by Stefan J. Bos, Worthy News Chief International Correspondent

KUTA/JAKARTA, INDONESIA (Worthy News) – A dispute over one of Indonesia’s largest gold mines has become a symbol of President Prabowo Subianto’s drive for greater state control over the country’s vast natural resources and unease among international investors.

The controversy centers on the Martabe gold mine in North Sumatra, operated by PT Agincourt Resources. Authorities moved early this year against companies accused of environmental violations following deadly floods and landslides in Sumatra, Worthy News established.

The government announced in January that permits involving 28 companies would be revoked, including rights associated with Martabe, raising fears that control of the lucrative mine could eventually pass to a state-owned company.

However, Prabowo later ordered a review of the case, saying investors should regain their rights if no serious wrongdoing was found. The mine was later allowed to resume operations.

INVESTOR CONFIDENCE

Yet the Martabe episode came as international investors were already becoming increasingly wary of Prabowo’s economic policies and the expanding role of the Indonesian state.

Indonesia’s stock market has fallen sharply this year after global index provider MSCI raised issues over transparency in the market and warned of possible changes to Indonesia’s status in its influential indexes.

The market turmoil has coincided with Prabowo’s efforts to increase Indonesia’s control over the enormous wealth generated by its natural resources, extending an economic nationalism that already transformed the country’s nickel industry.

His government is preparing a commodities exchange aimed at giving Indonesia greater influence over prices for strategic minerals and other resources instead of leaving much of that power to overseas markets.

SETTING PRICES

Prabowo has argued that Indonesia, one of the world’s largest producers of several strategically important commodities, should have greater influence over the prices at which those resources are sold.

The president believes Indonesia should keep more of the wealth generated by its natural resources at home rather than mainly supplying raw materials to global markets.

However, international investors want greater clarity about how far Jakarta intends to expand state involvement and whether their investments will remain protected.

The uncertainty is also being felt within Indonesia’s own business elite, with some of the country’s wealthiest families putting more of their money overseas.

WEALTHY FAMILIES

In recent weeks, details emerged that companies linked to the Hartono family, Indonesia’s wealthiest family and controlling shareholders of Bank Central Asia, had invested at least $1.4 billion overseas.

The development was significant because the family had traditionally kept most of its wealth in Indonesia. Commentators say the investments reflect wider unease among parts of the country’s business elite over Prabowo’s policies.

Other wealthy Indonesians are also moving capital offshore amid uncertainty over government policies and the country’s economic outlook, Worthy News learned. “This is certainly because of the president’s policies. People have to safeguard their lives,” a Christian entrepreneur told Worthy News.

Reports have also suggested that some wealthy Indonesians fear stronger government pressure on the country’s tycoons, contributing to money moving abroad.

STATE INVESTMENT FUND

The shift has come alongside the growing influence of Danantara, a powerful state investment fund established under Prabowo to manage hundreds of billions of dollars in government assets and help finance major projects.

Danantara has sought money from some of Indonesia’s wealthiest business families through government-backed “Patriot bonds.”

Political debate also emerged over the Hartono family’s controlling stake in Bank Central Asia, although Danantara denied suggestions that the government intended to take control of the family’s holding.

Despite their overseas investments, the Hartonos continue to hold most of their wealth in Indonesia, highlighting the complicated relationship between the country’s business elite and Prabowo’s government.

NEW FINANCE MINISTER

Amid the financial turmoil, Prabowo reshuffled his economic team as he sought to reassure investors.

On September 14, he dismissed Finance Minister Purbaya Yudhi Sadewa after about a year in the job and replaced him with his deputy, Suahasil Nazara, a former academic who had served as deputy finance minister since 2019.

Investors generally welcomed the appointment, viewing Suahasil as a more predictable policymaker who could help restore confidence after months of uncertainty over government spending and economic policy.

Suahasil has pledged to keep government finances under control while continuing Prabowo’s programs. On Friday, he also stressed the importance of consistent policies and open communication with financial markets.

PRABOWO’S PAST

Prabowo, 74, a former army general and special forces commander, won Indonesia’s February 2024 presidential election with nearly 60 percent of the vote and was sworn in as the country’s eighth president on October 20 that year.

His victory marked a remarkable political comeback for the former son-in-law of Indonesia’s longtime authoritarian ruler Suharto, whose 32-year rule ended amid mass protests in 1998.

Prabowo was dismissed from the military that year and has faced allegations involving the abduction of pro-democracy activists and other human rights abuses during his military career. He has denied wrongdoing and has never been convicted over the allegations.

Some Indonesians have expressed unease to Worthy News about his military past and what they view as the growing role of the state in the country’s economy and political life.

DEMOCRATIC MANDATE

Yet Prabowo won a decisive democratic mandate and campaigned largely on continuing the economic development pursued by his predecessor, Joko Widodo, his supporters argue.

There are signs Prabowo is trying to improve relations with Indonesia’s business community.

On Friday, he named several tycoons to a new 24-member advisory council, alongside politicians and influential former Islamic leaders.

The appointments potentially give some of Indonesia’s most prominent business figures a more direct channel to the president.

BUSINESS LEADERS

There are also indications that some international investors believe this year’s sharp market decline has created opportunities, with foreign money returning to parts of the Indonesian market, including government bonds.

Sweden’s Coeli Asset Management recently made its first investment in Indonesia following the steep market decline. Fund manager James Bannan said after visiting Jakarta that Prabowo appeared increasingly willing to listen to investors.

The developments suggest a more complicated picture than earlier this year. Doubts over state intervention and the direction of economic policy remain, but some investors are again finding opportunities in Southeast Asia’s largest economy.

The Martabe mine itself is operating again, but its disruption illustrates the challenge confronting Prabowo: extracting more economic value from Indonesia’s immense natural wealth while convincing foreign investors and the country’s own business elite that their money and property remain secure.

The outcome could help determine whether Prabowo’s economic nationalism attracts the investment Indonesia needs to accelerate growth or makes international and domestic investors more cautious about allocating assets in the world’s largest Muslim-majority nation.image1.jpeg

Copyright 1999-2026 Worthy News. This article was originally published on Worthy News and was reproduced with permission.