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View all search resultsRevenue losses in palm and coal: The price of weak control
President Prabowo Subianto's new plan to fight billion-dollar commodity fraud through a centralized state gatekeeper risks creating a monopoly far worse than the corruption it aims to cure.
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President Prabowo Subianto delivers a speech on the macroeconomic framework to lawmakers on May 20, 2026 at the House of Representatives building in Jakarta. (AFP/Bay Ismoyo)
T
he scale of the leakages is profoundly alarming. Over the past three decades, export under invoicing, transfer pricing and commodity misreporting may have cost Indonesia hundreds of billions of dollars in lost state revenue and foreign-exchange earnings.
Speaking in a House of Representatives plenary last week, President Prabowo Subianto described the practice bluntly as “fraud”. On that point, he is right, and for once, I agree with him.
Indonesia may not have lost as much as the US$150 billion implied by Prabowo’s estimate. But even the far more conservative estimate by Global Financial Integrity – roughly $6.5 billion annually in illicit financial outflows linked to trade under invoicing – points to a serious structural failure in economic governance.
The problem is real. But the cure may cut deeper than the wound.
The government’s new plan would centralize exports of coal, palm oil and ferroalloys through PT Danantara Sumberdaya Indonesia (DSI), a newly established export institution under state asset fund Danantara.
Exporters would no longer transact directly with overseas buyers, but instead channel exports through DSI, which would verify prices against international benchmarks, monitor shipment reporting, and oversee foreign-exchange repatriation. In effect, DSI would operate as both a centralized export aggregator and a regulatory gatekeeper for Indonesia’s strategic commodities.
Officials argue that the scheme will strengthen oversight, reduce under invoicing and transfer-pricing practices, and enhance Indonesia’s bargaining position in global commodity markets. Rosan Roeslani has pledged tighter reporting standards and greater transparency, while emphasizing compliance with OECD-style pricing principles.
