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An Introduction to Doing Business in Indonesia 2024, the latest publication from Dezan Shira & Associates is out now and available for download through the Asia Briefing Publication Store.

On February 14, 2024, Indonesia conducted the world’s largest single-day election, electing a new president, vice president, and parliament members. This marked a significant change in leadership after a decade under President Joko Widodo (Jokowi), who is constitutionally barred from seeking a third term.

Prabowo Subianto, the current defense minister and former special forces commander, was elected as Indonesia’s new president, running alongside Gibran Rakabuming Raka, the eldest child of Jokowi. Prabowo’s administration will inherit an economy that has seen improvements in sovereign ratings under the outgoing leadership.

The Prabowo-Gibran ticket aims for an ambitious economic growth target of eight percent and intends to enhance Indonesia’s energy self-sufficiency by promoting the use of biodiesel derived from palm oil. Analysts predict a growth rate of 4.5-5 percent for Indonesia in 2024, attributed to lower commodity prices and subdued global demand.

Continuity is a key theme for the Prabowo-Gibran administration, promising to uphold many of Jokowi’s policies, including developing downstream commodities sectors, modernizing infrastructure, and maintaining a disciplined macroeconomic governing agenda. The government’s ban on the export of unprocessed nickel and bauxite, with plans to expand to other metals, has elevated Indonesia’s position in the global resource supply chain, particularly for electric vehicle batteries, leading to increased exports.

Prabowo’s vision includes transforming Indonesia into an advanced and developed economy and integrating the Indonesian economy into global value chains. Such reforms entail regulatory changes to facilitate foreign investment, addressing a nascent tax base, and deepening capital markets. Therefore, foreign enterprises and investors eyeing Indonesia must adopt a long-term perspective, recognizing the nation’s sizable population of close to 300 million, its competitive labor market and growing incomes, and industrial opportunity.

This publication, designed to introduce the fundamentals of investing in Indonesia, was compiled by the experts at Dezan Shira & Associates, a specialist foreign direct investment practice, providing corporate establishment, business intelligence, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in emerging Asia.

An Introduction to Doing Business in Indonesia 2024 covers the following:

• Indonesia’s New Positive Investment List
• Corporate establishment;
• Taxation;
• Human resources and payroll; and
• Audit and compliance.