Jakarta Targets offshore โFunds with New Trust โRules
JAKARTA: Indonesia is preparing to introduce regulations in 2025 establishing trustee institutionsโ and special-purpose โฃvehicles, aiming to attract โขboth โdomestic and international investment and spurโ economic growth. The initiative will also enableโ state fund Danantara to establish a trustโ fund for onshore โขcapital.
Masyita Crystallin, Directorโ General of Financial Sector Stability and Progress at the Finance Ministry, highlighted โthe โlong-awaited nature of thisโข framework for investors. She noted โขthe plan aligns โฃwithโฃ President Prabowo Subianto’s focus on increasing capital inflows and bolstering domestic investment.
Currently,Indonesia’s civil law system lacks the โคlegal structures common inโ common-law โฃjurisdictions that โallow โfor assets โฃto be held and managed by a trustee. the new regulations, stemming from โขthe 2023 financial sector law,โ will introduce concepts like the separation ofโข legal and beneficial ownership, and “bankruptcy remoteness” – protecting assets from the insolvency of trustees or managers.
The move is โขpart of a broader strategy to mobilize capital within โขIndonesia and โขdeepen โฃfinancialโ markets,specifically targeting funds currentlyโ heldโ offshore,particularly in Singapore.These funds are frequently enough attracted toโข Singapore’s stronger legal protections and established trust structures.
Danantara, Indonesia’s sovereign wealth fund, intends to leverage the new framework toโค createโค a โtrust fund managing approximately US$1 billionโ over the next five years.โ Potential collaboration opportunities with organizations like the Gates Foundationโค in areas such as education, health,โข and poverty alleviation have been identified.
Masyita, โ44, leads the directorate established โin june to โขoversee the โstability and development of Indonesia’s financial system. Her team isโ currently finalizing numerous regulations derived from the 2023โ financialโข sector law. the government is also working on rules to โขdemutualize โฃthe Indonesian stock โคexchange, transitioning it into a corporation open to โคa wider range of investors.
“We oversee the entire financial sector chain at a macro level,” โMasyita stated, emphasizing the importance of ensuring sufficient financing resources, appropriate instruments, and regulations that can adapt to the rapidly evolving global financial landscape.