Indonesia Investment Authority and DBJ Launch $60M Hybrid Fund to Boost Mid-Sized Businesses

Indonesia Investment Authority (INA) and the Development Bank of Japan (DBJ) have launched a $60 million hybrid fund to finance medium-sized businesses in Indonesia. This fund will offer senior secured investments, providing tailored financing solutions to mid and upper-market corporates, fostering sustainable growth.

Hybrid capital solutions, combining debt and equity, are gaining traction in the Asia-Pacific region as an alternative to traditional financing. INA will utilize its local market expertise and structured financing capabilities, while DBJ brings its financial experience and Japan-related business networks to attract private sector investments in Southeast Asia’s largest economy.

President Prabowo Subianto aims to boost Indonesia’s economic growth from 5% to 8% annually by 2029. The INA-DBJ collaboration is expected to support this goal by enhancing access to capital for growing businesses.

Indonesia is set to launch a second sovereign wealth fund, Danantara Indonesia, on February 24, with assets projected to exceed $900 billion. This move underscores Indonesia’s ambition to strengthen its financial infrastructure and attract global investment.

Japanese financial institutions, including DBJ, are increasingly focusing on Indonesia as a key market for expansion in Southeast Asia. The partnership between INA and DBJ highlights the growing importance of Indonesia in regional investment strategies.

The financial terms of the INA-DBJ fund were not disclosed, but the initiative reflects the rising demand for innovative financing solutions in the region. As Indonesia continues to develop its economic landscape, such strategic partnerships are expected to play a vital role in driving sustainable growth and attracting global capital.