Passed! Parliament Ratifies the IIFC Draft Law into a Law
JAKARTA, DDTCNews - The House of Representatives (Dewan Perwakilan Rakyat/DPR in Indonesian) has officially enacted the Draft Law on the Indonesian International Financial Centre (IIFC) into a law.
Members of the House heard the report of the chairperson of the working committee (panitia kerja/panja in Indonesian) for drafting the IIFC Draft Law, who also serves as Deputy Chairperson of House Commission XI, Mohamad Hekal. All parliamentary factions and members subsequently approved the substance of the legal framework and agreed to ratify the IIFC Draft Law into a law.
"Can the Draft Law on the Indonesian International Financial Centre be approved to become a law? Agreed, thank you," said House Speaker Puan Maharani, striking the gavel after hearing the approval of all factions and members of the House at the plenary session on Tuesday (21/7/2026).
On the same occasion, Minister of Finance, Purbaya Yudhi Sadewa, stated that the IIFC Draft Law was drafted as the legal foundation for establishing a credible, independent and integrity-driven financial centre in Indonesia that is globally competitive.
In his view, the construction of a financial centre is of great importance, given that Indonesia occupies a strategic position as the largest country in South-East Asia and a member of the G20.
Further, he considered the construction of a financial centre to be a priority for attracting global investors, strengthening economic resilience and diversifying sources of development financing as well as consolidating Indonesia's position as an emerging economic powerhouse on the international stage.
"The presence of the IIFC is not intended to replace the existing domestic financial system, but rather to complement it with a world-class, integrated ecosystem," said Purbaya.
To achieve these objectives, Purbaya noted that the IIFC Law is built on three main pillars. The first pillar is stated capital access and investment. Indonesia's financial centre is intended to attract sustainable inflows of foreign capital and quality portfolio investment as a source of long-term financing.
These efforts are expected to expand the scale of the national economy, thereby accelerating economic growth towards 8%. In doing so, the state will derive a number of positive benefits, including faster development progress, the establishment of a new tax basis and job creation.
"This will generate substantial long-term benefits for national development across all regions of Indonesia. A new tax basis will also be established and new jobs will be generated as a multiplier effect from the availability of new long-term international financing sources for equitable national development," he explained.
The second pillar is innovation and governance. The financial centre will establish a comprehensive financial services ecosystem, utilising advanced technology, world-class cybersecurity systems and sound governance.
Purbaya added that the IIFC will provide legal certainty for investors and entrepreneurs through the establishment of an IIFC court and an arbitration institution. These legal bodies are expected to operate efficiently, consistently and independently, with a focus on certainty and fairness for entrepreneurs, whilst remaining anchored to the sovereignty of the Indonesian legal system.
The third pillar is the strengthening of competitiveness and national human resource capacity. According to Purbaya, the establishment of a financial centre will drive job creation for highly skilled human resources as well as the transfer of technology and knowledge in the field of finance. In the long term, these efforts can reduce the cost of capital and enhance the competitiveness of the national economy.
"The IIFC Draft Law is not merely a formal regulation. Rather, it is a new architecture for the future of Indonesian finance. This is a shared commitment between the House and the Government to affirm Indonesia's position as a principal pillar of the global economy," concluded Purbaya. (dik)
