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UAE invests $10B in Indonesia

Abu Dhabi - Financing to focus on promising sectors that will contribute to economy, society

The UAE will invest $10 billion in Indonesia’s state fund, the Indonesia Investment Authority, which will be spent on projects inside the Southeast Asian country, the UAE’s state news agency reported on Tuesday.

The investment will be used for infrastructure projects, including roads and ports, as well as tourism, agriculture and other promising sectors that have potential for growth and can contribute to growth as well as economic and social progress, according to Wam.

Indonesian President Joko Widodo last month announced the members of the Indonesia Investment Authority’s board of supervisors and board of directors, which was formed under the Omnibus Job Creation Law passed in October 2020.

The setting up of the board is considered a turning point in the governance and development of the investment system in Indonesia.

The Indonesian sovereign fund is focused on strategic projects that support national development, including the development of infrastructure and the construction of the new capital in Kalimantan.

The UAE and Indonesia enjoy strong political, economic and cultural ties. Official diplomatic relations between the two countries began in 1976, with the Indonesian embassy in Abu Dhabi opening on October 28, 1978. The UAE embassy in Jakarta was inaugurated in 1991, following a historic visit by the late Sheikh Zayed bin Sultan Al Nahyan in 1990.

In 2020 January, Indonesia signed 11 business deals with the UAE worth a combined $23 billion covering investment in energy and other sectors.

In the petrochemical and gas sectors, Abu Dhabi National Oil Company signed deals with Indonesian firms Pertamina and Chandra Asri Petrochemicals.

Relations between the two countries have witnessed tremendous growth in recent years with an increase in mutual visits at the level of top leadership and senior officials, most notably the visit by Widodo in September 2015 to the UAE, and the visit by His Highness Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, to Indonesia in July 2019.

The two countries signed several agreements and cooperation deals. The two sides recently concluded UAE-Indonesia Week 2021, during which several agreements were signed relating to ports, logistics, strategic and defence industries, energy, tourism, the creative economy and mangrove farms.

In terms of trade and economic ties, there has been remarkable growth, with the volume of trade exchange reaching about $3.7 billion.

— issacjohn@khaleejtimes.com