Indonesia, known for its rich culture and growing economy, has become a prime destination for foreign investors, including Singaporeans looking to expand their business footprint. But what are the opportunities for Singaporeans to fully own a business in Indonesia? Let’s explore the steps and sectors where foreign ownership is possible.
Also read: Do Singaporeans Need a Visa to Indonesia?
Can a Singaporean Start and Own a Business in Indonesia?
Yes, Singaporean entrepreneurs can own a business in Indonesia, as long as the business operates in a sector that allows full foreign ownership. The Indonesian government categorizes business sectors under the Positive Investment List (Daftar Positif Investasi or DPI) and the Negative Investment List (Daftar Negatif Investasi or DNI).
- Positive Investment List (DPI): The Positive Investment List outlines business sectors fully open to foreign investors, promoting economic growth through foreign ownership.
- Negative Investment List (DNI): On the other hand, the Negative Investment List outlines sectors where foreign investment is restricted or subject to certain conditions.
Also read: Can a Foreigner Own 100% of a Business in Indonesia?
Indonesian Business Sectors Open to 100% Foreign Ownership
According to the Positive Investment List, several sectors in Indonesia are open to 100% foreign ownership for Singaporean entrepreneurs, including:
- Agriculture: Cultivation of crops, livestock farming, and aquaculture.
- Manufacturing: Production of textiles, electronics, and more.
- Tourism: Operation of hotels, resorts, and tourism services.
- Telecommunications: Internet and mobile services.
- Financial Services: Banking, insurance, and other financial offerings.
- Healthcare: Running hospitals, clinics, and related services.
These sectors offer excellent growth opportunities, with Indonesia welcoming foreign investors to contribute to its vibrant economy.
Also read: Top Foreign Investment Sectors in Indonesia
Sectors with Conditional Foreign Investment
However, not all sectors are fully open to foreign investment. Certain industries, such as mining, oil and gas, real estate, and retail, may have conditions such as:
- Minimum investment amounts.
- Requirement of local partners.
- Export or technology transfer requirements.
These conditions can vary depending on the sector, so it’s essential to check with the Indonesian Investment Coordinating Board (BKPM) for up-to-date regulations. (You can consult with us!)
Also read: Top Foreign Investors in Indonesia (by Country and Continent)
Establishing a Business in Indonesia for Singaporeans
There are two main ways for Singaporeans to set up a business in Indonesia:
- PT PMA (Penanaman Modal Asing) – A limited liability company that allows full or partial foreign ownership.
- PMA Representative Office – An office representing a foreign company’s interests in Indonesia but unable to generate profits.
Also read: Corporate and Company Structure in Indonesia: Complete Guide
To establish a PT PMA, Singaporean entrepreneurs need to:
- Have a minimum paid-up capital of IDR 10 billion (around SGD 900,000).
- You must appoint at least two directors, including one who is required to be an Indonesian citizen.
- Obtain approval from the BKPM.
For a PMA Representative Office, requirements are simpler, such as having a registered office in Indonesia and appointing an Indonesian citizen as a representative.
Indonesia offers lucrative business opportunities for Singaporean entrepreneurs in sectors such as agriculture, manufacturing, and tourism. With the right guidance, setting up a fully-owned business in Indonesia can be straightforward. Whether you choose to register a PT PMA or a representative office, understanding the regulations and investment lists is essential.
For expert assistance in company registration in Indonesia, reach out to professionals who can guide you through the process smoothly. You can rely on InvestinAsia’s Indonesia PMA company registration and Indonesia Representative Office Set Up services to simplify the process.
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