Indonesia to allow pension funds overseas investment

Jakarta (ANTARA) - Indonesia's Financial Services Authority (OJK) is preparing regulations to allow domestic pension funds to invest abroad under strict oversight to help diversify portfolios when local investment returns prove insufficient.

Speaking at the 2026 Indonesia Pension Fund Summit (IPFS) on Friday, Ogi Prastomiyono, OJK Chief Executive of Insurance, Guarantee, and Pension Fund Supervision, emphasized that offshore allocations will serve strictly as a secondary option.

"This is a safeguard in case there are no alternatives or the returns from domestic investment are not good enough," Prastomiyono said. "But this will be carried out under very strict conditions, so it will not be easy to invest abroad."

Regulators will issue baseline guidelines detailing eligible asset classes, including foreign equities, mutual funds, and fixed-income securities.

Individual fund managers will retain discretion over specific portfolio allocations.

Oversight remains a top priority following past industry governance scandals.

Investment policies for Employer-Sponsored Pension Funds (DPPK) and Financial Institution Pension Funds (DPLK) will continue to be governed by corporate statutes, while state-owned entities such as Asabri and Taspen will remain subject to Finance Ministry regulations.

To maintain real-time oversight, the OJK will deploy its digital monitoring platform, known as Prime (NBFI Securities Information and Monitoring Portal).

"We can find out where a particular pension fund is investing, who the counterparty is, what the price is, and that is monitored, including which parties are involved, including related parties," Prastomiyono explained.

Translator: Bayu, Kenzu
Editor: Aditya Eko Sigit Wicaksono
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