AmCham Update Vol. 7 #073

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Jul 13, 2026

Top Anti-Corruption Prosecutor now a Corruption Suspect

In a stunning fall from grace, former Deputy Attorney General for Special Crimes Febrie Adriansyah, the top anti-corruption prosecutor for the Attorney General’s Office (AGO), was named a suspect in related corruption and money laundering investigations on July 11 by the National Police Anti-Corruption Corps. Febrie resigned the same day from the position he had held since 2021.

The cases have since been transferred to the AGO for prosecution, while a skeptical House of Representatives (DPR) established a monitoring team to oversee the proceedings. A second suspect has been identified as Don Ritto, a lawyer and friend of Febrie’s, according to Tempo.

The police said the investigation involves alleged corruption linked to state-owned insurer Asabri, coal procurement for the State Electricity Company (PLN), and debt settlement involving a subsidiary of Krakatau Steel.

During a joint press conference with the AGO and DPR Commission III, the head of the police anti-corruption unit, Inspector General Totok Suharyanto, said investigators had questioned 15 witnesses and two experts before naming the two suspects.

“Following a case review, we named two suspects: DR [Don Ritto], a private individual suspected of money laundering, and FA [Febrie], the former assistant attorney general for special crimes, on suspicion of corruption and money laundering related to the handling of the Asabri case and other corruption investigations,” Totok said in a press conference on July 11.

The naming of the suspects follows coordinated police raids that included the posh de’CLAN Signature café in Cipete, where a concealed steel safe was found containing nearly Rp 60 billion in cash. At a residence in Sentul, investigators found 74 kilograms of gold bars, $4.77 million, SG$ 14.08 million, and Rp 100 million in cash, with an estimated total value of Rp 476 billion.

The raids also drew the attention of the Indonesian Military (TNI), and soldiers briefly deployed to protect Febrie’s residence before withdrawing.

Police believe corruption in the coal trade contributed to widespread electricity blackouts across parts of Sumatra, Kalimantan and Java that caused state losses of Rp 5 trillion (US$276 million).

AGO officials said the cases have been transferred to the AGO’s Special Crimes Division, Febrie’s former office, which is being led on an interim basis by Deputy Attorney General for Supervision Rudi Margono, a move that was promptly questioned by the DPR.

DPR Commission III established a special working group to monitor the investigation and prosecution, with Chairman Habiburokhman of the Gerindra Party calling on the AGO to appoint an independent prosecutorial team with no affiliation to the suspects.

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Gov’t Touts Massive Upside for Indonesia International Financial Center

Despite wading into uncharted waters, the proposed Indonesia International Financial Center (PFII) will attract between Rp 300 trillion and Rp 500 trillion ($27.79 billion) in investment, according to the Finance Ministry’s financial sector stability and development director general, Herman Saherudin, speaking on July 8.

“The potential investment could be in the form of setting up new branches of foreign banks or new business entities," Herman said.

“It depends on our assumption, because we’re competing with Singapore, Dubai and others,” Herman said after a hearing on the PFII bill with DPR Commission XI.

The PFII will draw large sums because it will not limit foreign ownership, Herman said, unlike current regulations that cap foreign holdings in many areas of business.

In a separate hearing, Financial Services Authority (OJK) chief executive for banking supervision Dian Ediana Rae underscored the importance of not “crowding out” domestic financial services.

“Financial service activities inside the PFII have to remain oriented toward international financial activity and not become a competitor of domestic financial services,” Dian said.

Representatives of the OJK and Bank Indonesia (BI) also told the hearing that the PFII may entail systemic risks due to deeper linkages with the international financial system.

Herman said capital for the center would not come from the state budget, and that Indonesia would still adhere to international agreements, such as the global minimum tax of 15 percent on corporate profits of multinationals.

The DPR plans to pass the bill this month and start executing the plan by the end of the year.

Economist Intelligence Unit (EIU) Asia analyst Tay Qi Hang said on July 10 that the Rp 300-500 trillion inflow was not realistic in the near-term.

“It could be achievable over several years if the number includes broad commitments, asset registrations, domestic capital relocation and real estate or infrastructure investment, but it looks ambitious if interpreted as fresh foreign capital inflows into Indonesia’s financial sector,” Tay told The Jakarta Post.

“It is more likely to work as an Indonesia-linked financing platform than as a full regional financial hub competing head on with Singapore,” said Tay... “It is unlikely to become a major international financial center unless Indonesia can prove sustained legal predictability, regulatory independence and credible dispute resolution over several years.”

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Indonesia Wants to Double Data Center Capacity with Foreign Investment

The government is seeking investments from global technology companies, including chip giant Nvidia, to expand Indonesia’s data center capacity as part of a broader push to strengthen the country’s AI and digital infrastructure.

Coordinating Minister for Economic Affairs Airlangga Hartarto said Indonesia plans to develop around 1.3 gigawatts (GW) of new data center capacity – more than double the country’s existing operational capacity of approximately 580 megawatts (MW) – requiring an estimated $15-20 billion in investment.

Nvidia is expected to participate through a partnership with Australia, though Airlangga did not disclose the company’s investment numbers nor the specific Australian company in question. Nvidia has not confirmed its participation.

Australia’s Firmus Technologies recently announced a strategic partnership with Nvidia that includes a 360-megawatt AI factory in Batam.

State-owned telecommunications company Telkom Indonesia and several global technology firms are also preparing to expand data center facilities in Karawang, West Java, as demand for AI infrastructure grows.

"Nearly all major global technology companies are planning to expand their data center investments in Karawang because data centers have become critical infrastructure for AI development," Airlangga told reporters on July 10.

Beyond infrastructure, Airlangga said Indonesia is partnering with British semiconductor designer Arm Ltd to strengthen the country's digital ecosystem by integrating around 15,000 Indonesian engineers into Arm's global network, supporting President Prabowo Subianto’s directive to build domestic digital capabilities through human capital development.

To support the growing electricity demand from AI and data centers, the government is also accelerating its 100-GW solar power development program, which Airlangga said would provide clean energy while creating new investment opportunities across the country.

Separately, Coordinating Ministry for Economic Affairs Secretary Susiwijono Moegiarso said UAE-based Damac Digital is preparing to invest in a large-scale data center project with a planned capacity of 1.2 GW to 1.3 GW across three locations in Indonesia, although the facilities will not be located within the Nongsa Digital Park Special Economic Zone in Batam.

Susiwijono added that ensuring reliable electricity and water supplies would be critical to attracting long-term investment, given the substantial infrastructure requirements of large-scale data centers.

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Pertamina Ready for CNG Rollout

State-owned Pertamina Gas (Pertagas) says it is ready to support the government program to use compressed natural gas (CNG) as an alternative to expensive liquefied petroleum gas (LPG).

Pertagas has both the natural gas pipelines and strategic compression facilities to help secure the distribution of CNG to various regions, the company says.

Corporate Secretary Sultani Adil Mangatur said on July 7 that the company can do the job but that the regulation and implementation of the CNG policy is entirely in the hands of the government.

"The first part of the Pertamina gas subholding is as an energy infrastructure company with a number of natural gas pipelines,” said Sulthani.

The company’s operational capabilities are not limited to gas transmission pipes, Sulthani said, the group also manages natural gas compression stations that play a crucial role in the gas processing supply chain into CNG.

The push for CNG comes from President Prabowo Subianto’s desire to reduce dependence on LPG imports. The president has said CNG is already a reality in some regions including parts of Central Java.

Meanwhile, manufacturers are warning that the government's promise to cut the price of LNG for industry may fall prey to fuel scarcity and declining production.

Energy Minister Bahlil Lahadalia ordered prices cut for industrial consumers from $23 to $13 per metric million British thermal unit (MMBtu), effective June 29.

The price cut was done by shrinking margins from upstream to downstream, and is intended to provide cost relief for domestic manufacturers. Yet industry players say this means little without guaranteed access to supplies.

"What needs to be clarified is this: The $13 gas is not a new supply but rather a new price for the same product," said Ahmad Zuhdi Dwi Kusuma, associate principal at the Energy Shift Institute. "Lowering prices is a matter of policymaking; increasing volume is a different challenge entirely."

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Home Minister Orders Regional Belt-Tightening to Avoid Contract Worker Layoffs

Home Affairs Minister Tito Karnavian has instructed regional administrations not to lay-off Government Employees with Work Agreements (PPPK) despite mounting fiscal pressure, saying local governments must first cut non-essential spending. As of this writing, the government employs around 1.5 million workers under PPPK arrangements.

"It would only increase unemployment," Tito said of possible layoffs on July 9. He urged regional leaders to reduce spending on official travel, meetings, catering and other non-priority items.

The Home Affairs Ministry has deployed teams to assess whether regional governments have implemented sufficient efficiency measures. If fiscal difficulties persist, Home Affairs will review whether regions have undisbursed revenue-sharing funds (DBH) and may recommend priority disbursements to the Finance Ministry.

The directive followed a proposal by the Tidore Islands administration in North Maluku to furlough around 2,000 PPPK employees because of budget constraints, prompting protests from workers. The city later withdrew the plan and instead cut additional performance allowances for civil servants and PPPK employees by 30 percent.

Similar pressures have emerged elsewhere. Around 3,000 PPPK employees in Aceh have yet to receive their July salaries and 13th-month (THR) payments, while West Sulawesi officials warned it may lay off more than 2,000 PPPK employees by 2027.

Herman Suparman, Executive Director of Regional Autonomy Watch (KPPOD), said local governments have limited room for further cuts and called for higher central government transfers through a revision of the 2026 state budget.

"Regional administrations have been implementing efficiency measures for the past one and a half years, leaving little left to cut. DBH is the regions' right, and there should be no debate about it," he told The Jakarta Post on July 10.

Disbursements to regional governments have been cut sharply to accommodate President Prabowo Subianto's flagship programs including Free Nutritious Meals and Red and White Cooperatives, reducing total regional transfers from Rp 869 trillion to Rp 693 trillion. Last year, DBH allocations were cut by nearly 70 percent, while some payments dating back to 2023 remain undisbursed.

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Breakfast Seminar in Singapore – Managing Indonesia Risk and Liability

SSEK Law Firm is co-hosting a breakfast seminar in Singapore with Eversheds Sutherland and GT Law LLC on Wednesday, 29 July 2026, on the topic

“From Corporate Risk to Corporate Crime – Managing Indonesia Risk and Liability from a Global MNC Perspective”

The session will explore the evolving regulatory landscape in Indonesia and its implications for multinational businesses with regional headquarters, investment structures or operations in Indonesia.

Get to Know Our Member | IFF INDONESIA (PT Essence Indonesia and PT IFF Indonesia)

International Flavors & Fragrances Inc. (IFF) is a global leader in specialty ingredients, serving customers across the food and beverage, health, beauty, personal care, and home care industries. Headquartered in New York, IFF combines science, innovation, and consumer insights to develop solutions that enhance product quality, functionality, and sustainability.

The company operates through three core business segments: Taste, Scent, and Health & Biosciences, integrating flavor creation, fragrance development, and biotechnology expertise. Its portfolio includes flavors, fragrances, functional nutrition, clean-label ingredients, cultures, enzymes, and other specialty solutions that support product innovation and differentiation.

In Indonesia, IFF operates through PT Essence Indonesia and PT IFF Indonesia, IFF’s manufacturing operations in Karawang support the company’s sustainability goals by reducing waste, energy use, water consumption, and greenhouse gas emissions.

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Update is AmCham’s regular newsletter on developments related to investment, the economy, regulations and issues related to doing business in Indonesia. It comes out three times a week. It is edited by AmCham Managing Director Donna Priadi and written by the AmCham Staff.

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