HARIANEXPRESS, JAKARTA – Indonesia’s Parliament passed a bill to establish an international financial center on Tuesday, July 21, 2026, a move aimed at attracting foreign investment and accelerating national economic growth. While the law was passed in Jakarta, the resort island of Bali is a prominent candidate for the center’s physical location.
The newly approved legislation allows for the creation of an Indonesian International Financial Center (PFII), which Finance Minister Purbaya Yudhi Sadewa stated is crucial for drawing foreign capital. This initiative seeks to provide a sustainable source of financing to expand Indonesia’s economic output.
The bill, passed unanimously by all parliamentary factions, covers the institutional framework for the financial center. It also includes provisions for broad tax incentives and the establishment of an arbitration body alongside a special court to handle disputes within the center.
Lawmaker Mohamad Hekal noted that the new law also grants exemptions, permitting the use of foreign currencies for business conducted within the IFCs. Previously, the Indonesian rupiah was the sole legal tender for such transactions.
Finance Minister Purbaya Yudhi Sadewa emphasized the government’s intention to begin the center’s operations this year. He further added that the government is currently preparing the necessary implementing regulations to operationalize the new financial hub.
“PFII attracts foreign capital flows and a sustainable portfolio investment as a long-term source of financing to expand the national economic pie so that Indonesia’s economy can grow faster,” ujar Purbaya Yudhi Sadewa (Finance Minister) di Jakarta, Selasa, 21 Juli 2026.
Sadewa highlighted the current period of heightened global uncertainty as an opportune moment for Indonesia to establish such a center. He argued that demand for financial hubs tends to increase during market volatility.
“When uncertainty is high, demand for financial centers increases. If global conditions are calm, it would be more difficult for us to compete,” ujar Purbaya Yudhi Sadewa (Finance Minister) di Jakarta, Selasa, 21 Juli 2026.
While the finance minister has the authority to determine the final location, several proposals are under review. Among the key sites being considered are the Kura Kura Bali Special Economic Zone on Serangan Island and the Sanur Special Economic Zone in Bali.
Investment Minister Rosan Roeslani, who also leads the sovereign wealth fund Danantara Indonesia, indicated the financial center is part of Jakarta’s broader strategy to position itself as a trusted destination for long-term investors. He also outlined plans for an independent court system, financial authority, and corporations within the center.
President Prabowo Subianto has endorsed the Bali International Financial Center initiative, aiming for an approximate investment target of US$6 billion (IDR 104.4 trillion). This project is seen as a strategic imperative to diversify Indonesia’s economy and enhance its global competitiveness.
The government aims to achieve an eight percent economic growth target by 2029, with the financial center expected to play a significant role in attracting capital to meet this goal. The initiative is designed to be a catalyst for sustained economic growth by drawing in global capital and expertise.
