Indonesia’s Promotion Towards Its Outward Foreign Direct Investment from Transnational Law Perspective

Abstract

Outward Foreign Direct Investment (OFDI) from developing economies has recently increase which have caught up to become global leaders in several industries. However, Indonesia as one of the developing economies still lacking its OFDI flow. The purpose of this research is to examine on what should the Indonesian government do to promote and coordinate its OFDI. This is done by firstly examining the success of other Asian states in promoting OFDI, and followed by comparing the role of home governments from developing countries in Asia that have better OFDI climate in coordinating their OFDI implementation from transnational law perspective that includes the role of international agreements in practice. Based on the research, it is found that to support OFDI government requires policy and regulation which is followed by coordination. This result support a conclusion that home countries should negotiate terms which protects and facilitate OFDI in investment treaties and Double Taxation Treaties. Home countries should also establish more firm coordination and collaboration internally in order to provide better assistance to their business entities that intend to conduct OFDI.

Keywords: Outward Foreign Direct Investment, Transnational Law, Indonesia, Asia

DOI: 10.7176/JLPG/123-03

Publication date:August 31^st 2022