Province

South Sumatra

Overview Economy

South Sumatra, the province divided by Musi river

Sumatra Island’s eastern coast is home to South Sumatra, a province of 8.89 million people as of 2023. The province’s capital city is Palembang, a city that serves as a blend of modernity and tradition, thereby contributing to South Sumatra’s presence as a cultural melting pot where traditions and customs rooted in Java, Palembang, and Malay culture exert a significant influence. Additionally, the province’s local cuisine reflects this diversity, featuring spicy and savory meals as staples.

Furthermore, a highlight of South Sumatra's cultural legacy is the annual Sriwijaya Festival, which honors the historical Sriwijaya Kingdom that once flourished in the area. The festival showcases the province’s rich cultural diversity through traditional performances, art exhibitions, and gastronomic events.

With a varied terrain that includes mountains, forests, and plains, South Sumatra’s natural landscape notably is cut by numerous rivers, among them the Musi River, which plays an essential role in the region’s agricultural and transportation networks. Particularly, the Ampera Bridge spans the Musi River, further contributing to the region’s connectivity and infrastructure.

Moreover, South Sumatra’s vast landscape supports a wide variety of plants and animals. These include the critically endangered Sumatran tiger and rhinoceros, housed in the UNESCO World Heritage site of Bukit Barisan Selatan National along with a variety of other animals.

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Economic landscape

South Sumatra’s economy, as of 2023, is reflected in a Gross Regional Domestic Product (GRDP) of Rp 360 trillion. Driving this GRDP are several sectors, with the mining sector leading with a contribution of 26.61 percent, followed by the processing industry sector, and the agriculture, forestry, and fishery sector.

Moreover, the province contributes significantly to the country's palm oil industry due to its vast plantations. Additionally, natural resources such as coal and rubber contribute significantly to both the national and local economies.

In 2023, South Sumatra province attracted Rp 36.80 trillion in investment up to the third quarter of the year. During this period, both domestic and foreign investments were nearly identical, with Rp 18.67 trillion and Rp 18.12 trillion, respectively. Among international sources of investment, Singaporean businesses led the way with Rp 12.19 trillion, followed by China at Rp 2.63 trillion, Hongkong at Rp 1.67 trillion, Japan at Rp 665 billion, and Malaysia at Rp 319 billion.

Five major sectors enjoyed investment in South Sumatra during that period, namely the paper and printing industry with Rp 10.81 trillion in investments, the mining industry at Rp 5.61 trillion, the energy industry at Rp 4.67 trillion, the food industry at Rp 3.43 trillion, and the transportation, warehousing, and telecommunication industry at Rp 3.04 trillion.

To sustain the flow of investment into the province, South Sumatra is supported by the Trans-Sumatra Highway, connecting the province to Lampung. Notably, the Palembang-Lampung route reduces travel time from 10-12 hours to only 3.5 hours. Significant investments have been made in this highway, including the Indralaya-Pramubulih route, which received an investment of Rp 12.5 trillion.

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Latest News

March 9, 2026

PT Hutama Karya (HK) signed a credit facility agreement with a syndicate of banks to finance the construction of the Betung-Tempino-Jambi section of the Trans Sumatra Toll Road. The signing ceremony took place on Feb. 23. 2026, at the HK Tower Ballroom in Jakarta. The Rp 13.64 billion syndicated loan for Bank Mandiri, PT Bank Rakyat Indonesia (BRI), Bank Syariah Indonesia (BSI), PT Sarana Multi Infrastruktur (SMI), Bank Central Asia (BCA), and Bank Mega.

The Betung-Tempino-Jambi toll road section itself is planned to be approximately 170.73 km long and is the main corridor of the Trans Sumatra Toll Road, connecting Betung District, Banyuasin Regency, South Sumatra Province, to Jambi City, Jambi Province.

PT HK Executive Vice President (EVP) and Corporate Secretary Mardiansyah explained that the presence of this toll road section will integrate the toll road network from south to north. Connectivity between regions on this main logistics route will thus be strengthened.

"The presence of this section is projected to improve travel efficiency. According to a CORE (Center of Reform on Economics) Indonesia study [in 2024], travel time savings on this section will be about 59.05 percent. This increased efficiency is expected to also impact safety, comfort, and the quality of transportation services for the public," he said in a written statement on Feb. 23, 2026.

Furthermore, this toll road section is expected to streamline the distribution of goods and services and boost local economic activity. With an increasingly solid funding structure, construction implementation is expected to proceed more consistently, allowing for gradual economic and connectivity benefits. This credit facility agreement from a banking syndicate represents a strategic step to meet the project's funding needs.

"PT HK appreciates all parties who contributed to the realization of this syndicate collaboration. We are optimistic that the synergy that has been established will continue and provide maximum benefits to the community, while strengthening the foundation of the national economy towards an advanced, resilient, and globally competitive Indonesia," Mardiansyah concluded.

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