Province

Riau

Overview Economy

Riau, the homeland of the Malay people

Tucked away on Sumatra's eastern shore, Riau is a province home to around 7.18 people, as of 2022. The province stands as a symbol of Indonesia’s rich cultural diversity, natural resources, and vibrant economy. Its varied landscapes, diverse ecosystems, and blend of cultures have positioned the province as a region of significant environmental and economic contributions to the country.

Rich plains, coastal regions, and rainforests form the varied topography of Riau, with the region’s abundance increased by numerous rivers, such as the Siak and Indragiri rivers. Moreover, a diverse range of flora and fauna, including endangered species such as the Sumatran tiger, orangutan, and Riau peacock, may be found in the province’s tropical rainforests.

Riau’s natural environment offers a variety of tourist destinations. Examples include Ulu Kasok in Kampar, dubbed the “Raja Ampat of Kampar” for its natural beauty; Jemur Island, which is home to groups of islands serving as the natural habitat of several turtle species; and the Kampar River, which attracts surfers worldwide with its unique waves.

Furthermore, Riau boasts historical sites with distinct religious backgrounds, such as the Muara Takus temple, Agung An-Nur Mosque, and the Siak Sri Indrapura Palace. Historically, Riau has also served as a hub of exchange and trade, with commercial routes crossing the province. This historical aspect is reflected in Riau’s multiculturalism, with its diverse ethnic groups such as the Chinese, Minangkabau, and Malay communities adding to the province’s cultural tapestry.

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Economic sector

Due to its strategic location along the Malacca Strait, Riau is well-positioned to facilitate investment and commerce, acting as a gateway to global trade routes. The province benefits from access to road, air, and sea transportation networks. Notably, Pekanbaru and Dumai ports are important hubs for the export of goods such as rubber, lumber, and palm oil. Furthermore, the province's growing infrastructure, including airports, industrial zones, and highways, enhances its appeal to investors and business owners.

Nationally, Riau is renowned for its production of rubber, timber harvesting, and oil and gas extraction, all of which significantly impact Indonesia’s Gross Domestic Product (GDP) and export revenues. The province also significantly contributes to the country's forestry and palm oil industries, as well as the oil and gas industry, hosting substantial extraction and refining facilities.

Riau’s Gross Regional Domestic Product (GRDP) reached Rp 506.4 trillion in 2021 and increased to Rp 529.5 trillion in 2022. Mining emerged as the largest contributor to Riau’s GRDP in 2021 and 2022, accounting for 34.20 percent and 36.62 percent of the total, respectively. The processing industry followed closely at 9.14 percent in 2021 and 10.03 percent in 2022. Additionally, the transportation and warehousing industry, as well as the finance and insurance industries, form part of significant contributors to Riau's GRDP.

Moreover, Riau has made significant efforts in expanding investments. For example, between January and June 2023, the province successfully secured Rp 49.1 trillion from both local and foreign investment sources, marking a 10.6 percent increase from the previous year.

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Latest News

February 3, 2025

Riau Province has become the province with the highest investment realization on Sumatra Island for the fourth consecutive year in 2024. At the national level, Riau is ranked sixth.

"There was an increase of 12.53 percent year-on-year [in realized investments to Riau] in 2024 compared to 2023." said the Riau Province One-Stop Investment and Integrated Services Office (DPMPTSP) Head Helmi stated on Jan. 31, 2025.

Riau has continued to show a positive trend in investment realization for the past five years, although realized investments to the province the last two years were below target for the past two years.

In 2020, realized investments to Riau exceeded the R40.81 trillion target to reach Rp49.64 trillion. The dominant investment sector at that time was construction, with an investment value reaching Rp10.7 trillion. In addition, investments to the province also had a major impact on jobs created that year, resulting in employment for 123,126 people.

Investments to Riau continues to increase in 2021, surpassing its Rp49.1 trillion target to reach Rp53.05 trillion. The paper and printing industry was the dominant sector, accounting for Rp11.1 trillion of total investments. However, the number of jobs created decreased to 61,195 jobs.

In 2022, rapid investment growth led to realized investments to the province far exceeding the Rp60.48 trillion target to reach Rp82.5 trillion. The most dominant sector that year was the electricity, gas, and water sector, which accounted for Rp20.8 trillion of total investments.

However, although realized investments to Riau was still high in 2023, reaching Rp78.47 trillion, it was below the Rp90 trillion target. The forestry sector attracted the most investment that year. Meanwhile, the investments led to employment for 65,189 people.

Total realized investments saw a significant increase in 2024 to reach Rp88.3 trillion, although still below the Rp106.07 trillion target for that year.

"The continuously increasing investment value indicated that Riau is still the main investment destination [in Sumatra Island], with a real impact such as for job creation," Helmi added.

The forestry sector is still the dominant sector that year. Realized investments also resulted in employment for 97,201 workers, the highest figure in the past two years.

Going forward, the Riau Provincial Government will continue to strive to increase the province's investment attractiveness by encouraging leading sectors and creating a more business climate more conducive to investment.

 

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