Minister of trade, Muhammad Lutfi, said that Indonesia reached a trade agreement with China worth of US$1.38 billion during his visit together with state own enterprises minister, Erick Thohir, and foreign minister, Retno Marsudi end of last week - Photo by Indonesian Embassy for China

JAKARTA (TheInsiderStories) – Minister of trade, Muhammad Lutfi, said that Indonesia reached an investment and trade agreement with China worth of US$2.71 billion during his visit together with state own enterprises (SOEs) minister, Erick Thohir, and foreign minister, Retno Marsudi, on April 1- 3. He conveyed that in the next three years, both countries are committed to increasing exports by three times, from around $31 billion to $100 billion in 2024.

“The trade agreement comes from the commitment of six Chinese companies that will import swallow’ nest products, tropical fruit, especially pineapples, porang, palm sugar and furniture,” Lutfi told the media in a joint press conference held on Friday (04/02).

He has met with five companies that will import swallow’ nests from Indonesia with a value of more than $1.13 billion, furniture over than $200 million, and investments amounted to $1.38 billion. For furniture products, he explained, the Shandong Jinruyi Group expressed its interest in investing in Indonesia.

A number of meetings has been held between Lutfi and government officials of Fujian Province, China’ deputy minister of trade, Zhang Ziangchen, and the state councillor/foreign minister of China, Wang Yi. In addition to the trade and investment agreement, said Lutfi, the two countries agreed to explore deeper economic cooperation by reforming the bilateral Economic and Trade Cooperation scheme that has been in place since 2011 to become a Trade and Investment Facility Agreement (TIFA).

Indonesia and China also agreed to optimize existing agreements such as the ASEAN – China Free Trade Agreement scheme and the Regional Comprehensive Economic Partnership. The two countries also agreed to strengthen multilateral trade within the framework of the World Trade Organization (WTO).

The Chinese government hopes that Indonesia can support the Investment Facilitation proposal being initiated at the WTO. In general, the three ministers agreed to strengthen the commitment of the two countries regarding regional issues, economic cooperation, investment, education, and handling of the pandemic, economic recovery, and accelerated vaccination.

While, Thohir also talked with the investors on the development of electric vehicle (EV) battery project values of US$5 billion investment in the country. The lithium battery project is run by the consortium of PT Pertamina, PT Perusahaan Listrik Negara, PT Aneka Tambang Tbk (IDX: ANTM), and PT Indonesia Asahan Aluminium and Chinese firm, Contemporary Amperex Technology Co. Ltd., (CATL).

He also met with vice chairman of State-owned Asset Supervision and Administration (SASAC), a Chinese government agency that manages 97 Chinese SOEs, Ren Hongbin. Both agreed to review several cooperation projects in the electricity sector and world-class fisheries investment cooperation for Eastern Indonesia. 

Based on data from the statistic bureau, Indonesia’ exports to China in 2020 were recorded at $31.78 billion, an increase of 13.64 percent compared to the previous year. Meanwhile, the total trade between the two countries in the same year was recorded of $71.41 billion.

Written by Editorial Staff, Email: theinsiderstories@gmail.com