Indonesia Gains New Investment Deals

KOMPAS/BENEDIKTUS KRISNA YOGATAMA

President Joko Widodo (fourth from left) and his entourage take pictures in front of the Indonesia Pavilion Dubai Expo 2020, Thursday (4/11/2021). He was accompanied by Coordinating and Investment Minister Luhut Binsar Pandjaitan (second from left) and Trade Minister Muhammad Lutfi (third from right). They took a photo with a number of officials from the United Arab Emirates.

Indonesia has gained US$35 billion in investment commitments at the Dubai Expo 2020, with a portion of the investments allocated for emission-free programs.

DUBAI, KOMPAS — Indonesia recorded new investment deals worth US$35 billion (Rp 503 trillion) at the Dubai Expo 2020 in the United Arab Emirates, with partnership commitments in renewable energy, tourism, health, and infrastructure.

The new investments in the energy sector are in line with Indonesia’s energy transition policy to achieve zero emissions by 2060.

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According to Trade Minister Muhammad Lutfi, some $10 billion of the total investment value will be channeled to the sovereign wealth fund, the Indonesia Investment Authority (INA). The rest are intended to realize previous commitment, among them Pertamina's Balikpapan refinery development program.

"We are targeting technology transfers for Indonesia through the investments," Lutfi said at Dubai Expo 2020 on Friday afternoon local time (11/5/2021).

The deals were made during the two-day event from 3 to 4 Nov. Investment Minister Bahlil Lahadalia, who was part of President Joko Widodo’s entourage, said the details of the investments would be announced on their return to Jakarta.

Coordinating Maritime Affairs and Investment Minister Luhut Binsar Pandjaitan, Coordinating Economic Affairs Minister Airlangga Hartarto, Industry Minister Agus Gumiwang Kartasasmita, State-Owned Enterprises (SOEs) Minister Erick Thohir, Maritime Affairs and Fisheries Minister Sakti Wahyu Trenggono, Foreign Minister Retno Marsudi, and Cabinet Secretary Pramono Anung also accompanied President Joko “Jokowi” Widodo on his Dubai visit.

Energy transition

Addressing the Indonesia-UAE Investment Forum, President Jokowi revealed that at least $35 billion was needed to build Indonesia's new capital city [in East Kalimantan]. He also pledged Indonesia’s commitment to working towards an energy transition by inviting investors and pursuing affordable technology.

“If you are interested in investing in new and renewable energy, this is the time. Indonesia's potential is enormous and abundant: hydro, solar, geothermal, and many others," the President told UAE investors on Thursday (4/11).

KOMPAS/BENEDIKTUS KRISNA YOGATAMA

Minister of Trade Muhammad Lutfi at the Indonesia Pavilion, Dubai Expo 2020, Tuesday (2/11/2021).

One SOE seeking an energy cooperation agreement is PT Pertamina Power Indonesia, a subsidiary of PT Pertamina (Persero), which signed a deal with Abu Dhabi-based renewable energy company Masdar. The two parties are to explore the joint development of floating solar power plants (PLTS) and clean energy solutions in Indonesia.

“This collaboration is very important in driving Indonesia's energy transition. This strategic collaboration with Masdar can potentially accelerate the energy transition," said Pertamina president director Nicke Widyawati.

Contacted separately, executive director Fabby Tumiwa of the Institute for Essential Services Reform (IESR) said that Indonesia’s dynamic energy transition had attracted many investments.

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Indonesia was viewed as an important and strategic country in the emissions reduction program, an issue raised during the ongoing 26th United Nations Climate Change Conference of the Parties (COP 26) in Glasgow, Scotland.

“To facilitate investment flow in Indonesia’s renewable energy sector, the government must be able to unravel the obstacles and risks in the field. The government must also actively communicate with developed countries and funding institutions to support its energy transition program," Fabby said.

AFP

Visitors are pictured in the Israel pavilion during a media tour ahead of the opening of the Dubai Expo 2020 in the Gulf Emirate on September 27, 2021. - The six-month world fair, featuring exhibitions by 192 countries, is expected to attract more than 20 million international visitors when it opens on October 1 after a year's Covid delay.

One of the government’s efforts to attract international collaboration is the establishment of the Friends of Indonesia-Renewable Energy (FIRE) dialogues, which was announced at COP 26 on Thursday local time. A number of countries, such as Germany, the United Kingdom and Denmark, have pledged their support for the FIRE program. (BKY/CAS/WKM/JUD/APO)

(This article was translated by Musthofid).