Lippo Group’s John Riady on his hopes, dreams for Indonesia – and the family business

In a wide-ranging interview with This Week in Asia, the third-generation inheritor said he had set his sights on elevating his home nation
Read on for the Jakarta-based CEO’s thoughts on the importance of growth, innovation – and why Indonesia is the next China

Indonesia

Su-Lin Tanin Singapore

Published: 11:30am, 2 Mar 2024

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By helping to turn emerging economies into economic powerhouses, influential Asian families have the ability to equip their homelands with “soft power” on the world stage, according to John Riady, scion of Indonesia’s Riady dynasty.

In a wide-ranging interview with This Week in Asia about his plans for the family business – the Indonesia-based conglomerate Lippo Group, one of Asia’s most visible corporate brands – the third-generation inheritor said he had set his sights on elevating his home country.

World leaders attend a working session at the G20 Summit in Nusa Dua, Bali, Indonesia on November 15, 2022. Photo: AP

Born and educated in the United States, the grandson of Indonesian billionaire Mochtar Riady steers Lippo Group as its CEO from Jakarta, where he lives with his wife and four children.

According to the younger Riady, emerging Indonesia is not only ready to graduate as an advanced economy, but in time, become a key global political player.

He said Indonesia had proven its credentials through its hosting of 2022’s G20 summit.

G20 in Bali is a big moment for middle powers like Indonesia

“During Indonesia’s chairmanship of the G20, it was a very difficult time … there were so many divisions,” he said. “Indonesia was, as a ‘constructive middle power’, able to effectively facilitate that sort of geopolitical togetherness.”

With a burgeoning middle class that’s forecast to number more than 80 million, up from fewer than 30 million just a few short years ago, Indonesia can leverage the maturing wealth of its growing pool of workers and consumers to fill the shoes of ageing South Korea and China, Riady said.

“In the last three decades, China has been ‘the miracle’, and rightfully so,” he said. “But today, I think we are looking for a new growth engine, a new growth story. That’s Indonesia.”

Visitors browse cars at the 2024 Indonesia International Motor Show in Jakarta last month. Photo: EPA-EFE

Growth drivers range from education to medical services and housing, with Indonesia – where home ownership currently stands at about 50 per cent – set to enter a “golden decade of home ownership”, according to Riady.

“This is a country made up of generations of firsts. It’s full of families who will experience many moments of firsts. The first time they travel abroad, the first time they send their kids to university, the first time they buy a house … every time they do that their life gets better,” he said.

“So if you ask me what we are focused on? Well, for the next two decades, we’re focused on Indonesia and Southeast Asia emerging from what they are today to hopefully becoming advanced economies.”

For the next two decades, we’re focused on Indonesia and Southeast Asia emerging from what they are today to hopefully becoming advanced economies

John Riady, Lotte Group CEO

As one of the fastest-growing economies in the Asia-Pacific, Indonesia has the capacity to outlast its regional rivals amid mounting geopolitical uncertainties and macroeconomic headwinds, Riady says.

But the country wasn’t always a top performer, with the culmination of decades of poor governance and corruption tanking the economy during the Asian financial crisis of 1997 as weak economic fundamentals such as fragile banks, a rigid exchange rate and over-reliance on foreign loans also took their toll.

The Lippo Group – now known for its slew of shopping centres across Indonesia and media interests such as the Jakarta Globe, as well as Singapore-listed developer OUE and its eye-catching namesake Lippo Centre tower in Hong Kong – hasn’t always been at the top of its game, either.

The sun reflects off the Lippo Centre in Admiralty, Hong Kong. Photo: Dickson Lee

In 2018, the group found itself caught in a corruption scandal after one of its employees was found guilty of bribing local officials to kick-start Lippo’s US$20 billion Meikarta housing megaproject in Jakarta.

The scandal hurt the group’s reputation and sank the share price of the project’s parent company. In its wake, Riady was parachuted in by the family as the new boss of the group’s property arm in 2019.

These days, he prefers to talk about ethics and “stewardship”, which extend further than just championing high-impact projects related to climate change and the like.

“We want to be stewards of our businesses,” he said. “That means that we have a responsibility to grow and to innovate … but it also means that these businesses serve the needs of the community at large.”