Indonesia courts foreign capital

Indonesia is trying to turn a commodity-heavy economy into a broader investment story, with President Prabowo Subianto putting a new state fund at the center of that pitch. (setkab.go.id) Prabowo launched Daya Anagata Nusantara, or Danantara, on February 24, 2025, and said it would channel about $20 billion into “strategic projects” including nickel, bauxite, copper, food, renewable energy, oil refining, petrochemicals and artificial intelligence. (setkab.go.id) (channelnewsasia.com) Danantara says it was created under Law No. 1 of 2025 as an independent institution under the president to manage and optimize government investments and assets from state-owned enterprises. Its website says it coordinates both operational and investment holdings and is meant to improve governance, asset value and long-term growth. (danantaraindonesia.co.id) The timing lines up with a wider regional push for capital. The Association of Southeast Asian Nations said foreign direct investment into the bloc reached a record $230 billion in 2023, even as global foreign direct investment fell 10 percent, with the region taking 17 percent of worldwide inflows. (asean.org) Indonesia is selling scale inside that regional market. Statistics Indonesia said the economy grew 5.11 percent in 2025 to 23,821.1 trillion rupiah, or about $5,083 per person, and the World Bank’s latest current-dollar series put 2024 output at about $1.396 trillion. (bps.go.id) (data.worldbank.org) Its export base is still rooted in raw materials and basic processing. Trade data compilations for 2024 show coal, palm oil, ferroalloys, petroleum gas and copper ore among the largest export categories, which helps explain why Jakarta keeps pairing “downstreaming” with investment outreach. (oec.world) (bps.go.id) The government is also trying to show that the pitch is not only about mines and smelters. At Indonesia AI Day in Jakarta on November 13, 2024, Nvidia, Indosat Ooredoo Hutchison and GoTo launched Sahabat-AI, a family of open-source large language models built for Bahasa Indonesia and other local languages. (blogs.nvidia.com) Nvidia said the effort targets more than 277 million Indonesian speakers and ties into a domestic “sovereign AI” push, with local cloud and model-building capacity rather than relying entirely on foreign platforms. That gives officials another way to argue Indonesia can absorb capital in higher-value sectors as well as commodities. (blogs.nvidia.com) (asean.org) The sales pitch comes with scrutiny. When Danantara was launched, Channel News Asia reported concerns from observers about transparency and audit oversight, even as officials said the fund would be run prudently and accountably. (channelnewsasia.com) (setkab.go.id) For now, Indonesia’s message to foreign investors is that the country wants to be funded as both a resource supplier and a regional platform. Danantara is the vehicle meant to make that case concrete. (channelnewsasia.com) (danantaraindonesia.co.id)