AmCham Update Vol. 7 #108

IDX Announces More Reforms, BI says Bond Market Outflow ‘Manageable,’ Indonesia Cuts Some Gas Exports to Singapore, Lemigas to Enter Oil Purchase Business, Stimulus and Discounts Unveiled for Holiday Season

Oct 27, 2026

IDX Announces More Reforms following MSCI Warning

Stung by sharp capital outflows due to MSCI’s Oct 16 threat to demote Indonesia’s stock market to standalone status, the Indonesia stock exchange (IDX) announced more measures to address stock manipulation, including adding independent parties to a committee evaluating stocks with concentrated ownership structures.

The IDX said it would expand the membership of a committee that evaluates stocks with high shareholder concentration to include independent parties including academics and %u2060 a representative of foreign investors, IDX CEO Jeffrey Hendrik said at a press conference on Oct 26

“With our current technology, once we detect any early indications of manipulative practices or pricing in the market, we will issue a report to initiate an investigation,” Jeffrey said.

During an investigation, the IDX will inform the public and may freeze an account.

Jeffrey said the measure shifts enforcement from a full stock trading suspension to halting specific accounts in certain securities, and was aimed at preserving market liquidity.

Financial Services Authority (OJK) chief capital market supervisor Hasan Fawzi told the same press conference that the agency is pushing the IDX to improve its trading surveillance by enhancing its capacity to identify “unusual transaction patterns [and] coordinated trading indications.”

He also unveiled efforts to support the market by extending a rule that allows share buybacks without approval from a general shareholder meeting until June next year, as well as improving market transparency through high shareholding concentration (HSC) reporting.

The IDX has also announced a plan to exclude HSC stocks from its benchmark index starting on Nov 2. The exchange currently has 80 stocks listed under the HSC category, accounting for roughly 18 percent of the Jakarta Composite Index.

The reform plan includes enhanced disclosure of shareholders holding more than 1 percent of a company, more detailed investor classification disclosure, HSC reporting and a road map toward a minimum free float of 15 percent.

Hasan said that London-based index provider FTSE Russell had provided authorities with “constructive” feedback during a meeting held on Friday. Earlier this month, FTSE Russell confirmed Indonesia’s emerging market status and kept the country off its downgrade watch list.

The MSCI warning sparked Indonesia's deepest-ever two-day stock selloff on Oct 16 and 19, sending the main index to its lowest point since 2020. It has since rebounded.

The JCI closed on Oct 27 at 5,266.13, down 1.99 percent.

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BI says Bond Market Outflow "Manageable" after MSCI Warning

The significant capital outflows from Indonesian financial markets triggered by MSCI’s warning that Indonesia could be downgraded to a standalone market, has had a limited impact on the rupiah, according to Bank Indonesia (BI).

BI Head of Monetary and Securities Asset Management Erwin Gunawan Hutapea said on Oct 23 that capital outflows accelerated following MSCI’s announcement on Oct 16, affecting equities, government securities (SBN), and Bank Indonesia Rupiah Securities (SRBI).

Erwin said foreign inflows had been “rather good” from September through mid-October, before MSCI’s warning. While he declined to disclose the exact bond outflow, BI data showed combined outflows of around Rp 5 trillion ($276.5 million) from equities and bonds. Given that the Indonesia Stock Exchange (IDX) recorded a Rp 3.4 trillion net sell-off in equities that day, the figures suggest that around Rp 1.6 trillion may have exited the bond market.

Erwin described the outflow as “manageable” and said it had not placed excessive pressure on the rupiah. “We can still manage it well, and hopefully the shock can slowly be digested by market participants,” he said. The rupiah is trading at historic lows of about 18,100 to the US dollar, moderately weaker than before the MSCI announcement.

Erwin added that BI would strengthen its monetary operations if financial market outflows translated into excessive exchange-rate volatility, while continuing to operate within established tolerance levels for the rupiah.

Erwin said BI would preserve the appeal of SRBI through its yield, noting that yields on government securities had also risen. “Furthermore, it has been observed that a correction has taken place regarding yield movements in SBN. For instance, the 10-year tenor, which was previously below 7 percent is now above 7 percent,” he said.

BI has also increased incentives for hedging through Domestic Non-Deliverable Forward (DNDF) instruments, raising the incentive from 25 percent to 40 percent for six-month tenors and from 30 percent to 40 percent for 12-month tenors.

“These incentives are provided within the context of hedging, be it for investment portfolios, foreign direct investment (FDI), or external loans under foreign financing schemes, as well as to support our push for the use of local currency transactions (LCT),” Erwin said.

Indonesian stocks are down about 40 percent this year and the Jakarta Composite %u2060Index has lost more than $330.77 billion in market value, triggered by MSCI's threat.

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Indonesia Reduces Gas Exports to Singapore

Indonesia has carried out a threatened reduction in natural gas exports to Singapore, diverting an 8-percent supply cut to the domestic market as tensions that began over regional haze from forest and peat fires take on a commercial dimension.

In response, Singapore Prime Minister Lawrence Wong called on all suppliers to honor their commercial contracts.

Singapore’s foreign minister, Vivian Balakrishnan, is reportedly due to visit Jakarta on Oct 27 for talks with Foreign Minister Arrmanatha Nasir, according to the Indonesian Ministry of Foreign Affairs.

Wong said Singapore had been preparing for potential supply disruptions by investing in liquefied natural gas (LNG) infrastructure to reduce reliance on pipeline networks. He also cited nuclear power as a potential source of reliable energy.

Djoko Siswanto, Head of the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas), announced the reduction of 31 million standard cubic feet per day (MMscfd) in gas exports to Singapore on Oct 23. He said the cut applied only to Singapore.

Singapore’s Energy Market Authority said the reduction represented around 2 percent of the country’s gas demand.

Singapore Minister for Energy and Science and Technology Tan See Leng said on Oct 26 that Singapore was accelerating the deployment of low-carbon energy sources while exploring alternatives including nuclear and geothermal power. He expressed concern over the broader trend of “resource nationalism,” particularly where it could affect contractual agreements.

Energy minister Bahlil Lahadalia rejected the suggestion that Indonesia had breached its agreements with Singapore. He said on Oct 26 that the reduction remained within the contractual minimum supply and argued that a breach would occur only if cuts exceeded 10 percent. Bahlil urged against exaggerating the dispute.

Bahlil first announced plans to reduce gas exports to neighboring countries following a cabinet meeting on Oct 21, saying Indonesia needed to prioritize domestic supply as the country entered “survival mode.” On Oct 22, he said the government would review contracts with countries that did not “show respect” to Indonesia. He did not name any country.

The dispute follows recent diplomatic exchanges over the haze issue and threats by Indonesia to prosecute Singaporean companies found to be responsible for the fires.

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Lemigas Given Authority to Purchase Oil as Subsidized Fuel to Expand

President Prabowo Subianto’s government has revised Presidential Regulation (Perpres) No. 26/2026 to expand the role of public service agencies (BLU) in energy imports, blurring boundaries between government agencies, state-owned enterprises (SOEs) and the private sector, energy Minister Bahlil La Lahadalia said on Oct 26.

Under Article 4 of the Perpres, imports of oil and gas products under bilateral cooperation schemes may be executed either by Pertamina or by the Oil and Gas Testing Center (Lemigas) of the energy ministry.

It also authorizes the government to direct Lemigas to import oil and gas products to support strategic energy reserves and operational stockpiles. During emergencies, Article 5 allows Lemigas and energy SOEs to independently procure oil and gas if domestic supplies are disrupted by geopolitical developments or other factors.

Granting Lemigas the authority to import oil and gas products is a major departure from the center’s traditional research and testing role. The energy ministry says the expanded authority is intended to facilitate government-to-government transactions, including potential purchases of up to 150 million barrels of Russian crude oil.

Economists say the new regulation risks creating overlapping responsibilities between Pertamina and Lemigas, now designated as a public service agency. Assigning a commercial function outside the center’s core expertise could complicate coordination and distract Lemigas from its primary functions of research and testing.

Meanwhile, Bahlil told the press on Oct 26 said that because the market price of crude oil is higher than the average assumed in the state budget, “additional subsidies and compensation will certainly happen.”

The two most widely used fuels in the country, Pertalite and Solar, both sold by Pertamina, are subject to nationwide volume quotas, with the government subsidizing prices. Pertalite reserves now stand at only 18 days, Bahlil said, as demand for cheaper gas has spiked due to price increases for nonsubsidized fuels.

In response, the government plans to increase the quota for Pertalite, necessitating higher gasoline imports than initially planned.

Finance Minister Suahasil Nazara said supplies would be increased. “We certainly will ensure it,” Suahasil said about the Pertalite quota, before adding that the fiscal deficit target remained at 2.85 percent of gross domestic product.

The government has since the start of the Iran war promised publicly not to increase the price of subsidized fuels.

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Transport Discounts, other Stimulus on tap for Holidays

The government will continue its policy of issuing transportation discounts for the coming Christmas and New Year holiday period as a way to boost household spending through the end of the year.

The package includes a value-added tax waiver for domestic economy class flights, the Government Communications Agency said on Oct 25.

The transportation incentives cover domestic scheduled flights, trains, passenger ships and ferry crossings, with discounts of up to 30 percent on fares and up to 100 percent on some port service charges.

The VAT waiver applies to tickets purchased from Oct 20 to Jan 10, 2027 for travel from Dec 22 to Jan. 10, 2027. The facility excludes additional services, such as excess baggage and seat selection.

The policy is intended to ease travel costs and encourage domestic tourism. The same basic benefit was used last year during the holiday season.

Coordinating Economic Minister Airlangga Hartarto said the transportation stimulus was expected to benefit around 6.6 million people and cost the state around Rp 883 billion.

Beyond transportation, the government will extend economic stimulus measures into the fourth quarter to support consumer spending. The package includes food assistance and wage subsidies.

Airlangga said the government was preparing additional stimulus measures for January, including extending national internship and vocational training programs and waiving income tax for workers earning below Rp 10 million per month.

CORE Indonesia economist Yusuf Rendy Manilet said the stimulus would stop household spending from declining but is unlikely to significantly boost fourth-quarter growth.

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Subway Indonesia Marks Fifth Anniversary with New Menu Launch

Subway Indonesia marked its fifth anniversary with the launch of a limited-time menu item, Overload Smoky Cheese, as part of its “CeleBREADtion” campaign. The launch recognizes the brand’s growth and customer support since its return to Indonesia in 2021.

Anthony McEvoy, President Director of PT MAP Boga Adiperkasa Tbk, the official licensee of Subway in Indonesia, said the anniversary represents an important milestone for the company. He highlighted Subway’s commitment to providing fresh, convenient, and high-quality dining experiences while maintaining close relationships with customers.

Since opening its first outlet in Jakarta in 2021, Subway Indonesia, managed by PT Sari Sandwich Indonesia, has expanded to more than 110 locations across Greater Jakarta, Bandung, Surabaya, Malang, Bali, Medan and Batam.

Alongside its network expansion, Subway Indonesia has introduced menu offerings tailored to local preferences and strengthened its presence in shopping malls, office districts, and public transportation hubs. The company has also expanded its accessibility through online delivery services.

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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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