Nadiem's corruption conviction sends a warning to investors

Indonesia's courts convicted Nadiem Makarim, the former education minister and co-founder of the ride-hailing company Gojek, of corruption on 30 June 2026. He was sentenced to 10 years in prison and ordered to pay back Rp 809 billion (about US$44.9 million), or serve five more years if he does not. The case was about buying more than one million Google Chromebook laptops for schools during the pandemic.

What worries analysts is not the verdict alone but how it was reached. Legal scholars Simon Butt and Tim Lindsey point out that Indonesia's main anti-corruption law, written in 1999, defines "state losses" (money the government is said to have lost) so broadly that a person can be convicted without proof that they meant to steal or cheat. Here the loss figure came from an auditor's assumptions about profit margins, not from a real survey of market prices. The Constitutional Court itself admitted the law was too broad and asked parliament to fix it in December 2025, but nothing has changed. The case also fits a pattern: two officials convicted in 2025, former trade minister Tom Lembong and party official Hasto Kristiyanto, were later pardoned by President Prabowo.

The bigger cost is trust. When a normal policy decision can be treated as a crime years later, investors cannot judge the risk. Indonesian startup funding has already fallen from US$9.4 billion in 2021 to US$440 million in 2024. In the IMD World Competitiveness Ranking, Indonesia dropped to 48th of 70 economies in 2026, down from 27th in 2024, and its score for the strength of its institutions fell from 14th to 50th in just two years. As Indonesia at Melbourne puts it, the line between a business decision and a crime is now drawn "after the fact by whoever holds power".

Why it matters

If you run a business, invest, or work at a startup in Indonesia, this raises the risk that a choice which looks reasonable today could be treated as a crime later. That kind of uncertainty pushes investors to demand a bigger safety margin or simply walk away, which means less funding and fewer jobs. It also weighs on honest officials, who now have reason to avoid bold decisions in case a future government judges them differently.