Indonesia’s Flourishing Special Economic Zones: A Canvas of Growth
By Vietnam News Agency
Wed, September 10, 2025 | 9:20 pm GMT+7
Indonesia is on a remarkable path to economic growth, with its special economic zones (SEZs) playing a pivotal role. Over the past five years, the nation has successfully attracted an impressive $18.63 billion in investments, significantly contributing to job creation and economic diversification. This surge, highlighted by the Coordinating Ministry for Economic Affairs, has generated over 187,000 jobs, marking a substantial boost to the Indonesian economy.
Mid-Year Achievements in 2025
The momentum continued into 2025, with investment realization in the first half alone reaching $2.56 billion. This figure represents a notable 48.2% of the annual target, demonstrating strong investor confidence. During this period, Indonesia witnessed the emergence of 28,094 new job opportunities alongside attracting 65 businesses to set up operations in SEZs, as stated by Secretary Susiwijono Moegiarso during a recent press briefing.
The Scope of Indonesia’s Special Economic Zones
Currently, Indonesia boasts 25 SEZs, with an impressive 18 located outside the island of Java. Out of these, 13 are specifically geared towards industrial activities, while 12 focus on service-based businesses. Among the frontrunners in attracting investments are Kendal, Gresik, and Galang Batang, testament to their strategic positions and favorable business environments.
Sectoral Investments and Future Prospects
The bulk of investment inflow into SEZs has primarily been directed toward the processing and manufacturing sectors. However, burgeoning interest in education, healthcare, and the digital economy also signals a diversification of investment interests. As these sectors continue to grow, they promise to contribute substantially to both the job market and national economic development.
Export Contributions
SEZs have also made significant contributions to Indonesia’s export portfolio. Between 2021 and mid-2025, exports from these zones reached a staggering IDR 82 trillion (approximately $5.19 billion). The most notable contributors include Galang Batang, known for alumina production, Kendal, specializing in battery anodes, and Gresik, which focuses on copper.
Understanding the Competitive Landscape
Rizal Edwin, Secretary-General of the National Council for Special Economic Zones, pointed out that Indonesia’s 25 SEZs, while impactful, are still modest compared to their counterparts in other ASEAN nations like Malaysia and Vietnam. This underscores the need for enhanced incentives to diversify sectors and attract a broader array of investors.
Government Initiatives and Future Directions
The government is unwavering in its commitment to enhancing the SEZ landscape, especially focusing on healthcare and digital education. These initiatives aim not only to attract investment and foster job creation but also to ensure that Indonesia’s GDP benefits substantially from these economic clusters.
Strengthening Regional Cooperation
Rizal further emphasized the potential for deeper synergies between Indonesia and Vietnam, pointing out that both countries share similar export products but are not direct competitors. Instead, there lies a golden opportunity for collaboration in developing mutual markets, particularly through joint efforts in SEZs. Such cooperation could yield dual benefits, bolstering economic growth for both nations.
In summary, Indonesia’s strategic investments in its special economic zones reveal a blueprint for successful economic management and regional cooperation. As the country continues on this path, it stands poised for sustained growth, resilience, and integration into the regional and global markets, marking a significant milestone in its economic journey.