AmCham Update Vol. 7 #074

Febrie Corruption Case puts Heat on AGO, DPR Says Asset Forfeiture Bill Moving Ahead, S&P Affirms Indonesia’s Investment-Grade Rating, Producers Must Finance Plastic Waste Handling, B50 puts Spotlight on Raising CPO Production

Jul 15, 2026

AGO Under Pressure over Febrie Corruption Case

The Attorney General's Office (AGO) faces mounting scrutiny over its handling of the corruption investigation involving former Deputy Attorney General for Special Crimes Febrie Adriansyah after the case was transferred by the police to the AGO’s Special Crimes section, Febrie’s former office.

Febrie has not been seen in public after he resigned and was named a suspect on July 11 in three alleged corruption cases linked to Asabri and Asuransi Jiwasraya, Krakatau Steel, and coal procurement for the State Electricity Company (PLN).

Police raids between July 8 and 10 led to the seizure of assets from Febrie's Sentul residence and other locations. The haul includes 74 kilograms of gold bars and foreign currency with an estimated value of Rp 476 billion ($26.3 million). Police said the assets are suspected proceeds of corruption.

The case focused public attention on a supposed rift between the police and the AGO and prompted a public relation offensive to put a better face on the relationship. National Police Chief General Listyo Sigit Prabowo met Attorney General Sanitiar Burhanuddin following the case transfer, and both denied any institutional tensions.

"I and the National Police chief are not rivals or at odds with each other," Burhanuddin said on July 13. Listyo added, "The AGO and the police are one big family. We will continue ensuring that synergy in this family is maintained."

AGO spokesperson Anang Supriatna said prosecutors will establish a dedicated team to minimize conflicts of interest and involve the Corruption Eradication Commission (KPK) in a supervisory role. "We will be professional, and we will also involve supervision from the KPK," Anang told reporters on July 13.

Although lawyer Don Ritto, a longtime associate of Febrie’s, was declared a suspect and detained, Febrie was not arrested. Acting Deputy Attorney General for Special Crimes Rudi Margono said prosecutors must first examine the case files and evidence transferred by police, a position some legal experts challenged.

Immigration authorities have barred both suspects from leaving Indonesia for 20 days, while the AGO said it is also examining information regarding the possible existence of additional spaces linked to Febrie as part of the investigation.

Meanwhile, House of Representatives Commission III Chairman Habiburokhman of the Gerindra Party reiterated calls for the AGO to appoint an independent prosecutorial team without links to the suspects to safeguard the credibility and impartiality of the investigation.

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DPR Leaders Say Asset Forfeiture Bill will Move Forward

The leadership of the House of Representatives (DPR) is insisting that a long-delayed Asset Forfeiture Bill is moving ahead, despite widespread skepticism.

As evidence, leaders point to two public hearings held by House Commission III on July 13 that invited representatives from two bar associations and a student council to speak on the bill. The hearings are the latest in a series that began in January.

Commission III chair Habiburokhman, from the Gerindra Party, called suggestions that the DPR is delaying the bill a “hoax.”

“We are moving full speed ahead with this bill,” he said on July 13

The bill is aimed at putting more teeth into anticorruption efforts by making it easier for the state to seize ill-gotten assets. First proposed in 2008, it has been stalled by the lukewarm attitudes of lawmakers and policymakers.

In 2025, nationwide anti-government protests gave it renewed momentum but it was sidelined by deliberations on the new Criminal Law Procedures Code (KUHAP) and the National Police Law.

Habiburokhman said the DPR needs a longer process because the measure is an entirely new law rather than a revision of an existing law.

Deputy House Speaker Saan Mustopa of the NasDem Party said on July 14 that the measure remains on the 2026 priority legislation list and that lawmakers “are aiming to complete deliberations this year,” Antara reported.

Muhammad Aghva of the Syarif Hidayatullah State Islamic University (UIN) student council, said prolonged discussions had undermined public confidence.

“Every month or year this bill is delayed, the House gives financial criminals more time to hide, transfer or move their assets beyond Indonesia’s jurisdiction,” Aghva said in one of the hearings on July 13.

The renewed deliberations come as public attention is focused on the case of former Deputy Attorney General for Special Crimes Febrie Adriansyah, who was named a suspect by the police over the weekend after police seized cash and gold bars from his house in Sentul. Activists say passage of the Asset Forfeiture Bill could reassure the public that the government is serious about tackling corruption as a wave of other cases, including a scandal at the free nutritious meals program, have made headlines.

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S&P Affirms Indonesia’s Investment-Grade Rating

S&P Global Ratings has affirmed Indonesia's sovereign credit rating at BBB for long-term debt and A-2 for short-term debt, while maintaining a stable outlook, according to a report released on July 13.

Both BBB and A-2 indicate a borrower can meet its financial commitments while remaining vulnerable to adverse economic conditions.

The ratings agency said the decision reflects its view that the recent deterioration in Indonesia's fiscal and external indicators – driven by elevated energy prices and interest rates, rupiah weakness, policy uncertainty, and rising debt – is temporary and should improve as commodity prices recover and policy changes stabilize. S&P also cited the government's efforts to strengthen governance in the natural resources sector, which it said could support state revenue and export earnings over time.

However, S&P warned that the rating could come under pressure if fiscal and external conditions weaken further, including if the deficit rises by more than 3 percent of GDP annually, interest payments remain above 15 percent of government revenue, or export receipts sharply decline.

Coordinating Minister for Economic Affairs Airlangga Hartarto said the affirmation reflected international confidence in Indonesia's economic management. "Despite rising global uncertainty, Indonesia has sustained economic growth of around 5 percent, maintained fiscal discipline by keeping the deficit below 3 percent of GDP, and continued strengthening governance in the natural resources sector," Airlangga said in a statement on July 13.

Bank Indonesia Governor Perry Warjiyo said the decision underscored confidence in Indonesia's macroeconomic stability and medium-term growth prospects. He added that the central bank would continue strengthening its policies to safeguard stability while supporting sustainable economic growth.

Experts welcomed the assessment but warned that Indonesia was not out of the woods yet. Trimegah Sekuritas Indonesia Chief Economist Fakhrul Fulvian, said the affirmation sends a positive signal to investors but stressed that maintaining confidence will depend on consistent policy implementation rather than communication alone.

"This is recognition that the reforms underway are beginning to be understood by global investors. What S&P appreciates is not just the ideas themselves, but its confidence that implementation will continue to improve," said Fakhrul.

The benchmark Jakarta Composite Index closed on July 15 up slightly at 6,041.97, a 0.04 increase. The rupiah is still trading below 18,000 to the US dollar.

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Gov’t Requires Producers to Finance Plastic Waste Management

The Ministry of Environment is preparing a mandatory Extended Producer Responsibility (EPR) policy requiring producers of plastic-packaged goods to finance the collection and management of waste generated from their products. The idea is to address Indonesia's growing waste problem while strengthening the circular economy and creating green jobs.

The policy will require around 10,000 large manufacturers using plastic packaging to contribute funding through independently managed Packaging Recovery Organizations (PROs), which will oversee waste collection, recycling and other community-based environmental programs.

Minister of Environment Mohammad Jumhur Hidayat said the producer-funded PROs would create green jobs while supporting communities. "The funding will not be small, it will come from the producers. Activities carried out by the PRO will create green jobs," he said on July 12, adding that major manufacturers using plastic packaging had expressed their readiness to implement the policy.

To support the new policy, officials are revising Minister of Environment and Forestry Regulation 75/2019 on the Producer Waste Reduction Roadmap, with completion targeted for September. The revision will make EPR mandatory for all producers, replacing the current voluntary framework.

Previously, the Environment Ministry’s Director for Waste Reduction and Circular Economy Development Agus Rusly said on July 3 that producers' EPR contributions would be based on the ease of recycling their packaging. Multilayer packaging used in products such as instant noodles, shampoo, and disposable diapers are a major challenge, he said.

Officials also plan to launch a nationwide Tobat Ekologis (Ecological Repentance) movement in August, including a program to plant 2 billion trees, which Jumhur said would create additional green jobs through seedling production, planting, and maintenance.

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Managing B50 will require Increased CPO Production

With Indonesia’s mandate for the use of B50 biodiesel in place as of July 1, industry figures say they can handle the increased demand for crude palm oil this year but warn that sustaining the policy will require significantly higher production in the future.

The mandatory increase in palm-oil based diesel fuel to a 50 percent blend is expected to push domestic CPO consumption for biodiesel to between 16.3 million and 17 million metric tons annually. Producers expect national CPO output of around 53 million metric tons in 2026, which should be sufficient to meet fuel demand.

“This year should be safe, because the additional 1.74 million tons needed for B50 can still be met from current production capacity,” Indonesian Palm Oil Association (GAPKI) chairman Eddy Martono told The Jakarta Post on July 10.

That does not guarantee that future supply will be sufficient, Eddy said, noting that this year's El Nino weather pattern could impact harvests. To satisfy the B50 program without disrupting exports or other needs, annual CPO production must rise to between 55 million and 60 million metric tons, he said.

Smallholders, meanwhile, say yields from existing farms need to improve. Smallholders account for about 40 percent of oil palm farms but much of it is planted with older, low-yield trees. “The answer is productivity, not expanding plantation area,” Gulat Manurung, chairman of the Indonesian Oil Palm Farmers Association (Apkasindo), said on July 13.

He said replanting needs to be accelerated, which will require improved financing as the B50 mandate will divert around 19 million metric tons of CPO into domestic consumption, potentially reducing exports by 4 to 5 million metric tons and thus reducing proceeds from export levies that fund smallholder replanting.

Meanwhile, President Prabowo Subianto does not want to stop at B50. On July 9, at the inauguration of a B50 facility in Karawang, West Java, he said the next target should be B60.

“Continue, don’t stop at B50 if it can be B60," Subianto said, setting 2028 as the target for the next level.

The Clean Energy Transition Coalition (KTB) has warned that B50 may accelerate deforestation and cause food prices to rise by raising the risk of cooking oil shortages.

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Get to Know Our Member | IFF INDONESIA (PT Essence Indonesia and PT IFF Indonesia)

Fluoris one of the world’s largest publicly traded engineering, procurement, fabrication, construction, maintenance and project management companies. Established in Indonesia in 1970, Fluor has successfully completed more than 100 projects in Indonesia and has been involved in many major projects, particularly in mining, oil and gas, and power. These projects include building Indonesia’s largest refinery, Pertamina Cilacap; the world’s first offshore Arco Ardjuna NGL facility in the Java Sea; the world’s largest IPP at the time of completion, CFPP Paiton; and the world’s largest greenfield copper and gold mine at the time of completion, Batu Hijau Mine.

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Update is AmCham’s regular newsletter on developments related to investment, the economy, regulations and issues related to doing business in Indonesia. It comes out three times a week. It is edited by AmCham Managing Director Donna Priadi and written by the AmCham Staff.

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