Representatives from major local business lobby groups, congressmen and academics have expressed concerns about foreign investment in Indonesia’s startups, citing the risk of capital flight from the country and locals being disadvantaged by foreign IT talent.
Fearing that foreign-owned startups which repatriate their earnings overseas would cause a loss of national income, Bhima Yudhistira from Indonesia’s Institute for Development of Economics and Finance has advocated a 40% foreign ownership cap on startups, and calls for the restriction of mergers or acquisitions that would result in monopolies or unfair competition.
The deputy head of KADIN (Indonesian Chamber of Commerce), Johnny Darmawan, has similarly cautioned against majority foreign ownership in startups. He laments unclear regulations on ownership that have encouraged the influx of foreign investors only interested in acquiring consumer databases from Indonesia’s vast market.
Ecky Mucharam, a member of the House of Representatives, separately has warned about various issues, including foreign ownership and the influx of imported products in e-commerce marketplaces. “Once again,