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Indonesia’s Bold Step in Embracing Dual Citizenship to Propel Economic Growth

Earlier this week, the Indonesian government announced that it is considering the introduction of dual citizenship to attract skilled labour and support the nation’s ambitious goal of becoming a developed country by 2045.

This proposed policy change isn’t just administrative; it’s a strategic manoeuvre intended to supercharge economic innovation, positioning Indonesia as a magnet for global talent. 

Veronica Cotdemiey, CEO of Citizenship Invest – a Dubai-based firm that specialises in citizenship and residency by investment for high-net-worth individuals worldwide – praised the initiative: “The introduction of dual citizenship represents a transformative shift for Indonesia. It not only makes the country more attractive to international talent but also allows Indonesians abroad to maintain ties and contribute to their homeland without sacrificing their global mobility,” she stated. 

Citizenship Invest
Citizenship Invest

For years, Indonesia, Southeast Asia’s economic powerhouse, has grappled with a significant brain drain fueled by its restrictive citizenship laws. Enacted in 2006, the current statute does not permit dual citizenship for Indonesian nationals, compelling many, particularly skilled professionals and academics, to relinquish their Indonesian citizenship for better opportunities abroad. According to the Directorate General of Immigration, nearly 4,000 Indonesians acquired Singaporean citizenship between 2019 and 2022 alone, reflecting a broader trend of migration to more developed economies. 

This loss of talent is particularly significant given Indonesia’s status as an emerging market with substantial growth potential. The World Bank highlights that Indonesia’s GDP growth could accelerate if it manages to retain and attract global talent effectively. By allowing dual citizenship, Indonesia could tap into its vast diaspora, which includes professionals in high-demand sectors such as technology, engineering, and finance, who can contribute to the nation’s economic development and technological advancement. 

The debate surrounding dual citizenship in Indonesia gained particular attention in 2016 after President Joko Widodo dismissed Arcandra Tahar from his position as energy and mining minister due to his dual Indonesian and U.S. citizenship. This incident sparked a nationwide discourse on the need to modernise citizenship laws to reflect global realities. 

Historical precedents from other nations illustrate the benefits of dual citizenship. Countries such as India have implemented Overseas Citizenship, which has enabled the diaspora to contribute to their country of origin through investment, philanthropy, and knowledge transfer, without renouncing their adopted citizenships. Such policies can significantly enhance economic ties and foster bilateral relations, a potential windfall for Indonesia. 

Dual citizenship could be a game-changer for Indonesia, allowing the country to leverage global Indonesian networks and expertise,” Cotdemiey affirms. “It provides a framework for a more inclusive national development strategy that recognizes and utilises the diverse capabilities of its people, both at home and abroad.” 

The economic ramifications of such a policy extend beyond individual benefits. Granting dual citizenship can enhance Indonesia’s attractiveness as an investment destination. It could catalyse greater foreign direct investment from the Indonesian diaspora, renowned for their willingness to invest in their country of origin if legal ties are maintained. 

“Enabling dual citizenship would not only allow Indonesian expatriates to maintain their roots but also empower them to act as bridges between Indonesia and the global market,” Cotdemiey adds. “Their investments and expertise could be pivotal in shaping a resilient and thriving economic landscape for Indonesia.” 

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