In a meeting of government representatives earlier this year, the Indonesian government showed a keen interest in welcoming Chinese investments across various sectors within its economy as part of its flagship BRI investments. The Indonesian representatives presented an investment opportunity to the Chinese investors along 28 projects that are roughly worth $127.5 billion altogether. These projects span a number of industries and sectors from ports, industrial estates, tourism and ore smelting to power plants. All of these projects are concentrated in the four Indonesian provinces; North Kalimantan, North Sumatra, North Sulawesi, Bali and North Sulawesi. The Indonesian government hoped to reach a quick deal on two to three projects out of the proposed 28 projects. It is evident that Indonesia is keen on attracting Chinese investment that is related to the grand Chinese BRI investments.
Indonesia clearly understands that it stands to benefit a great deal from the entire infrastructure and the developmental investments that have been the defining feature of the Chinese BRI project. In the second Belt and Road Forum in Beijing held a few months ago, Indonesia was a keen participant. Although the Indonesian president did not make an appearance himself, the high level Indonesian delegation at the summit was led by the vice president. Over 20 agreements were reached on the sidelines of this summit.
Chinese investors have also started to show a keen interest in the Indonesian markets. Indonesia is the largest market in the South East Asian region, with a growing middle class and a vibrant startup scene. The keenness showed by the Indonesian authorities provides Chinese investors a lucrative opportunity to tap into Indonesia’s 269-million strong markets.
A recent investment came in the form of pharmaceutical investments. The Indonesian ambassador to China was happy to announce that a Chinese firm, Bio-Medical Technology (BGBMT) Co Ltd, will be making a substantial investment in the pharmaceutical sector. The Chinese firm is setting up a pharmaceutical factory in West Jakarta that will fetch a Rp 580 billion Chinese investment in the Indonesian economy.
This will not only carter to Indonesia’s large demand for pharmaceutical raw materials but will also create employment opportunities for Indonesians. Such an investment will further go on to cement the ties on a business to business level between the two countries. The factory will be completed in 10 years and will cover an expansive are of 25000 square meters.