Special Advisor to the President for Economic Affairs, Bambang Brodjonegoro, admitted that Indonesia is still lagging behind in the competition to attract investment compared to other Southeast Asian countries.
In the MINDialogue event themed “Downstreaming and Industrialization: Key Strategy Towards Golden Indonesia 2045” which was held in Jakarta, on Thursday, January 9, 2025. Bambang cited a number of factors that are the main obstacles.
“Indonesia is still considered a country with a high-cost economy, especially in terms of permits, licensing, and investment administration,” Bambang said.
A real example of Indonesia’s defeat can be seen in the case of Apple’s investment in Southeast Asia. Since 2019, the American technology giant has disbursed investment funds of US$15.8 billion in Vietnam. In contrast, Apple’s investment in Indonesia is only a commitment of US$100 million, which until now still leaves a debt of US$10 million.
Recently, Apple offered a new investment proposal worth US$1 billion after the iPhone 16 smartphone was banned from being distributed in Indonesia. However, according to Bambang, the investment is still at the commitment stage and has not been realized.
“When companies have obstacles to invest in Indonesia, they easily move to Malaysia or Vietnam which offer simpler processes,” he added.
Malaysia, for example, has succeeded in attracting large investments from various global technology companies, such as Alphabet US$1.9 billion, Amazon US$5.9 billion, Microsoft US$2.1 billion, and Nvidia US$4,1 billion.
Although Indonesia continues to be a potential investment destination, many of the world’s giant companies only make commitments without concrete realization. For example, Apple with Rp16 trillion (US$1 billion), Amazon with Rp4.7 billion, Microsoft US$1.7 billion, and Nvidia US$185 million.
Bambang emphasized that Indonesia needs to immediately improve the investment climate by cutting complicated bureaucracy and creating legal certainty for investors. Otherwise, Indonesia will continue to lose great opportunities to compete in the international arena, especially in realizing the Golden Indonesia 2045 Vision.
