Residential Outflow Risk, DPR Urges Government and BI to Safeguard Domestic Investor Confidence
Member of the House of Representatives’ Commission XI, Amin AK, has urged Bank Indonesia (BI) and the Ministry of Finance to monitor the potential rise in residential outflow, which could impact national economic stability. Amin explained that residential outflow refers to the tendency of domestic individuals or economic actors to move part of their assets and funds abroad.
He noted that public and policymaker attention has traditionally focused on foreign capital outflow—the withdrawal of foreign investment from domestic financial markets. However, Amin highlighted another significant development requiring attention: domestic investors increasingly diversifying assets into foreign investment instruments.
While external factors such as global interest rate changes, geopolitical tensions, and global economic slowdowns often drive foreign capital outflows, Amin warned that if domestic economic actors reduce investments in Indonesia and prefer foreign placements, this could signal declining confidence in the nation’s economic prospects.
“When domestic investors start moving assets abroad, the issue is no longer just market dynamics but also perceptions of Indonesia’s economic future. Therefore, this phenomenon requires serious attention,” stated the Prosperous Justice Party (PKS) politician in a statement cited on Saturday, May 30.
The warning follows Indonesia’s external sector showing significant pressure in early 2026. BI data shows the first quarter 2026 Balance of Payments (BOP) recorded a $9.1 billion deficit, reversing from a $6.1 billion surplus in Q4 2025.
The current account also posted a $4 billion deficit, or about 1.1% of GDP. Simultaneously, capital and financial transactions, previously in surplus, turned into a deficit. Amin assessed this indicates mounting pressure on Indonesia’s external sector and capital flows. However, he clarified that the data should not be immediately interpreted as large-scale capital flight.
“Nonetheless, these developments warrant further study as they may indicate rising domestic asset placement abroad,” he added.
Amin said current steps should include strengthening data transparency and deepening analysis of capital inflow and outflow structures.
“Thus, the government and monetary authorities can more clearly determine whether the pressure stems purely from global factors or is also influenced by shifts in domestic economic actors’ investment preferences,” he said. (E-4)