The Health Sector

Indonesia’s healthcare industry is a very advantageous investment opportunity for foreign investors due to the rapid growth of it’s middle-class and the introduction of universal healthcare. Indonesia introduced its universal healthcare program, the JKN, in 2014, and has grown into the largest in the world, covering more than 200 million people. Meanwhile, the pharmaceutical industry has grown annually between 10-13% due to the rise of national health insurance. Indonesia’s pharmaceutical industry is ASEAN’s largest, recording more than US$9 billion in sales in 2019 and expected to reach $10 billion by 2021.

Alongside the growth in Indonesia’s health sector, the government released a new Investment List in March 2021, under Presidential Regulation No.10 regarding investment sectors. The New Investment List significantly relaxes the previous restrictions on foreign investment. In terms of some of the significant changes from the old investment restrictions, here are a few:

  • Pharmaceutical Manufacturing is no longer subject to 85% maximum foreign ownership, instead is open for 100% foreign ownership
  • Pharmaceutical Wholesaler and Raw Pharmaceutical Wholesaler is no longer closed for foreign ownership, and is instead open to 100% foreign ownership
  • Hospitals are no longer subject to a maximum 67% foreign ownership, but are instead now open for 100% foreign ownership, however, subject to a minimum number of beds.