Coordinating Minister Airlangga Invites Japan To Invest In Indonesia For Health And Food Sector

JAKARTA - Coordinating Minister for the Economy, Airlangga Hartarto, invited Japan to invest in the health and food sector in his meeting with the Governor of the Japan Bank for International Cooperation (JBIC) Nobumitsu Hayashi.

"The health sector has developed health services in the Special Economic Zone, namely the health SEZ in Sanur Bali. In the SEZ it is allowed to conduct clinical-trial research and allow foreign doctors to practice", said Coordinating Minister Airlangga in an official statement, quoted from Antara, Tuesday, July 26.

Airlangga reminded that in line with the global crisis, one of which was in the field of food and fertilizer, he also invited JBIC to finance it.

Governor Hayashi responded by strongly supporting investment in food and fertilizer which increases as the population grows.

"However, this food and fertilizer require a good supply chain. JBIC will strongly support new investments in food and fertilizer", said Hayashi.

Airlangga also said that JBIC played a major role in Indonesia's economic development as a source of funding and advisor for various infrastructure projects.

JBIC annually surveys Japanese manufacturing companies doing business outside of Japan (Survey on Overseas Business Operations by Japanese Manufacturing Companies). However, in the 2021 survey results, from the "Promising Countries for Overseas Business" list, Indonesia is still ranked 6th or below Vietnam and Thailand.

Therefore, said Airlangga, Indonesia wants to be higher than Vietnam and Thailand. This is the main reason why he, accompanied by the Minister of Industry, Agus Gumiwang, met with JBIC in Tokyo.

JBIC has a specialty, one of which is financing in the energy sector, and Coordinating Minister Airlangga wants JBIC to be involved in several major infrastructure projects such as the Tanjung Jati-B power plant, Jawa 1, and the Sarulla and Muara Laboh geothermal plants, as well as the Tangguh LNG project.

"These projects provide a much-needed source of energy for Indonesia's economic development", said Airlangga.

In addition, the meeting also discussed the Masela Project which will become increasingly strategic, especially after the Ukraine and Russia wars and due to the soaring gas demand of the G7 countries.

Gas is very important because it can be used as raw material for ammonia, fertilizer, and gas can also be used to build methanol, which is one of the blends for biofuels. The investment value of this project reaches 19.85 billion US dollars.

However, the project has challenges ahead, namely the acceleration of energy transition, decarbonization requirements, and changes in the upstream oil and gas industry, so it needs to be evaluated and re-identified regarding the scope of the project.

In addition to discussing energy, the meeting also discussed the development of the automotive sector in Indonesia. In Indonesia, almost 90 percent of the principals are from Japan and JBIC has contributed to financing the development of the automotive sector.

"We support the investment of Japanese companies in the manufacturing sector, especially in the automotive sector, because with the strong support of the Government of Indonesia so far, Japanese automotive has become much loved in Indonesia and even more so in Japan itself. JBIC will further encourage an increase in the value of existing investments", explained Hayashi.

On this occasion, Minister of Industry, Agus Gumiwang, hoped that there were large manufacturing industrial projects in Indonesia that JBIC could support. Hayashi also welcomed Minister Agus' expectations and promised to continue to support Japanese companies' investment in the manufacturing industry, especially the automotive sector.

"Indonesia is a very strategic country and is JBIC's most important customer, therefore I am very happy to be able to meet directly with Coordinating Minister Airlangga and Minister Agus. JBIC's support in the energy sector by supporting 11.6 GW of electricity is very helpful for Indonesia's economic development", said JBIC Governor Hayashi.

"We are very pleased to hear that major projects in Indonesia will be a priority for JBIC. Indonesia, which has the largest population and economic size in the region, is very appropriate to be JBIC's top priority", said Coordinating Minister Airlangga.