Jakarta (ANTARA) – The Indonesian Researchers Association (PPI) has urged the government to provide competitive fiscal incentives in implementing the International Financial Center (PFII) Law, saying they are essential for Indonesia to compete with global financial hubs in attracting investment.PPI Chairman Syahrir Ika said Indonesia's incentives must be designed not only to offer tax benefits but also to remain competitive with rival financial centers.“If other countries offer better incentives, investors will naturally choose those countries. The issue is not simply how large the incentives are, but whether they enable Indonesia to remain competitive against its peers,” Syahrir said in Jakarta on Friday.Syahrir, who is also a researcher at the National Research and Innovation Agency's (BRIN) Center for Economic Research, said the financial sector differs from the real sector because capital moves much more quickly, prompting investors to continuously compare Indonesia's incentives and business environment with those offered by countries such as Singapore, the United Arab Emirates, Malaysia, and Vietnam.He said fiscal incentives are a common policy instrument used to improve a country's investment competitiveness.However, experience shows that tax incentives alone are insufficient to attract investors without a supportive business ecosystem.“Fiscal incentives are necessary, but they cannot stand alone. Investors evaluate not only taxes, but also political stability, policy consistency, regulatory quality, infrastructure, and business certainty,” said Syahrir, a former researcher at the Finance Ministry's Fiscal Policy Agency.He therefore stressed that implementation of the PFII Law should be supported by complementary policies that offer both competitive incentives and a predictable investment environment for global businesses.At the same time, Syahrir cautioned the government against undermining fiscal sustainability when designing incentive packages.Efforts to strengthen competitiveness, he said, should not come at the expense of Indonesia's fiscal health, as doing so could increase perceptions of economic risk.“The government needs to determine the optimal level of incentives. We must remain competitive without compromising fiscal space, because that would ultimately increase economic risks,” he said.Beyond fiscal incentives, Syahrir said the establishment of the PFII should serve as an opportunity to strengthen Indonesia's financial sector by deepening financial markets, improving regulations, advancing financial technology, enhancing human capital, and reinforcing good governance.According to him, the long-term competitiveness of an international financial center depends primarily on the strength of its overall ecosystem rather than on the size of its tax incentives.“The establishment of the PFII should be used to improve Indonesia's financial ecosystem. What needs to be built is not only the incentive framework, but also the foundation for a stronger, more efficient, and globally competitive financial sector,” he said.Syahrir also urged the government to maintain a level playing field so that incentives provided within the PFII do not create unfair competition for businesses operating outside the designated zone.He said the incentive framework should enhance Indonesia's attractiveness as an international financial center without creating market distortions or unequal treatment that could undermine the broader business climate.Syahrir expressed confidence that the government had conducted extensive studies in designing the PFII incentive scheme. Nevertheless, he said Indonesia should continue learning from established international financial centers to ensure its policies improve competitiveness without creating distortions or weakening long-term fiscal sustainability.He also welcomed the establishment of the PFII as a strategic initiative to capitalize on global investment opportunities, describing it as evidence of the government's forward-looking approach to shifts in the global economy and financial system.“It shows that the President has a strategy. He understands the changes taking place in the global economy and financial system and is seeking to seize those opportunities. That is a positive step that deserves appreciation. I give high marks to this effort to capitalize on the current momentum,” he said.