Kontan Online

KERJASAMA

Jokowi-Abe will negotiate some large projects

Thursday, 12 January 2017 | Agus Triyono

JAKARTA. Prime Minister of Japan Shinzo Abe will visit Indonesia on Sunday (15/1). President Joko Widodo will use the visit to increase economic cooperation between the two countries. The government has even claimed to have prepared list of cooperation, which will be negotiated with Japan during the visit.

Aside of infrastructure projects, some energy projects will also be negotiated. According to Coordinating Minister of Maritime Affairs Luhut Pandjaitan, the giant infrastructure projects between Indonesia and Japan include the construction of Patimban Port with the total investment value of Rp 40 trillion.

The government has appointed Pelindo II to build cooperation with Japan’s side in constructing and operating the port, which is located in Subang, West Java.

To date, the government is still waiting confirmation from Japan about the private company, which will be involved in that project. “There are four options, including Astra and Mitsubishi,” Luhut said, Wednesday (11/1).

Previously, Minister of Transportation Budi Karya Sumadi said that the plan of Patimban Port project has been finalized in the last week. “We hope that is has been finalized also by the Japan’s side. Therefore, there will be two signings, between Ministry of Transportation and JICA, as well as between JICA and private operators during Abe’s visit,” he said.

Energy projects

The second project is Jakarta-Surabaya fast train. The Government of Indonesia expects that two countries will reach agreement on the financing scheme of the project during the visit. The project will cost about Rp 80 trillion-Rp 120 trillion investments. “Probably, there will be the signing of joint study between Ministry of Transportation with Japan International Cooperation Agency (JIC),” Luhut said.

The Government of Indonesia will also negotiate the Masela (South Maluku) Block during Shinzo Abe’s visit. Luhut claimed that previously Inpex Corp has agreed on the offer of contract extension for seven years. Initially, Inpex Corp asked for ten years contract extension. The contract extension is a compensation of the change in Masela Block’s exploration location. The government had also offered the additional capacities of liquefied natural gas (LNG) refineries, as well as the sunk cost payment as much as US$ 1.2 billion.

Aside of the three projects, the two countries will discuss the electricity infrastructure projects worth US$ 12 billion.

Minister of Foreign Affairs Retno Marsudi added, President Joko Widodo will also meet Japanese investors. President Joko Widodo will meet at least 30 chief executive officers (CEOs) of Japanese companies. “There will be collective audience with Japanese CEOs after the talk with the prime minister,” she said.

The Government of Indonesia hopes that the meetings will strengthen the economic and investment relations with the two countries. “Japan is one of the main partners of Indonesia’s economy,” Retno said.

To date, bilateral trade between Japan and Indonesia reached US$ 31 billion. In terms of investment, Japan is the second largest investor in Indonesia. During January-September 2016, the Japan’s investments in Indonesia amounted to US$ 4.5 billion.

(Muhammad Farid/Translator)

Reporter: Agus Triyono
Editor: Dupla KS