The Reasons Behind Indonesia 'Losing' Rp1,500 Trillion in Investment
Jakarta: The Ministry of Investment and Downstreaming/Investment Coordinating Board (BKPM) has revealed that investments worth Rp1,500 trillion failed to enter Indonesia in 2024. The failure was attributed to issues including licensing services, ease of doing business, and competitiveness.
"We found that in 2024, the unrealised investment figure was around Rp1,500 trillion, possibly reaching Rp2,000 trillion. Why were these investments unrealised? Because of issues such as licensing, an unconducive investment climate, various overlapping policies, and other matters," said Deputy Minister of Investment and Downstreaming/Deputy Head of BKPM, Todotua Pasaribu, at the "Public Consultation on the Draft Regulation of the Minister of Investment and Downstreaming/Head of BKPM to replace BKPM Regulations Numbers 3, 4, and 5 of 2021" event in Jakarta on Friday, 4 July 2025.
To prevent a recurrence this year, the government is preparing a Draft Ministerial Regulation on Investment and Downstreaming/Head of BKPM to replace BKPM Regulations Numbers 3, 4, and 5 of 2021, aimed at building a conducive business climate and attracting investment.
Simplification of OSS System Procedures
Todotua said that the refinement of these three regulations would serve as the foundation for risk-based corporate licensing reform, through the simplification of procedures, strengthening of the Online Single Submission (OSS) system, and enhancement of legal certainty.
"With these revisions, we hope this will also become a breakthrough step in accelerating, simplifying, and particularly providing certainty regarding business licensing," he said.
Nevertheless, he noted that in 2024 the government successfully achieved investment realisation of Rp1,700 trillion, exceeding the target of Rp1,650 trillion.
"This year, the government has set an investment realisation target of Rp1,900 trillion. In the first quarter, we are in a fairly safe position. First quarter investment realisation stood at approximately Rp465 trillion," he explained.
"We found that in 2024, the unrealised investment figure was around Rp1,500 trillion, possibly reaching Rp2,000 trillion. Why were these investments unrealised? Because of issues such as licensing, an unconducive investment climate, various overlapping policies, and other matters," said Deputy Minister of Investment and Downstreaming/Deputy Head of BKPM, Todotua Pasaribu, at the "Public Consultation on the Draft Regulation of the Minister of Investment and Downstreaming/Head of BKPM to replace BKPM Regulations Numbers 3, 4, and 5 of 2021" event in Jakarta on Friday, 4 July 2025.
To prevent a recurrence this year, the government is preparing a Draft Ministerial Regulation on Investment and Downstreaming/Head of BKPM to replace BKPM Regulations Numbers 3, 4, and 5 of 2021, aimed at building a conducive business climate and attracting investment.
Simplification of OSS System Procedures
Todotua said that the refinement of these three regulations would serve as the foundation for risk-based corporate licensing reform, through the simplification of procedures, strengthening of the Online Single Submission (OSS) system, and enhancement of legal certainty.
"With these revisions, we hope this will also become a breakthrough step in accelerating, simplifying, and particularly providing certainty regarding business licensing," he said.
Nevertheless, he noted that in 2024 the government successfully achieved investment realisation of Rp1,700 trillion, exceeding the target of Rp1,650 trillion.
"This year, the government has set an investment realisation target of Rp1,900 trillion. In the first quarter, we are in a fairly safe position. First quarter investment realisation stood at approximately Rp465 trillion," he explained.