PFII Bill Officially Discussed, Government Targets Indonesia to Become an International Financial Center

Minister of Finance Purbaya Yudhi Sadewa. (Photo: ANTARA)

JAKARTA - The government together with the Indonesian House of Representatives (DPR) officially started discussing the Draft Law (RUU) on the Indonesian International Financial Center (PFII).

The regulation has entered the 2026 National Legislation Program (Prolegnas) as a government initiative proposal and the academic draft of the PFII Bill has been submitted to Commission XI of the DPR RI as a basis for further discussion.

The preparation of this regulation is an order of Article 248A of Law Number 4 of 2026 concerning Amendments to Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector (P2SK).

The government considers the establishment of PFII to be a strategic step in building a modern, competitive, and international standard financial ecosystem to strengthen the competitiveness of the national economy in the midst of global economic dynamics.

Minister of Finance Purbaya Yudhi Sadewa said the establishment of PFII is part of efforts to realize a stronger, inclusive, sustainable, and globally competitive national economy, in line with the Asta Cita program and the national development goals mandated in the 1945 Constitution of the Republic of Indonesia.

According to Purbaya, Indonesia needs a special area that is able to accommodate global financial services industry activities while increasing investment attractiveness and strengthening Indonesia's position as an international financial center.

"The establishment of the PFII is intended to increase Indonesia's competitiveness as an international financial center, the PFII is expected to be a catalyst for deepening the national financial sector, developing financial sector innovation, increasing investment, facilitating financing of the real sector, national strategic projects, sustainable financing, and strengthening the contribution of the financial sector to Indonesia's overall economic growth," he said in a working meeting with Commission XI of the Indonesian House of Representatives, Thursday, July 2.

He explained that the existence of international financial centers has become an important instrument in various countries to attract investment, expand access to financing, encourage financial sector innovation, and strengthen a country's position in the global economic value chain.

In addition, Purbaya said that international financial centers are also considered capable of mobilizing global capital more efficiently and creating high-value-added jobs.

Purbaya assessed that Indonesia has great potential to become one of the centers of international financial activity because it is supported by a large economic size, a large domestic market, a strategic geographical location, abundant natural resources, and a positive long-term economic growth outlook.

"With its large economic size, large domestic market, strategic geographical position, abundant natural resources and improved long-term growth prospects, Indonesia has all the prerequisites to develop into one of the centers of international financial activity in the Asian region and the world," said Purbaya.

In the PFII bill, the government proposes the establishment of a special area that is given a number of special characteristics to support business activities in the financial services sector, financial services supporting industries, and other economic activities that support the development of the international financial center ecosystem.

Despite having a number of special facilities, Purbaya emphasized that PFII remains an inseparable part of the territory of the Unitary State of the Republic of Indonesia (NKRI) and remains under national legal sovereignty.

"To ensure the effectiveness of the implementation of PFII, this bill forms an institutional structure, among others, to carry out the functions of implementation, management, supervision and the court," he explained.

In order to increase investment competitiveness, the PFII bill also regulates various ease of doing business, ranging from immigration facilities, employment, residency, licensing, to tax incentives and these facilities are designed to attract long-term investment while encouraging economic activities with high added value.

"This policy is expected to increase the attractiveness of Indonesia as a global investment destination, as well as increase the economic benefits received by the community and the national business world," he said.

In addition, the government proposes the establishment of a PFII Court which has special authority to handle disputes related to business activities in the PFII area as well as international commercial disputes that have a connection with the area.

The existence of a special court is expected to be able to provide legal certainty through a mechanism for resolving disputes quickly, professionally, and credibly so as to further increase investor confidence.

Purbaya emphasized that the establishment of the PFII Court was not intended to reduce national legal sovereignty, but to strengthen Indonesia's competitiveness in attracting global investment and the preparation of the provisions has also been carried out through coordination with the Supreme Court.

He is optimistic that the benefits of the establishment of PFII will not only be felt by business actors in the region, but will also have a positive impact on the national economy through increased investment, job creation, technology and knowledge transfer, human resource development, and improving Indonesia's competitiveness at the global level.

"Based on these considerations, the government hopes that the discussion of the bill on PFII can be carried out constructively to produce regulations that are able to answer the needs of Indonesia's economic development in the future," he said.