Indonesia Country Summary

FATF Status

Indonesia was removed from the FATF List of Countries that have been identified as having strategic AML deficiencies on 26 June 2015.

Compliance with FATF Recommendations

The last follow- up Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Indonesia was undertaken in 2025. According to that Evaluation, Indonesia was deemed Compliant for 6 and Largely Compliant for 30 of the FATF 40 Recommendations. It remains Highly Effective for 0 and Substantially Effective for 4 of the Effectiveness & Technical Compliance ratings.

Crime and corruption in Indonesia remain significant challenges that hinder investment and governance across various sectors. Despite the establishment of anti-corruption bodies like the Corruption Eradication Commission (KPK), recent legislative changes have undermined their independence, leading to a decline in public trust and effectiveness in combating corruption, particularly among political figures. Human trafficking, illegal logging, and drug trafficking are prevalent issues, exacerbated by weak law enforcement and the involvement of organized crime networks that often collaborate with state actors. While the government is making efforts to enhance economic competitiveness and address corruption, the resilience of civil society is under threat, with increasing attacks on journalists and human rights defenders limiting their ability to advocate for accountability and transparency.

Indonesia presents a compelling investment landscape characterized by a large population of 283 million and a stable economy valued at $1.4 trillion, bolstered by a growing middle class and rich natural resources. The government has enacted reforms, notably the 2020 Omnibus Law on Job Creation, aimed at enhancing competitiveness by reducing corporate taxes and regulatory barriers, although challenges such as bureaucratic inefficiencies, legal uncertainties, and corruption persist. Despite these hurdles, foreign investment remains robust, particularly in sectors like digital technology and renewable energy, with Indonesia's strategic initiatives to "downstream" its natural resources and expand infrastructure further enhancing its appeal as a destination for U.S. investors.