Kadin Demands First Commerce Law Overhaul in 40 Years to Push Indonesian Business into Global Supply Chains

JAKARTA, Investortrust.id — The Indonesian Chamber of Commerce and Industry (Kadin), the country’s most influential private sector umbrella organization, has launched an aggressive push to overhaul its 39-year-old statutory framework as it seeks to reposition Southeast Asia's largest economy against turbulent global headwinds.

Anindya Novyan Bakrie, Executive Chairman of Kadin Indonesia, stated that Law Number 1 Year 1987 concerning the Chamber of Commerce and Industry is obsolete and can no longer effectively shield or advance domestic businesses. Kadin is now urging the House of Representatives (DPR RI) to fast-track the newly drafted amendment bill.

For global investors and multinational corporations, this legislative shakeup signals a major pivot toward a more agile regulatory environment in Indonesia. The updated legal framework is designed to seamlessly align private sector capital with state macroeconomic policy, streamline cross-border trade pipelines for small businesses, and accelerate the country's transition into green industrial manufacturing.

Navigating Geopolitical Shocks and Digital Transformation

"First, we clearly see that the most fundamental shift is happening in geopolitics," Anindya Bakrie said during a public hearing with the Parliamentary Legislation Body (Baleg) at the Parliament Complex in Jakarta on Wednesday (6/17/2026).

Bakrie emphasized that the rapid rise of the digital economy, coupled with climate change pressures, requires a complete rewiring of how Indonesia approaches industrial resilience. The ongoing fragmentation of global supply chains means local businesses can no longer rely on outdated legal protections.

"This is forcing us to rethink how we can reinforce the business community in Indonesia," Anindya explained during the legislative session. "The goal here is to upgrade and update Kadin’s positioning to a level that matches the urgent needs and challenges of both the present and the future."

A Massive Push for 60 Million SMEs

The second pillar of the proposed statutory reform focuses heavily on unleashing the economic power of Indonesia’s Micro, Small, and Medium Enterprises (MSMEs), which currently generate the lion's share of the nation's GDP.

However, despite numbering over 60 million separate entities, the vast majority of these businesses remain completely locked out of the formal economy. Kadin notes that severe restrictions in accessing credit markets, technical networks, and international trade corridors continue to stifle growth.

Under the new bill, Kadin will secure broad statutory mandates to run nationwide standardized corporate training, commercial certifications, and institutional capacity building to systematically scale these smaller enterprises.

Escaping the Middle-Income Trap

The new legal architecture is also designed to act as a powerful engine for high-quality job creation. Indonesia faces a massive demographic challenge, with over 4 million young citizens entering the job market every single year. Currently, the private sector anchors the economy by generating more than 70% of all employment.

Over the long term, Kadin expects this legislative modernization to provide the critical macroeconomic leverage the government needs to finally break free from the middle-income trap and propel Indonesia into advanced-economy status.

"For those businesses that haven't made the leap yet, this will give them the platform to start, which ultimately drives massive job creation," Bakrie concluded regarding the vision to push local companies into global supply chains.