Great! Indonesia And Dubai Invest IDR 107.1 Trillion To Develop Ports In Indonesia

Illustration. (Photo: Unsplash)

JAKARTA - The Indonesia Investment Authority (INA) and the logistics company, Dubai Ports World (DP World) are cooperating in the development of Indonesian marine and ports in the global manufacturing ecosystem. The economic value of this partnership can reach up to 7.5 billion US dollars or equivalent to IDR 107.1 trillion in the long term.

INA's Chief Executive Officer (CEO), Ridha Wirakusumah said the strategic partnership with DP World is in line with the company's mission to optimize investment in Indonesia's infrastructure sector and resources to provide long-term economic development.

Furthermore, according to Ridha, INA's investment focuses on several key sectors, such as airports, ports, toll roads, industrial estates, digital infrastructure, health services, and renewable energy.

Through this cooperation, said Ridha, the two parties will form a consortium and work team to explore investment in logistics infrastructure in Indonesia. Including inland investments, land terminals, park cargo, feeder network systems, land transportation, and industrial zones. Not only that, but the two will also explore cooperation with the Indonesian Port Company (Pelindo).

Ridha said DP World will seek to leverage its joint investment platform with Caisse de dépôt et placement du Québec (CDPQ) which since its launch in 2016 has invested in 12 port terminals globally at various stages of its asset life cycle.

"Indonesia's maritime and port sectors are key to supporting trade and consumption across the archipelago, and this collaboration with DP World will allow us to solve the problems of high logistics costs and port inefficiency", he said in a statement, Monday, November 1.

As is known, Indonesia is the largest archipelagic country in the world with more than 17,000 islands. With its geographical area, Indonesia relies on a strong domestic shipping network.

Despite historically lagging neighboring countries in terms of container traffic and currently facing high-cost logistics problems, said Ridha, Indonesia is already among the top 15 countries in terms of container traffic and has a lot of potentials to develop further.

Furthermore, said Ridha, the level of containers in Indonesia will only increase given the continued increase in domestic consumption and production.

"We are confident that DP World can work well with us to create a strong domestic shipping network and add value for investors, businesses, and employees. We would like to thank the Ministry of State-Owned Enterprises (BUMN), Ministry of Finance, Ministry of Transportation, other government agencies, and Pelindo for their strong support", he explained.

Meanwhile, CEO of DP World & MD Asia Pacific and Australasia Glen Hilton explained, through this collaboration, the company will introduce its global business best practices to Indonesia, including operational optimization, service innovation, disruptive technology, and safety principles. Including bringing advanced technology in logistics business management to the country.

The goal is that the system can be run automatically to eliminate inefficiencies, a hyperloop system for fast cargo delivery, and a 100 percent sustainable means of electric cargo transportation.

"Together with INA, we will focus on building mutually beneficial relationships with local governments and stakeholders to create value across Indonesia's supply chain. By combining our experience and disruptive technologies with INA's mandate to maximize economic impact, we are optimistic that we can improve chain performance. Indonesian supply", said Hilton.