IBC Papers

Every year, hundreds of thousands of Indonesians seek overseas employment, supporting their families and contributing significantly to the national economy through remittances. However, the sector faces critical challenges, including vulnerabilities to exploitation, weak protection mechanisms, and gaps in skills and certification that hinder workers’ success abroad. The Indonesian Business Council (IBC) presents a study on the “Expansion of Indonesia’s Overseas Worker Industry / Industri Pekerja Migran Indonesia (PMI),” highlighting both its immense potential and the obstacles it faces.

To strengthen the PMI sector, Indonesia must adopt a more inclusive approach that recognizes the vital role of the private sector. A globally competitive migration system depends on collaboration among training institutions, recruitment agencies, employers, and financial institutions. The IBC report provides data-driven insights and practical recommendations to improve training, streamline deployment, and enhance worker protection—key steps toward developing a skilled, protected, and empowered migrant workforce capable of competing on the global stage.

Indonesia stands at a critical juncture to capitalize on global labor opportunities by leveraging its demographic bonus to address pressing socioeconomic challenges, including 7.47 million unemployed and 11.56 million underemployed individuals amid rising cost-efficiency pressures and corporate downsizing. With an estimated global shortage of 690,000 workers in industries such as caregiving, welding, and hospitality in 2024, Indonesia’s workforce—especially low- and medium-skilled migrant workers—represents a hidden asset with the potential to boost annual remittances (already over $14 billion), reduce domestic unemployment, and enhance skills through targeted upskilling. This policy brief outlines strategies for expanding the overseas workforce industry and calls for a paradigm shift in viewing Indonesian migrant workers as valuable economic contributors, emphasizing the government’s role in policy reform and the private sector’s responsibility in workforce preparation to position Indonesia as a major player in the global labor market.

Indonesia enters 2025 in the middle of a cross-fire, facing an increasingly complex economic landscape shaped by both global disruptions and domestic challenges. The nation’s ability to navigate shifting geopolitical dynamics, trade realignments, and technological advancements while addressing structural inefficiencies at home will determine its economic trajectory. The IBC Business Outlook 2025 provides an analysis of these key forces, offering insights to equip businesses and policymakers with the foresight needed to adapt, innovate, and drive sustainable growth.

Indonesia’s Free Meal Program (Makan Bergizi Gratis, MBG) combats nutritional deficiencies among children, pregnant and breastfeeding women, and toddlers by providing daily meals sourced locally from farmers and MSMEs. After a successful pilot in Sukabumi, the program launched in January 2025 and now spans 190 locations in 26 provinces, supported by public kitchens (SPPGs) for standardized meal production. However, key challenges persist, including operational inefficiencies, fragmented data systems, limited integration with social programs, insufficient private-sector engagement, and poor dietary habits among children. To address these, IBC recommends enhancing supply chains through first-mile and last-mile solutions, integrating real-time data systems, aligning with other social initiatives for holistic interventions, involving private-sector partners to increase efficiency, and promoting community-based nutrition education for sustained behavioral change. Through strategic collaboration and improvements, MBG can reduce malnutrition, drive inclusive socio-economic growth, and fortify Indonesia’s long-term resilience.

Indonesia’s socio-economic progress is at a pivotal moment, grappling with challenges despite its G20 status, as welfare indicators highlight the need for improved poverty rates, education, and health. This study emphasizes the urgency of leveraging the country’s youthful workforce and aligning with the Sustainable Development Goals (SDGs), while addressing financial constraints and regional disparities. It underscores the private sector’s crucial role in tackling socio-economic issues, advocating for strategic policy reforms, enhanced regulatory frameworks, and collaborative efforts between the government and private sector to drive sustainable development.

To support the leadership of President Prabowo Subianto and Vice President Gibran Rakabuming Raka, IBC proudly presents the white paper titled “15 Policy Package Recommendations to Support the Development Agenda of the President and Vice President of Indonesia 2024 – 2029.” This document maps out challenges across various focus areas and offers strategic policy package recommendations to support delivering 8 Asta Cita Missions, 8 Best Results Programs Fast, 17 Priority Programs, as well as other work programs.

The 15 policy package recommendations are based on the national management framework for a Competitive and Prosperous Indonesia. This framework consists of four main pillars: Economy, Human Resources, Governance, and Innovation, specifically formulated through 15 focus areas. These focus areas cover issues such as resource downstreaming, food estate, bureaucracy digitalization, and advanced technology production. Each policy package recommendation is designed in a modular fashion, allowing readers to select the parts most relevant to their interests and fields independently.