Indonesia currently faces a critical economic issue: the persistent outflow of national wealth. A significant amount of the country’s economic wealth is stored and used overseas, leading to a continuous financial hemorrhaging that has been ongoing for decades. This problem dates back to the colonial period, with wealth leaving the country and benefiting foreign nations. This situation has persisted for centuries, with Indonesians essentially working for others involuntarily, leading to a situation where the country’s wealth is not staying within its borders.
The Dutch East India Company (VOC) era exemplifies this issue, with profits from economic growth in the Indonesian region being banked in the Netherlands. Today, the outward flow of wealth is less overt but still significant, with many choosing to remain silent or even facilitating this process. Tracking the drain of Indonesia’s wealth abroad can be done through various economic indicators, such as the trade balance and ownership structures of exporting companies.
Analyzing Indonesia’s export-import ledgers reveals that a substantial amount of wealth leaves the country each year. The Global Financial Integrity estimates that export leakages due to misinvoicing amounted to billions of dollars, further exacerbating the issue. Additionally, Indonesian entrepreneurs and companies have vast amounts of money stored overseas, equivalent to the country’s GDP.
The majority of Indonesia’s export profits go to foreign companies that operate in the country but keep their earnings abroad. This, along with Indonesian entrepreneurs transferring profits overseas, poses a significant challenge to the country’s economy. The money that leaves Indonesia cannot be used to stimulate the economy or provide essential services, leading to a lack of capital in domestic banks.
The outflow of Indonesian wealth has been a recurring issue for centuries, as highlighted by Sukarno in his speech “Indonesia Menggugat.” He addressed the problem of wealth leaving the country, a sentiment that Prabowo Subianto echoes in his analysis of the current economic situation. The continuous outward flow of national wealth hampers Indonesia’s economic development and stability, leading to a situation where the rich get richer, and the poor remain marginalized.
Prabowo Subianto emphasizes the need for transparency and action to repatriate the tens of thousands of trillions of Rupiah that should be in Indonesia but are parked abroad. Addressing this systemic issue is crucial for Indonesia’s economic future and the well-being of its citizens.
