Indonesia and the UAE have struck nearly $23bn in business deals, more than half of which will be used to fund a petrochemical plant in west Java, Jakarta announced today.
The investments will be made through a new Indonesian sovereign wealth fund, which will also attract funding from Japan’s Softbank and the US International Development Finance Corporation.
The $12.6bn petrochemical plant will be developed by Pertamina, Indonesia’s state energy firm, and the Abu Dhabi National Oil Company. Other investments will be in ports, renewable energy and agriculture.
Another notable project was agreed between Indonesia’s Pembangkit Jawa Bali Investasi and Abu Dhabi-based renewable energy company Masdar to construct a $129m, 145MW floating solar power plant at Cirata Dam, also in west Java. When complete, it is expected to be the largest solar plant in Southeast Asia.
The announcement comes after a meeting in Abu Dhabi this weekend between Joko Widodo, the president of Indonesia, and Crown Prince Sheikh Mohammed Bin Zayed, the UAE’s deputy supreme commander.
President Jokowi also asked Zayed to lead the steering council for the development of Indonesia’s new capital in Kalimantan, Luhut Pandjaitan, the minister for maritime affairs, told a press conference yesterday.
Pandjaitan said: "We specifically discussed the development of a new capital city. Hence, with this sovereign wealth fund, the Crown Prince expressed his commitment to join."
Indonesia’s leader has said he will focus his second term on attracting foreign investment to Southeast Asia’s biggest economy and maintaining its multi-billion-dollar infrastructure construction programme.
Image: President Joko Widodo and Sheikh Mohammed bin Zayed (ANTARA/HO-Indonesian State Palace Public Relations)
- Edited 15 January to correct the location of the new capital