary concern for investors. Prabowo Subianto has repeatedly emphasised on various occasions the importance of building a legal system that is transparent and non-discriminatory for all business actors.
Dr Indah Permata, an economist from the University of Indonesia, affirmed that the new government’s promise of legal certainty is crucial. According to her, investors need assurance that their investments will be secure and will not be disrupted by sudden policy changes. Furthermore, Indonesia’s vast digital market potential is also attracting the interest of global technology giants, which are reportedly exploring the construction of data centres and research facilities in the country.