Case | HBS Case Collection | November 2007 (Revised January 2013)

Indonesia: Attracting Foreign Investment

by Michael E. Porter and Christian H.M. Ketels

Abstract

Describes the economic development of Indonesia from independence after World War II to 2006 and the post-Suharto period. The coverage of the post-Suharto period provides evidence of how political and economic conditions are intertwined after a change in the political regime. Profiles the business environment in 2006, including a documentation of past and present policies that shaped the current situation. A particular focus is Indonesia's stance towards attracting foreign direct investment (FDI). The country has a checkered history of oscillating between seeking and fighting foreign investors. Provides a perspective on the relative importance of FDI policies, general economic policies and business environment conditions, and the nature of competition from other locations on FDI flows.

Keywords: History; Situation or Environment; Competitive Strategy; Emerging Markets; Policy; Foreign Direct Investment; Business and Government Relations; Public Administration Industry; Indonesia;

Citation:

Porter, Michael E., and Christian H.M. Ketels. "Indonesia: Attracting Foreign Investment." Harvard Business School Case 708-420, November 2007. (Revised January 2013.)