How to Invest in Indonesia from South Korea: Tap into Southeast Asia’s Fastest-Growing Market
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Published on October 30, 2025 · 7 min read · by Yongky Yulius

Investment Agreement

Over the past decade, South Korean investments in Indonesia have expanded rapidly—spanning from manufacturing and energy to digital startups.

This growing momentum reflects Indonesia’s position as a regional hub for innovation and economic growth.

If you’re considering joining this wave of opportunity, here’s what you need to know about how to invest in Indonesia from South Korea, including key sectors, legal structures, and practical guidance.

Why South Korean Investors Should Invest in Indonesia

Indonesia stands out as one of the most promising investment destinations in Southeast Asia.

The country combines strong economic fundamentals with a growing middle class and abundant natural resources.

For South Korean investors, Indonesia offers more than just market potential.

It also provides strategic synergy, where Korea’s advanced technology meets Indonesia’s expanding industries, creating powerful and sustainable business partnerships.

1. Indonesia’s Rapid Economic Growth

Indonesia consistently maintains a GDP growth rate above 5%, even amid global economic uncertainty.

As the largest economy in Southeast Asia, it contributes more than one-third of the region’s total GDP.

This steady performance provides a stable environment for long-term investment and business expansion.

2. Strategic Partnership Between Indonesia and South Korea

The bilateral relationship between the two countries has grown significantly over the past decade.

Since the implementation of the Indonesia–Korea Comprehensive Economic Partnership Agreement (IK-CEPA) in 2023, Korean businesses have gained new advantages.

They now enjoy reduced tariffs, simplified trade procedures, and easier access to Indonesia’s rapidly growing markets.

This agreement supports not only trade but also encourages foreign direct investment (FDI) in key sectors such as manufacturing, renewable energy, and digital technology.

3. Expanding Consumer Market

Indonesia’s population of more than 270 million people, with over half under the age of 35, creates a powerful consumer market hungry for innovation, technology, and modern lifestyle products.

Korean brands in electronics, fashion, beauty, and entertainment already enjoy strong recognition, making it easier for new investors to build trust and demand quickly.

4. Supportive Investment Policies

Through the Omnibus Law on Job Creation and the Positive Investment List, the Indonesian government has simplified licensing procedures.

It has also opened more sectors to foreign ownership and provided tax incentives for priority industries.

For Korean companies, this translates to fewer bureaucratic barriers.

It also gives them more flexibility when setting up or expanding their operations in Indonesia.

5. Growing Industrial and Infrastructure Projects

Indonesia’s focus on developing new industrial zones, smart cities, and renewable energy projects opens vast opportunities for Korean engineering, construction, and manufacturing firms.

Projects like the Batang Industrial Park, New Capital City (Nusantara), and electric vehicle (EV) ecosystem are directly aligned with Korea’s global expertise in high-tech industries.

6. Long-Term Profit Potential in an Emerging Market

While some mature markets offer slower growth, Indonesia provides higher returns with manageable risks.

Especially for investors who take a long-term view.

Sectors such as digital finance, logistics, e-commerce, and green energy are projected to expand rapidly over the next decade, giving early movers from South Korea a competitive advantage.

How to Invest in Indonesia from South Korea: Main Investment Pathways

For South Korean investors planning to expand into Indonesia, several legal and practical routes are available.

Whether through direct business ownership, joint ventures, or capital market participation, it is crucial to understand the local framework.

This ensures a smooth and compliant investment process.

1. Establish a PT PMA (Foreign-Owned Company)

The most common and effective route to invest in Indonesia from South Korea is by establishing a PT PMA (Perseroan Terbatas Penanaman Modal Asing) — Indonesia’s legal entity for foreign-owned businesses.

Key Requirements:

Minimum total investment: IDR 10 billion (around USD 650,000)
At least two shareholders (can be individuals or corporate entities)
Company registration through the Online Single Submission (OSS) system
Approval from the Ministry of Law and Human Rights

Advantages:

Full control of business operations and management
Ability to hire both local and foreign employees
Access to local financing and government incentives
Eligibility to participate in public tenders or major infrastructure projects
A PT PMA structure is ideal for Korean companies that want a long-term physical presence in Indonesia, whether in manufacturing, technology, or renewable energy sectors.

2. Form a Joint Venture with Local Partners

For Korean small and medium enterprises (SMEs) or businesses entering the market for the first time, a joint venture (JV) with a local Indonesian company can be a faster and lower-risk option.

Benefits of Joint Ventures:

Shared capital and operational costs
Easier market entry with established local networks
Faster access to business permits and distribution channels
Better cultural and regulatory alignment
Many Korean firms (especially in consumer goods, automotive, and logistics) successfully operate through JVs that balance local insight with Korean expertise and technology.

3. Participate in the Indonesian Stock Market (IDX)

If you prefer portfolio investments rather than direct business operations, another option is to invest in Indonesia through the capital market.

South Korean investors can buy shares of listed companies or Indonesian-focused funds through authorized brokers.

Ways to Invest:

Open an account with an Indonesian or international broker that provides access to the Indonesia Stock Exchange (IDX). (eg. Mirae)
Invest in major indexes like LQ45 or IDX30, which include blue-chip companies.
Consider international ETFs such as iShares MSCI Indonesia ETF (EIDO) or VanEck Indonesia Index ETF (IDX) for diversified exposure.
This route suits Korean investors seeking exposure to Indonesia’s growth potential without establishing a physical operation.

4. Invest in Property and Real Estate Projects

Although foreigners cannot directly own land under Indonesian law, they can still invest in property through legal structures or long-term leases.

Common methods include:

Purchasing apartments or offices under the Right to Use (Hak Pakai) scheme
Leasing commercial properties for up to 80 years
Investing through a PT PMA that holds property assets

Real estate in Jakarta, Bali, and Batam continues to attract Korean investors, especially for commercial, hospitality, and industrial developments.

investing in indonesia from china

Tips for South Korean Investors Entering the Indonesian Market

Investing in Indonesia offers exciting potential, but success requires more than just capital.

Here are several practical tips to help Korean investors build sustainable and profitable ventures in Indonesia:

1. Leverage Korea’s Technological Strength

Korean investors are known for innovation and efficiency. Apply these strengths to Indonesia’s emerging sectors such as digital finance, renewable energy, and smart manufacturing.

By combining Korea’s advanced technology with Indonesia’s growing market demand, you can create a strong competitive edge.

2. Build Local Partnerships Early

Local insight is crucial. Partnering with established Indonesian companies helps you navigate business culture, consumer behavior, and government regulations more effectively.

Joint ventures or strategic alliances often lead to faster market entry and smoother operations.

3. Understand the Regulatory Framework

Indonesia’s investment policies are improving, but the legal system can be complex.

Consult with local legal and financial advisors to ensure compliance with the Omnibus Law, Positive Investment List, and PT PMA regulations.

Having clear legal guidance minimizes risks and ensures smoother licensing processes.

4. Focus on Long-Term Value, Not Short-Term Gains

Indonesia’s market rewards patience. Prioritize long-term partnerships, brand trust, and local workforce development.

This approach aligns well with Korean business philosophy centered on sincerity and sustainability.

5. Adapt to Local Business Culture

Indonesian business etiquette values relationships, mutual respect, and flexibility.

Taking time to build personal rapport with partners and government stakeholders often leads to better collaboration and trust.

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For South Korean investors seeking to expand globally, knowing how to invest in Indonesia from South Korea opens the door to one of Asia’s most dynamic and fast-growing economies.

With its strategic location, young population, and pro-investment government policies, Indonesia offers fertile ground for sustainable business growth.

Opportunities range from manufacturing and real estate to technology and renewable energy.

By choosing the right investment structure, understanding local regulations, and partnering with trusted local professionals, Korean businesses can achieve long-term success in Indonesia’s vibrant market.

If you plan to establish your business presence, finding the right office space is the first step.

You can explore a variety of commercial properties and offices in Jakarta Selatan or Jakarta Pusat through Rumah123.