Indonesia's Investment Growth Continues; Danantara Urged to Expand Impact on Industry and Labor

Indonesia's investment figures remain robust, showing continued growth even as the global economy faces a projected slowdown. In 2025, investment realization reached Rp1.931 trillion, with an additional Rp1.010 trillion in the first half of 2026. These figures emerge amidst an IMF projection of global economic growth slowing to 3.0 percent in 2026.

President Prabowo Subianto has expressed hope that Danantara Indonesia will play a key role in restructuring state-owned enterprises and strengthening national investment. Danantara's involvement is already evident in 19 groundbreaking downstreaming projects and the development of a waste-to-energy national strategic project.

Doni Satria, an economic observer from Padang State University, views Danantara as strategically positioned to enhance national economic activity, including job creation. However, he stresses the importance of directing investments toward projects with sound business feasibility, strong governance, and clear links to development needs. "Danantara can drive better economic activity in Indonesia, including economic growth and job absorption, as long as its investments are well-targeted and managed carefully," Doni stated.

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Danantara can drive better economic activity in Indonesia, including economic growth and job absorption, as long as its investments are well-targeted and managed carefully.

Satria also advised that investments managed by Danantara should prioritize efficiency and returns while aligning with economic development goals. Downstreaming natural resources is seen as a promising avenue due to its scale and potential returns. Yet, he emphasized that downstreaming efforts must be complemented by strengthening supporting industries to ensure that investment benefits reach a wider range of domestic businesses. "If there is a large investment, the strategy is a large investment that also drives small industries," he added.

Feiral Rizky Batubara, Deputy Chairman for Renewable Energy Development Planning at the Indonesian Chamber of Commerce and Industry (Kadin), suggests Danantara could act as an anchor investor, fostering long-term collaborations. He argues that the success of investments should not solely be measured by financial returns but also by their ability to enhance the capacity, scale, and competitiveness of Indonesian companies. Kadin believes successful investments should create opportunities for national firms through joint ventures, co-investment, and participation in supply chains. Therefore, large-scale investments need to be interconnected with domestic industries to generate multiplier effects for local suppliers, SMEs, and the workforce.

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If there is a large investment, the strategy is a large investment that also drives small industries.