Why Malaysia’s Tycoons Are Turning to Indonesia’s Digital and Logistics Boom
- simpleisgd
- Jun 1
- 2 min read
Malaysia’s richest business figures—once known for fortunes made in palm oil, hospitality, and retail—are now setting their sights on Indonesia’s digital economy. Visionaries like Robert Kuok (Wilmar) and Lim Kok Thay (Genting Group) are moving away from traditional sectors and quietly investing in tech, e-commerce, and logistics infrastructure across Southeast Asia’s largest market.
A Strategic Shift from Commodities to Clicks
Malaysian investment in Indonesia’s digital sector has surged, hitting US$905 million, with a record US$229 million in 2023, according to Tracxn. This signals a strategic shift, driven by Indonesia’s massive, youthful population, growing internet usage, and increasing consumer spending.
Neha Singh, CEO of Tracxn, attributes this momentum to post-pandemic recovery trends and the strong cultural and geographic ties between the two countries, making cross-border business easier and more attractive.
Investing in the Full Digital Ecosystem
It’s not just flashy consumer apps drawing attention—Malaysian investors are backing everything from e-sports to agricultural technology. Genting’s venture arm has invested in Evos Esports, a leading gaming platform, and Eratani, an agri-tech startup revolutionizing Indonesian farming. Meanwhile, Sunway Group’s Jeffrey Cheah partnered with Kejora Capital to fund promising Southeast Asian startups, with Indonesia as a core focus.
Carsome, Malaysia’s largest used-car platform, sees long-term value in Indonesia’s digital-first car buyers. Despite market challenges, CEO Eric Cheng says the company is doubling down—refining operations, enhancing inventory, and adapting its model to include in-person services to meet local preferences.
Building the Backbone: Logistics and Warehousing
As digital commerce grows, so does the need for strong logistics. Malaysian investors are responding by pouring capital into supply chain infrastructure. Robert Kuok’s Kerry Logistics entered a joint venture to improve inter-island distribution. Retail giant Mr DIY is expanding aggressively across Indonesia, supported by a national warehousing network that includes major hubs like the one in North Jakarta.
According to experts, modern logistics and warehousing—especially for industries like e-commerce and electric vehicles—are becoming hot investment targets, with strong potential for long-term returns.
Complex Terrain, Cutthroat Market
However, Indonesia’s archipelagic geography presents logistical challenges. High transportation costs and fragmented supply chains make nationwide delivery expensive and complex. Companies must balance tech innovation with practical, localized solutions.
Competition in Indonesia’s digital space is equally intense. Market leaders like Shopee and Tokopedia dominate, while others—such as JD.ID and Elevania—have exited after struggling to stay competitive. With price-sensitive consumers and high operational costs, turning a profit is tough. Analysts expect further consolidation, with only the strongest players surviving.
Betting on Indonesia’s Digital Future
Despite these hurdles, Malaysia’s business elites are betting big on Indonesia’s digital transformation. From e-commerce and gaming to agriculture and logistics, they’re positioning themselves for long-term growth in a market that's rapidly moving online.
It’s no longer just about land or oil—this new frontier is digital, and the race to lead it is well underway.
