Indonesian President Joko Widodo held a closed meeting with Minister of Tourism and Creative Economy Sandiaga Uno, Minister of Investment Bahlil Lahadalia, and Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Panjaitan, as well as the Financial and Development Supervisory Agency Muhammad Yusuf Ateh, Deputy Minister of Finance Suahasil Nazara, and Chairman of the Board of Commissioners of the Financial Services Authority Mahendra Siregar.
Sandiaga said that in essence the government will review the family office wealth management service, a financial cluster that provides easy services for large families to invest their funds in Indonesia. Indonesia is targeting to be able to attract additional funds of around US$ 500 billion.
“Earlier, it was considered in terms of potential, and a special team will be formed to study this and it is hoped that we can offer something (services) like Singapore, Dubai, Hong Kong, there is an attraction from family-based fund management in Indonesia,” said Sandi when met at the Merdeka Palace complex, Jakarta, Monday (1/7).
From the presentation of the potential picture, the total world family office community reached US$11.7 trillion in managed funds. According to him, if Indonesia might attract just 5% of the total managed funds of the world family office community, then around US$500 billion would be able to enter Indonesia in the next few years.
“US$500 billion is quite large in the next few years,” said Sandi.
Form a Study Team
Therefore, the government, in this case the Coordinating Ministry for Maritime Affairs and Investment will form a study team, reviewing from the regulatory aspect and from the aspect of Indonesia’s readiness, which will be reviewed across sectors. He emphasized that this family office will be an additional opportunity, additional funds are not a necessity.
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“This is an opportunity, it will be studied across sectors and this will be an additional opportunity, additional funds are not a necessity. So we can launch it to get a lot of funds managed by family offices,” said Sandiaga.
From the limited meeting, said Sandiaga, the regulation issue was reviewed, and he said the Indonesian Capital City (IKN) already has it (regulations for fund management). But the one that gets a lot of requests from the world office family community, he said, is Bali.
“Later, how we respond to this will be done through a study in the next month,” said Sandi.
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Until today, he said there were no challenges in its implementation, because according to him it only needed regulatory adjustments.
“Because we already have and Indonesia’s current attractiveness is not only in financial assets but also in other assets, direct investment assets, as well as green investment and philanthropic activities,” said Sandi.
Sandiaga sees it, the existence of family ownership in Indonesia until today is quite a lot. So the existence of family offices in Indonesia will be an opportunity.
So far, many Indonesian family offices have placed their money management outside Indonesia.
“So if we call it low hanging fruits. So the quick wins are companies owned by Indonesian families to manage their investments not outside Indonesia but in Indonesia,” said Sandiaga. (Z-3)
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