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ASEAN Connected: Indonesia Business Guide

ASEAN Connected: Indonesia Business Guide

Indonesia continues to implement measures to open up the archipelago to foreign investment, including removing sectors from its negative investment list. Consequently, foreign direct investment (FDI) flows continue to grow; FDI into Indonesia increased by 19.2 per cent year-on-year to IDR365.9 trillion in 2015.

Indonesia ranked 109th in the World Bank's 2016 Doing Business rankings, rising from 120th in the year prior. The rankings recognised a number of reforms enacted to make doing business easier. Indonesia made starting a business in Jakarta easier by reducing the time needed to register with the Ministry of Manpower. It also improved access to credit by enabling searches of the collateral registry by the debtor’s name.

Paying taxes became easier and less costly through the introduction of an online system for paying social security contributions and a reduction of both the rate paid by employers and the ceiling for the contributions.

Key facts about starting a business in Indonesia:

It takes 13 procedures and approximately 46.5 days to start a new business in Indonesia; this process is detailed in the Doing Business in chapter
  • Obtaining a limited stay visa to be able to work in Indonesia takes around one month; employment regulations are discussed in detail in the Labour chapter
  • Requesting and obtaining a building construction permit takes approximately 42 days and costs IDR68,281,500
  • All Indonesian incorporated entities must prepare statutory financial statements in accordance with the Indonesian Accounting Standards (SAK); further details can be found in the Audit chapter
  • Companies that wish to list securities on the IDX must, amongst other conditions, have engaged in their core business for at least 36 consecutive months at the date of application; this is discussed further in the Finance chapter
The HSBC guide has been developed to provide businesses with an overview of Indonesia, its legal regime, start-up and market entry considerations, tax and customs requirements and a general summary of the factors that may affect the decision to do business in Indonesia. However, the information contained in this document is generic in nature and you should not act or rely on it without obtaining specific professional advice.

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Dee-Ann Prather, Down Under Enterprises International
NSW Women in Global Business Award winner
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