Batam, not Bali, should be the financial hub of Indonesia

Indonesia has over 900 permanently inhabited islands among its 17,000+ islands, but Bali gets the overwhelming majority of international visitors to the country. The last thing that Bali needs is to be turned into a financial hub like the Dubai International Financial Center.

Bali doesn’t need any gimmicks to attract more visitors, and the government has previously tried to redirect visitors to other places with the 10 New Bali plan. This new call to turn Bali into a financial hub, when it recently declared it is going to suspend building new hotels, is a baffling pivot.

Indonesia would be better off sticking to its original 10 News Bali plan by developing other cities. Batam would be an ideal candidate to become a financial hub.

Batam is a city island in the Riau Islands province, between Sumatra and Singapore. On a clear day, you can see Singapore from Batam, and several ferry companies ply the route between Singapore and Batam.

There is already a plan to turn Batam into a special economic zone with its neighbours as part of the Indonesia–Malaysia–Singapore growth triangle. This plan is also known as the SIJORI Growth Triangle, which includes Singapore, Johor (Malaysia), and the Riau Archipelago, a part of Riau Islands Province (Indonesia).

In January 2025, Singapore and Malaysia agreed to create the Johor-Singapore Special Economic Zone. There are calls to include the Riau Islands, and Indonesia should be looking to build a great city in the Malacca Strait to compete with Singapore and Malaysia.

Batam is ideally positioned to emulate Shenzhen, which rode on the back of the Hong Kong economy until it became the economic powerhouse that it is today.

Johor has set itself up to be the Shenzhen of Southeast Asia, so Batam should also be doing everything to become integrated into this strait’s economy.

Unfortunately for Batam, the city is not well planned. The old city area is dilapidated, and the new urban areas are making the same mistakes as the old areas (unwalkable car-centric developments).

The old city area (known as Nagoya) has the potential to become a pleasant area if the roads were fixed, trees planted, and sidewalks repaired and widened. Some streets could even be pedestrianised. As I have written before, sidewalks are the secret sauce to simulating Singapore’s success in Southeast Asia cites.

There are many apartment projects on the island, as Batam has become a strategic place to live due to its proximity to Singapore. I have been to a few of the new urban areas, and I always walk to them to see how they are integrated into the city. Here is one of the new developments I walked to, which has no footpaths and no greenery.

Instead of turning Bali into a financial hub, turn Batam into a financial hub to compete with its neighbours. Build the proposed transit system to connect the airport to the main urban areas, and fix the city so it is a walkable place that people want to hang out in.

Indonesia needs to start building great cities. Let Bali be the cultural tourism hub, and let Batam try and emulate Dubai.