A Complete Guide to Investing in Lombok:
Opportunities, Legal Steps, and Strategies for Success
Lombok, an exotic island located just east of Bali, has emerged as one of Indonesia’s most promising destinations—not only for tourism, but also for investment, particularly in the hospitality sector. The development of the Mandalika Circuit and the designation of Lombok as a National Strategic Tourism Area (KSPN) have placed the island in the global spotlight, attracting both travelers and investors who recognize its long-term potential in the tourism and property industries.
With natural beauty that rivals Bali and the global appeal of events such as MotoGP, Lombok has become a magnet for investment. This is evident in the growing number of local and foreign investors who have successfully launched businesses in key areas such as Kuta Mandalika, the Gili Islands (Trawangan, Air, and Meno), and nature destinations like Benang Stokel and Benang Kelambu waterfalls.
If you are considering starting or expanding a business in Lombok, here are the strategic and legal steps you need to take to launch and operate your venture lawfully, efficiently, and sustainably:
- STEP 1: CONDUCT MARKET RESEARCH AND DEFINE THE RIGHT BUSINESS MODEL. The first crucial step is to conduct thorough market research. Identify a business type that aligns with both Lombok’s unique potential and the demands of the local and international market. Promising sectors include:
- Hospitality and accommodation (villas, resorts, boutique hotels).
- Restaurants and Bars.
- Wellness and fitness services (spas, gyms, yoga studios).
- Ecotourism and outdoor activities (snorkeling, trekking, diving).
- Property rentals (short- and long-term).
- STEP 2: CHOOSE A STRATEGIC BUSINESS LOCATION. Location is a critical success factor, particularly in the hospitality industry. Some of Lombok’s most strategic and popular locations include:
- Mandalika (Central Lombok) – Near the MotoGP circuit and special economic zone (KEK).
- Sekotong (West Lombok) – ideal for marine tourism and resorts.
- Sembalun (East Lombok) – suited for eco- and agro-tourism.
- The Gili Islands (Trawangan, Air, Meno) – international tourism hubs.
- Benang Stokel – a tranquil destination ideal for nature-based retreats.
- STEP 3: ESTABLISH A LEGAL BUSINESS ENTITY. To legally operate a business in Indonesia, investors must establish a legal entity. There are two main types of recognized investment schemes:
- PMDN (Domestic Investment) – for Indonesian nationals..
- PMA (Foreign Direct Investment) – for foreign investors or entities with majority foreign ownership.
- Minimum total investment: IDR 10 billion per 5-digit KBLI code (excluding land and buildings).
- Minimum paid-up capital: IDR 10 billion.
- In accordance with Presidential Regulation No. 10 of 2021 and BKPM Regulation No. 4 of 2021 on OSS-RBA Guidelines.
- STEP 4: ENGAGE A PROFESSIONAL BUSINESS AND LEGAL CONSULTANT. Establishing a business in Indonesia—especially in fast-developing tourism regions like Lombok—requires a solid understanding of both national and regional regulations. It is highly recommended to work with experienced legal and business consultants who specialize in:
- PT PMA establishment.
- OSS-RBA systems and procedures.
- Regional licensing, particularly in strategic zones like Mandalika (KEK).
It is also essential to review the relevant Indonesian Standard Business Classification (KBLI) codes to ensure your business plan aligns with the requirements of the OSS (Online Single Submission) system.
Your chosen location will also determine specific permit requirements such as Location Permits, Environmental Permits, and additional regional permits, especially if your business is located within a KSPN or KEK area.
Key requirements for PT PMA (Foreign-Owned Limited Liability Company):
The establishment process must be conducted through a notarial deed in Indonesian and legalized by the Ministry of Law and Human Rights (Menkumham).
Choosing the right consultant is a critical long-term investment decision. A qualified advisor will ensure your investment is legally protected, properly structured, and professionally managed for sustainable growth. Moreover, their expertise can help you avoid procedural errors and accelerate both the licensing and operational processes.
- STEP 5: COMPLETE BUSINESS LICENSING AND DOCUMENTATION VIA OSS-RBA. Once your legal entity is established, the next step is to secure all required licenses through the OSS-RBA system, as regulated under:
- Law No. 11 of 2020 on Job Creation.
- Government Regulation No. 5 of 2021 on Risk-Based Business Licensing.
- BKPM Regulation No. 4 of 2021.
- NIB (Business Identification Number): your company’s legal identity.
- Location and Environmental Permits: mandatory for property and tourism sectors
- Standard Certificates (SS) and Commercial/Operational Licenses: suited for eco- and agro-tourism.
- Regional Permits: such as those issued by ITDC for businesses in the Mandalika area or based on local zoning rules.
CONCLUSION : LOMBOK, a FUTURE-PROOF INVESTMENT DESTINATION.
With expanding infrastructure, its status as a priority national destination, and the streamlined digital licensing system, Lombok offers an exceptional investment opportunity—especially in the hospitality sector and beyond. With proper planning, a compliant legal foundation, and the support of experienced consultants, you can build a strong and sustainable business presence on this fast-growing island.