Indonesia is a vast archipelagic state with a population of 278 million people making it the world’s 4th most populous nation. It has the 16th largest economy in the world, and the 7th largest economy in Asia! Despite those impressive numbers, Indonesia somehow still hasn’t achieved the star status of its regional competitors like Singapore and Thailand when it comes to foreign companies setting up operations there!
Indonesia has much to recommend it when it comes to commerce, with multiple free trade agreements, and a thriving marketplace and manufacturing industry, it’s the perfect place to establish a business. It is highly recommended that foreign companies avail themselves of the expert services of a local accounting firm in Indonesia that knows all the ins and outs of the nation’s business practices and tax laws. The following are just some of the advantages to doing business in this thriving economic powerhouse!
Free Trade Agreements – Indonesia is a member of ASEAN, the Association of Southeast Asian Nations, which includes Brunei, Cambodia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam. This membership allows Indonesian businesses to trade with those countries at a very low, or in some cases, zero tax rate. Just by trading in ASEAN countries alone, you will have access to a population of more than 668 million people! In addition, ASEAN membership also gives Indonesia lucrative trading access to India, New Zealand, Australia, China, South Korea and Japan.
Indonesia is also a signatory to CEPA, the Comprehensive Economic Partnership Agreement which is associated with the European Free Trade Association, or EFTA. This agreement includes trade in goods, trade in services, investment, government procurement, intellectual property rights, digital technology, and sustainable development, and technical barriers to trade measures, all of which can be of tremendous benefit to any Indonesian registered company.
Foreigners Are Able To Own Land – This has often proven to be a barrier in some countries, but not so in Indonesia where foreign investors are able to legally own land and property. There are three basic rights associated with owning land and property in Indonesia, which are as follows:
- The Right To Build – Foreigners can build on their land.
- The Right To Cultivate – Foreigners can cultivate crops on their land.
- The Right To Use – Foreigners can develop their land and sell or exchange it.
English Is Commonly Spoken – Indonesia is a large nation that is home to a wide variety of ethnic groups speaking more than 300 languages. The country’s main official language is Bahasa Indonesia, but businesses in major cities like Jakarta commonly use English for communication.
Strong Anti Corruption Policies – In the past, corruption was a major problem in Indonesia, but thanks to a stern government crackdown operated by the Corruption Eradication Commission, which has broad and far-reaching powers to combat the scourge, it has been mostly negated. Signing the United Nations Convention Against Corruption and the National Strategy of Corruption Prevention and Eradication of 2012-2025 are further steps Indonesia has taken to present a more transparent economy.
Considering all of these remarkable perks, Indonesia is truly a great place to do business!