Indonesia’s social security fund, BPJS Ketenagakerjaan, is preparing to invest in companies that provide infrastructure for artificial intelligence (AI), pending government approval for overseas investments (24/11).

Edwin Ridwan, director of investment development, said the AI supply chain offers a valuable way to diversify the fund’s portfolio. “The artificial intelligence (AI) supply chain will be a good diversification for our investment, and it could be in the United States, Taiwan, Japan, and South Korea,” he said, noting there is no set timeline for the decision.

Government Approval Needed for Overseas Allocation

BPJS Ketenagakerjaan is seeking approval to invest up to 5% of its total portfolio abroad. The fund currently manages 879 trillion rupiah ($52 billion) in assets. Ridwan said most of the overseas allocation, about $2.5 billion, is likely to go into stock markets through mutual funds or ETFs rather than private equity.

Investment Targets the AI Supply Chain, Not Core Chipmakers

The fund plans to focus on companies that support AI operations, including data centers, energy providers, and cable companies. Core AI firms, such as chipmakers, are considered “too crowded” for investment, Ridwan added. He did not rule out companies like Nvidia, but any decision will depend on valuation.

Rupiah Stability Critical for Investment Timing

Indonesia is preparing regulations to allow pension funds to invest abroad, including provisions for investing in gold and limiting losses under certain conditions. Ridwan emphasized that overseas investments would only proceed once the rupiah stabilizes. “Even if we were already allowed to (invest overseas), I would think we will wait until the rupiah can be considered stable,” he said.

The rupiah has depreciated more than 3% against the U.S. dollar this year, standing at around 16,700 per dollar, amid concerns over Indonesia’s fiscal discipline following the dismissal of finance minister Sri Mulyani Indrawati.

PHOTO: FREEPIK

This article was created with AI assistance.