Ikhsan Reliubun, Jakarta – A senior economist from the University of Indonesia (UI) Faisal Basri said he's skeptical that the global ultrarich would deposit their funds in Indonesia, in response to the government's plan to establish a family office in the country.

"Stop daydreaming," said Faisal, in West Jakarta on Tuesday, July 9, 2024.

According to him, the government must first be able to make people trust the country first before asking them to place their funds in Indonesia. They must feel safe, comfortable, and confident that their funds will grow if kept in the state.

Faisal said that even rich Indonesians feel safer depositing their money overseas. "Indonesians store their money abroad now," he said, noting that many affluent people in Indonesia prefer to store their assets in Hong Kong and Singapore.

"How do you expect foreigners to believe in storing their assets in Indonesia, while its own citizens don't even believe in it," he added.

The Coordinating Minister for Maritime and Investment Affairs Luhut Binsar Pandjaitan first brought forth the plan to establish a family office in Indonesia. President Joko Widodo or Jokowi has approved and summoned several ministers and officials to discuss the formation scheme.

Luhut stated that he was currently preparing an integrated regulation regarding family offices. One of the provisions will rule that family offices will not be taxed but people are required to invest in Indonesia, which will then be taxed.

Source: https://en.tempo.co/read/1889610/senior-economist-on-govt-family-office-plan-stop-daydreamin