The comfortable lead Indonesia has enjoyed against its regional peers in attracting foreign investment is beginning to narrow as the competitive map shifts to quality.
Investment and Downstream Minister Rosan Roeslani, who is also CEO of state asset fund Danantara, addresses a press conference on Dec. 17, 2025, at the Presidential Palace Complex in Central Jakarta. (Antara/Cahya Sari)
For much of the past decade, Indonesia has been one of ASEAN's most recognizable investment magnets. The story is compelling: a market of 280 million consumers, a young workforce and a downstream agenda that has lifted nickel and copper into the global battery supply chain.Yet a string of recent data releases has been a reminder that the competitive map has shifted. Regional peers are quietly catching up, and the comfortable lead we have enjoyed is starting to narrow.
The first signal came from the IMD World Competitiveness Ranking 2026. Indonesia fell eight rungs from 40 to 48 out of 70 economies, among the sharpest drops globally and the deepest in ASEAN. Malaysia jumped eight positions to 15, Thailand and the Philippines each gained four, while Vietnam held firm at 27. Within ASEAN-6, Indonesia now sits at the bottom.
