Tag: Indonesia and China business

Minister of Industry Agus Gumiwang Kartasasmita invited Xiaomi to expand its investment in Indonesia, including building an electric car ecosystem. He also directly praised Xiaomi’s investment and contribution to building the smartphone and television industry ecosystem in Indonesia. This was revealed after a bilateral meeting with Jon Dove, Associate Government Affairs Director of Xiaomi Communications Co., Ltd., in Shanghai, China, Friday (10/10/2025).

The meeting was also attended by Eko S.A. Cahyanto, Secretary General of the Ministry of Industry; Setia Diarta, Director General of Metal, Machinery, Transportation Equipment, and Electronics (ILMATE) Industry; and representatives from PT Xiaomi Technology Indonesia, namely Zhao Wentao (Managing Director) and Tel Lee (Product Certification Manager). Agus stated that the Ministry of Industry continues to strive to encourage cooperation with global industry players, including those from China, to strengthen investment flows into Indonesia and establish Indonesia as a manufacturing production and export base. According to him, this effort will accelerate the strengthening of the domestic industrial structure and spur national economic growth.

“Xiaomi has become a vital part of strengthening the national electronics industry supply chain. The Indonesian government greatly appreciates Xiaomi’s commitment to continuously investing and developing its product line in Indonesia,” Agus said in an official statement on Monday (10/13/2025).

Minister of Industry Urges Xiaomi to Build Electric Cars: The Indonesian government, he said, supports Xiaomi’s plan to produce tablets locally in Indonesia, particularly for models already present in the domestic market. Agus then asked Xiaomi to submit its business plan in Indonesia for the coming years. This includes encouraging Xiaomi to strengthen its electric car industrial base in Indonesia.

“We encourage Xiaomi to immediately submit a detailed business plan for the next five years, in order to realize its new investment plans in Indonesia. This plan is expected to include a strategy for developing production facilities, both independently and in collaboration with local partners,” he added.

“We are aware that Xiaomi has launched a high-performance electric vehicle, the Xiaomi SU7. We encourage Xiaomi to explore investment in the environmentally friendly vehicle sector in Indonesia. This will enrich vehicle choices for Indonesian consumers while strengthening the national green industry ecosystem,” said Agus.

He stated that the Chinese multinational technology company, founded in 2010 and based in Beijing, has invested IDR 3 trillion in Indonesia. This investment is being used to produce smartphones, tablets, and televisions.

“This company is now one of the leading smartphone brands in the national market, with a market share of 21% in the second quarter of 2025. Xiaomi’s investment contributes significantly to job creation, technology transfer, and strengthening the competitiveness of the national electronics industry. This aligns with the Making Indonesia 4.0 vision, which places the electronics sector as a top priority,” Agus said.

October 13, 2025, CNBC Indonesia

(https://www.cnbcindonesia.com/news/20251013164939-4-675399/menperin-minta-xiaomi-investasi-mobil-listrik-di-ri)

The 2025 Indonesia MotoGP at the Mandalika International Circuit in West Nusa Tenggara (NTB) recorded 140,324 spectators, a 15.7 percent increase from last year, marking the highest attendance since the event was first held in 2022. Maya Watono, president director of state-owned tourism holding company InJourney, said this year’s MotoGP was the best so far in terms of service quality, infrastructure readiness, and local community involvement.

“Hotel occupancy in Mandalika reached 100 percent. This was supported by close coordination with partners to add extra flights to meet high visitor demand,” she said in a statement on Sunday.

According to data from the NTB Tourism Agency, hotel occupancy across Lombok Island averaged 93 percent during the race period, with Mataram City at 90 percent and Mandalika at 100 percent. To accommodate the surge in travelers, Lombok International Airport operated 44 additional flights. Local micro, small, and medium enterprises (MSMEs) also benefited from the event, with the number of permitted vendors inside the circuit area nearly doubling from last year. Overall, the NTB provincial government estimated total economic turnover, including accommodation, transportation, culinary businesses, and local creative products during the race weekend at around IDR 4.8 trillion (US$289 million).

Susiwijono Moegiarso, secretary of the coordinating economy minister, said the success of the 2025 Indonesia MotoGP demonstrated the effectiveness of the Mandalika Special Economic Zone (SEZ) as a catalyst for regional economic growth.

“President Prabowo Subianto has requested direct reports on the development of all SEZs and their positive impacts, particularly Mandalika, which has significantly contributed to regional economic growth,” said Susiwijono, who also serves as chairman of the National Council for SEZs.

The Mandalika SEZ has recorded IDR 5.7 trillion in realized investment, creating 19,010 jobs and hosting 28 active businesses within the area. Ahmad Fajar, director of finance and risk management at the Indonesia Tourism Development Corporation (ITDC), which oversees the development of the Mandalika complex, said the development and management of the Mandalika Circuit were not focused solely on short-term financial returns but also on long-term benefits for the local economy.

“The government’s main focus is not merely on return on investment, but on sustainable socioeconomic impacts for the people of Lombok and NTB,” he said. The government reaffirmed its commitment to sustaining Mandalika’s development as a hub for tourism, sports, and international investment, including plans to introduce efficient transport services such as seaplanes to improve connectivity with other destinations.

October 6, 2025, The Jakarta Post(https://www.thejakartapost.com/business/2025/10/06/mandalika-motogp-draws-record-crowd-289m-economic-boost.html)

The Quick Response Indonesia Standard (QRIS) system will tap into China’s two dominant digital payment platforms, Alipay and WeChat, as part of Bank Indonesia’s (BI) ongoing expansion into the country. The integration is currently underway, with full implementation expected by the end of this year. BI payment system policy director Ryan Rizaldy said QRIS would be linked to those two platforms, though the integration had faced challenges due to diverging standards.

“We are seeking high merchant acceptance in the partner country, so that Indonesians can use [QRIS] at many merchants [in China]. That’s why we can’t make a deal with only one [payment provider],” he told reporters on the sidelines of a public discussion held by the Centre for Strategic and International Studies (CSIS) on Wednesday.

Ryan emphasized that the goal was to ensure QRIS could be “readable” for all merchants in China, adding that “the People’s Bank of China [PBoC] has the solution.” He explained that the PBoC would help link QRIS with both Alipay and WeChat without creating a new standard, though he did not provide further details on the integration mechanism.

BI had previously announced its collaboration with the PBoC to begin an “interconnection trial” between the two countries ahead of the planned expansion to China. The trial involves the Indonesian Payment System Association (ASPI), China’s UnionPay International (UPI), and representatives of payment system providers.

ASPI head Cosmas Setiawan Suwono said in August that the trial was expected to be completed “within this month,” allowing piloting to begin in September. The central bank said in April that four local payment service providers, PT Rintis Sejahtera, PT Alto Network, PT Artajasa Pembayaran Elektronis, and PT Jalin Pembayaran Nusantara, had reached an agreement with UnionPay International to create a secure testing environment, or sandbox.

During his session at the public discussion, Ryan highlighted that harmonizing policies remained the main challenge in implementing cross-border QR payment initiatives, noting that many countries, including China, had no unified standards. Other challenges included limited awareness of cross-border payment services in both Indonesia and partner countries, differing payment preferences, and growing concerns about potential fraud as the system expands. The central bank has already extended its QR technology to several ASEAN countries and beyond, including Singapore, Malaysia, Thailand, and most recently, Japan in August. In addition, it has placed several other countries in the pipeline, such as India, the United Arab Emirates (UAE) ,and Saudi Arabia.

Asked about the current expansion plan in the ASEAN region, Ryan hinted that priority would be given to countries with “stronger economic ties” and “higher transaction potential,” given the high costs of linkage and the varying economic scales across countries. However, he added that implementing cross-border payments with other regional countries such as Vietnam, Laos, and Cambodia was also possible, as they were already part of the regional payment connectivity (RPC) initiative. The adoption of QRIS among consumers and merchants has been surging at home, with the transaction volume of digital payments using the QR platform growing 148.5 percent year-on-year (yoy) to 6.1 billion in the first half of this year.

October 2, 2025, The Jakarta Post

(https://www.thejakartapost.com/business/2025/10/02/bi-to-link-qris-with-alipay-wechat-standards-in-china-push.html)

The Central Statistics Agency (BPS) recorded a surplus of US$5.49 billion in goods trade as of August 2025. BPS Deputy for Production Statistics, M. Habibullah, explained that Indonesia’s trade balance had recorded a surplus for 64 consecutive months since May 2020.

“The surplus in August 2025 was largely supported by a surplus in non-oil and gas commodities of US$7.5 billion, with animal and vegetable fats and oils, mineral fuels, and iron and steel contributing to the surplus,” he said in a BRS release on Wednesday (1/10/2025).

At the same time, the oil and gas trade balance recorded a deficit of US$1.66 billion, with oil products being the main contributor. From January to August 2025, the total import value reached US$155.99 billion, a 2.05% increase compared to the same period last year. Oil and gas imports were recorded at US$21.11 billion, down 12.82%. Non-oil and gas imports were recorded at US$134.88 billion, up 4.85%.

Capital goods imports reached US$31.32 billion, up 17.94% compared to the same period last year, contributing 3.12% to the increase. Imports of capital goods that saw significant increases included electrical machinery and equipment, ships and floating structures, and aircraft and parts. Meanwhile, imports of auxiliary raw materials fell 1.09% to US$110.57 billion. Similarly, imports of consumer goods decreased 2.85% to US$14.09 billion. When viewed by import destination country and region, imports increased from China, Japan, and the US. Meanwhile, imports from ASEAN and the European Union decreased.

In August 2025, the total import value reached US$19.47 billion, a 6.56% decrease compared to August 2024. Oil and gas imports reached US$2.73 billion, a 3.17% year-on-year increase. Meanwhile, non-oil and gas imports reached US$16.74 billion, a 7.98% decrease. The annual decline in import value was driven by a decrease in non-oil and gas imports, contributing 6.97% to the decrease. The Central Statistics Agency (BPS) recorded that the total export value from January to August 2025 reached US$185.13 billion, a 7.72% increase compared to the same period last year.

M. Habibullah, Deputy for Production Statistics at BPS, noted that oil and gas exports reached US$9.04 billion, a 14.14% decrease. Non-oil and gas exports increased by 9.15% to US$176.09 billion.

“When viewed by sector, the cumulative increase in non-oil and gas exports occurred in the processing and agricultural sectors,” he said in a BRS release on Wednesday (October 1, 2025).

He stated that the processing sector was the main driver of the increase in non-oil and gas export performance from January to August 2025, contributing 12.26%. Exports from the processing sector that saw significant increases included palm oil, non-ferrous base metals, organic basic chemicals sourced from agricultural products, jewelry and valuables, and semiconductors and other electronic components.

“When viewed by country and main export destination region, the value of non-oil and gas exports to China was recorded at US$40.44 billion, an 8.68% increase compared to the same period last year,” he explained. Compared cumulatively, non-oil and gas exports to the US, ASEAN, and the European Union increased, while those to India decreased.

September 25, 2025, CNBC Indonesia

(https://finance.detik.com/berita-ekonomi-bisnis/d-8139142/top-neraca-dagang-ri-surplus-64-bulan-beruntun)

(https://finance.detik.com/berita-ekonomi-bisnis/d-8139125/impor-ri-januari-agustus-tembus-us-155-99-miliar-naik-2-05)

(https://finance.detik.com/berita-ekonomi-bisnis/d-8139114/bps-catat-ekspor-ri-hingga-agustus-tembus-us-185-13-miliar)

President Prabowo Subianto witnessed the signing of the Indonesia-Canada Comprehensive Economic Partnership Agreement (ICA-CEPA) after a face-to-face meeting with Canadian Prime Minister Mark Carney at the West Block of Parliament Hill, Ottawa, on Wednesday (September 24, 2025). The signing was carried out by Trade Minister Budi Santoso and Canadian International Trade Minister Maninder Sidhu. During the meeting, it was stated that the agreement would address trade barriers between the two countries.

“This is the first bilateral trade agreement with an ASEAN country,” said Mark Carney in his remarks.

He also ensured that the agreement, which will be implemented in 2026, will be a game-changer for trade between Indonesia and Canada.

“This will be a game-changer. When fully implemented, it will mean that 95% of trade tariffs from Canada to Indonesia will be reduced or eliminated,” said Carney.

According to Carney, all trade will be offered at preferential tariffs or lower import duties, thus making his country’s exports more competitive.

“It will clearly make our exports much more competitive and give Canadian workers and businesses greater access to a market of over 300 million people, with a GDP of $2 trillion, which will grow rapidly thanks to your policies,” said Mark Carney.

Everything will be offered at preferential tariffs, which will clearly make our exports much more competitive and give Canadian workers and businesses greater access to a market of over 300 million people, with a GDP of $2 trillion, which will grow rapidly thanks to your policies.

On the other hand, President Prabowo appreciated the importance of the ICA-CEPA as a strategic economic and political partnership between the two countries. Furthermore, this agreement will be a historic moment. In fact, Prabowo even joked during the process of drafting this cooperation agreement. According to information gathered, the implementation of the ICA-CEPA is projected to increase Indonesian exports to Canada to US$11.8 billion by 2030. It will also increase GDP growth by 0.12%. This agreement will strengthen defense cooperation between the two countries. This includes Canada’s participation in Super Garuda Shield, regular defense dialogues, and long-term support for strengthening cooperation between the two countries’ military industries. Prabowo explained that Indonesia will send students to train in the defense sector. “We want to send more of our young people to study here, to be trained here, and to collaborate in the defense sector in the future,” Prabowo said in his remarks.

From a business perspective, this includes business-to-business (B2B) cooperation between Indonesian and Canadian entrepreneurs. The signing of this agreement was carried out by the Chairman of the Indonesian Chamber of Commerce and Industry (Kadin), Anindya Bakrie, along with representatives from the Canadian Chamber of Commerce and Industry (BCC).

“We welcome the signing of the agreement with the Canadian Council on Foreign Relations, which is part of this effort to strengthen ties between businesses in both countries,” said Mark Carney. “We are also preparing a trade mission as part of this agreement, and this will strengthen our trade relationship.”

In addition to economic benefits, the ICA-CEPA also provides greater legal certainty for businesses, including regulatory transparency, investment protection, and a commitment to empowering MSMEs, digital marketplaces, intellectual property rights, and sustainable trade.

September 25, 2025, CNBC Indonesia

(https://www.cnbcindonesia.com/news/20250925070518-4-669989/sah-ica-cepa-diteken-95-hambatan-dagang-ri-kanada-lenyap) (https://www.cnbcindonesia.com/news/20250925112448-4-670076/top-7-jam-di-kanada-prabowo-bawa-oleh-oleh-rp-197-t)

The Indonesia Investment Authority (INA) has signed a memorandum of understanding (MoU) worth CAD 825 million (US$594 million) with Canada’s export credit agency, Export Development Canada (EDC), to bolster bilateral investment opportunities. Under the agreement, EDC will allocate financing for Indonesia’s sovereign wealth fund, particularly for projects in priority sectors such as infrastructure, clean technology, renewable energy, agriculture, and food. The MoU outlines financing solutions and joint opportunities within an Indonesia–Canada nexus across these priority sectors, leveraging EDC’s global financing capabilities and INA’s deep local insight.

Ridha Wirakusumah, CEO of INA, said the partnership reflects the shared commitment of both institutions “to build a mutually beneficial platform between Canada and Indonesia.” The collaboration is expected to strengthen INA’s role in channeling investment into sectors critical to Indonesia’s long-term competitiveness, Ridha added. “Beyond financing, the collaboration is about structuring credible opportunities that attract global capital, bring innovation, and deliver tangible socioeconomic impact. In doing so, we aim to deepen trust and create lasting opportunities that drive shared prosperity for both countries,” she stated in a press release on Thursday.

Todd Winterhalt, Senior Vice President of International Markets at EDC, highlighted that Indonesia is one of the fastest-growing economies in the Indo-Pacific region and has become a major investment destination for Canadian exporters. “Our partnership with INA reflects EDC’s dedication to fostering robust socioeconomic growth in the country and the region. This collaboration aims to significantly enhance trade between our nations, especially in sectors where Canadian companies excel,” Todd said, as quoted in the same press release.

On Thursday, President Prabowo Subianto and Canadian Prime Minister Mark Carney signed the Canada–Indonesia Comprehensive Economic Partnership Agreement (CEPA), marking Canada’s first bilateral trade agreement with an ASEAN country. The agreement, which will eliminate or reduce tariff and non-tariff barriers between the two nations, is set to take effect next year. In 2024, Indonesia was Canada’s largest export market and a major investment destination in Southeast Asia. In September 2023, EDC opened its Jakarta office to tap into the country’s “significant opportunities” for Canadian exporters and investors.

Meanwhile, INA was established in 2020 to attract foreign investors to domestic projects, with an initial capital of IDR 75 trillion (US$4.5 billion), and currently manages assets of around IDR 160 trillion. In July, the sovereign wealth fund reported capital deployment totaling IDR 4.5 trillion during the first five months of this year, together with its partners, increasing its overall disbursement from IDR 60.9 trillion in December 2024 to IDR 65.4 trillion as of May 2025. By the end of last year, INA had channeled IDR 24.9 trillion in cumulative capital, along with IDR 36 trillion from co-investors, across four national priority sectors: transport and logistics, green energy and transformation, digital infrastructure, and health care.

In 2024, INA secured IDR 8.2 trillion in investment from the United Arab Emirates’ Abu Dhabi Investment Authority (ADIA) and APG Asset Management for the Medan–Binjai and Bakauheni–Terbanggi Besar sections of the Trans-Sumatra Toll Road. INA has also partnered with state asset fund Danantara in a deal with French miner Eramet to invest strategically in the nickel supply chain, as well as in the factory expansion of Chandra Asri Group, a publicly listed petrochemical giant.

September 25, 2025, The Jakarta Post

(https://www.thejakartapost.com/business/2025/09/25/ina-seals-594m-financing-deal-with-canadas-state-lender.html)

Prof. Hamdan Hamedan, Senior Expert at the Government Communications Agency (Bakom RI), assessed President Prabowo Subianto’s speech at the 80th United Nations (UN) General Assembly as significant, emphasizing not only Indonesia’s commitment to world peace but also its strategic role in ensuring global economic stability.

“Indonesia demonstrates a strong commitment to world peace through its active position in advancing internationalism and multilateralism,” Hamdan said in a written statement on Wednesday (September 24, 2025).

As a country that supports strengthening global institutions, Indonesia highlights the importance of collaboration to address interconnected challenges—conflict, climate change, and food insecurity—that directly influence global markets and economic growth. Prabowo’s address outlined Indonesia’s integrated vision: maintaining peace, achieving food sovereignty, and supporting sustainable economic development. Indonesia’s success in national food self-sufficiency becomes a foundation for global cooperation, enabling the nation to assist others—such as Palestine—through rice aid, while reinforcing supply stability and humanitarian diplomacy.

“This reflects Indonesia’s role as a nation with food sovereignty that contributes to global food security and economic resilience,” Hamdan continued.

Prabowo also emphasized Indonesia’s determination to mitigate climate change as part of its global responsibility—through the 2015 Paris Agreement, a net-zero target by 2060, and massive reforestation programs. These initiatives strengthen long-term economic stability by reducing environmental risks that threaten food production and energy resources. Indonesia’s consistent support for the two-state solution in the Palestine-Israel conflict is also part of its peace-driven economic diplomacy. By promoting justice and humanitarian assistance, Indonesia positions itself as a bridge between regions, supporting both political stability and trade cooperation.

At the 80th UN General Assembly in New York (September 23, 2025), President Prabowo became the third speaker, after Brazilian President Luiz Inácio Lula da Silva and U.S. President Donald Trump. His speech was a key moment to affirm Indonesia’s strategic role in addressing global economic challenges, from security and energy to climate and trade.

Prabowo stressed that conflicts and inequality disrupt not only peace but also supply chains and economic equity. He called on the UN Security Council to actively safeguard global stability. Drawing on Indonesia’s historical experience, he stated that justice and equality are prerequisites for prosperity, while oppression leads to poverty. He reaffirmed confidence in multilateralism as a mechanism for fair economic cooperation and expressed readiness to send 20,000 peacekeepers to conflict zones—an investment in peace that supports regional market stability. He also offered Indonesia’s resources and technology to help solve food and environmental crises—linking peace with productivity and sustainable development.

By deconstructing Thucydides’ doctrine of power and Huntington’s clash of civilizations, Prabowo positioned Indonesia’s diplomacy on moral and cooperative economics—where justice, technology, and cultural understanding serve as the foundation of a stable global economy. This speech continues Indonesia’s tradition of peace-based diplomacy—from Sukarno’s 1960 call for a just world to SBY’s 2008 warning on financial crises—affirming that Indonesia’s vision of peace is inseparable from global economic resilience and shared prosperity.

September 24, 2025, detikNews

(https://news.detik.com/berita/d-8128218/pidato-prabowo-di-pbb-tegaskan-komitmen-indonesia-pada-perdamaian-dunia) (https://news.detik.com/kolom/d-8134771/pidato-prabowo-di-pbb-kemerdekaan-palestina-dan-pesan-perdamaian)

Indonesia and the European Union (EU) will sign the Indonesia-EU Comprehensive Economic Partnership (IEU-CEPA) trade agreement on Tuesday, September 23, 2025. This marks a government success after nearly a decade of intense negotiations. The agreement is a new strategy for both parties to mitigate the impact of U.S. President Donald Trump’s tariff policies. The agreement, to be signed in Bali, brings Indonesia and the 27-member bloc into a broader economic relationship. It’s worth noting that the IEU-CEPA is the third trade agreement signed by the EU with Southeast Asian countries, after Singapore and Vietnam. Here are five things to know:

Urgency: Indonesia has been in talks with the EU since 2016. But negotiations for a trade deal initially showed little progress. However, in July, President Prabowo Subianto traveled to Brussels and announced with EU President Ursula von der Leyen that the two sides had reached a “political agreement” to finalize the deal after 19 rounds of negotiations. Indonesia’s Coordinating Minister for Economic Affairs, Airlangga Hartarto, said the uncertainty caused by “tariff wars and protectionism” between major economies is driving both sides “to seek certainty through stable bilateral agreements.”

“This agreement is expected to mitigate the risks from the impact of a global tariff war,” Airlangga said.

Tariffs Eliminated: Approximately 80% of Indonesia’s exports to the EU will be tariff-free once the agreement comes into force. This is expected to benefit Indonesia’s main exports to the bloc, including palm oil, footwear, textiles, and fisheries. Von der Leyen said in July that the agreement would open new markets. It would also help strengthen Europe’s supply chains of critical raw materials to support the clean and digital transition.

“We don’t just want secure supply, but we want responsible supply,” she said.

“That means respect for the environment, respect for local communities, and a clear focus on good jobs and the creation of local added value.”

Benefits: The EU is Indonesia’s fifth-largest trading partner, with bilateral trade reaching US$30.1 billion (IDR 500 trillion) last year. The agreement will further open the EU’s access to the Indonesian market, which has a population of around 280 million.

“With the CEPA, it will be easier for them (the EU) to enter Indonesia,” said Deni Friawan, a researcher at the Center for Strategic and International Studies (CSIS), emphasizing the size of the market and its economic growth, as reported by AFP.

Green Policy: It should be noted that relations between Indonesia and the EU have been tense. Several issues have caused tension, such as the EU’s proposed import ban on products linked to deforestation, which has angered Indonesia, a major palm oil exporter. Under EU deforestation regulations, exports of a wide range of goods — including soybeans, timber, palm oil, livestock, printing paper, and rubber — are banned if produced on land deforested after December 2020.

EU Trade Chief Maros Sefcovic has promised to provide “preferential treatment” regarding deforestation regulations for countries that have signed a trade agreement with the bloc. The EU has delayed the implementation of the rules until later this year after facing resistance. Brussels is reportedly pushing to include provisions on deforestation in the agreement, but details have not been made public.

Next Steps: After signing the agreement, both sides are expected to implement steps, including legal checks and translations of official documents. The agreement must then be ratified by EU members, the European Parliament, and the Indonesian parliament, and is expected to be implemented by 2027.

September 22, 2025, CNBC Indonesia

(https://www.cnbcindonesia.com/news/20250922134736-4-669093/top-prabowo-perjanjian-dagang-ieu-cepa-tanda-tangan-besok-di-bali)

PT Pertamina Geothermal Energy (PGE), a publicly listed subsidiary of state-owned Pertamina, has commenced construction of a green hydrogen project in Ulubelu, Lampung. With an investment of US$3 million, the pilot facility is designed to produce up to 100 kilograms of green hydrogen per day, operating at an efficiency rate of 82 to 88 percent. The project is expected to begin operations in 2025. Notably, the facility will be the first to integrate Anion Exchange Membrane (AEM) electrolyzer technology with geothermal energy as a clean power source.

As a carbon-free fuel in both production and use, green hydrogen is regarded as a key solution for decarbonizing industries that are challenging to electrify, such as steel, cement, and transportation. PGE President Director Julfi Hadi emphasized that the project represents an important milestone in placing Indonesia within the global clean energy supply chain. He noted that Ulubelu could serve as a replicable innovation hub for other geothermal areas and outlined PGE’s broader strategy of utilizing green hydrogen as feedstock for derivatives such as green ammonia and methanol. These products are projected to become vital fuels and raw materials for future low-carbon industries. Pertamina Corporate Communications Vice President Fadjar Djoko Santoso further highlighted that the initiative contributes directly to Indonesia’s 2060 net-zero emissions target.

The Indonesian government views hydrogen as central to its decarbonization agenda. As Southeast Asia’s largest economy, the country seeks to reduce reliance on fossil fuels, strengthen energy security, and establish itself as a hydrogen export hub. Hydrogen functions as an energy carrier, storing and transporting energy from other sources, and can be used in fuel cells to generate electricity and heat. These attributes make it a promising option for low-carbon energy solutions. According to Goldman Sachs, the green hydrogen market could eventually reach a global value of US$12 trillion, attracting significant investment. Similarly, the International Energy Agency (IEA) projects that hydrogen development will create substantial employment opportunities while enhancing energy resilience.

In the domestic context, green hydrogen has the potential to replace natural gas and coal, while also serving as a future export commodity. To accelerate its adoption, Indonesia released the National Hydrogen Strategy (SHN) in December 2023, outlining policies to promote hydrogen production and consumption. In April 2024, the government followed with the National Hydrogen and Ammonia Roadmap (RHAN), which sets out detailed plans and action steps for scaling hydrogen and ammonia development nationwide.

However, challenges remain, particularly regarding production costs. Fabby Tumiwa, Executive Director of the Institute for Essential Services Reform (IESR), observed that green hydrogen currently costs between US$6 and US$10 per kilogram, three to four times higher than hydrogen derived from natural gas. The elevated costs stem from expensive electrolyzer technology, renewable electricity prices, and the limited scale of renewable energy infrastructure. Despite these constraints, Fabby expressed optimism that the sector will become more viable as renewable energy capacity expands, lowering production costs over time.

In sum, PGE’s green hydrogen pilot project represents both a technological breakthrough and a strategic step in Indonesia’s energy transition. By leveraging geothermal resources and advanced electrolysis, the initiative underscores the nation’s ambition to decarbonize its economy, strengthen energy security, and capture opportunities in the emerging global hydrogen market.

September 10, 2025, The Jakarta Post

(https://www.thejakartapost.com/business/2025/09/10/pertamina-breaks-ground-on-3m-green-hydrogen-project.html)

The Indonesian government has announced the establishment of six new special economic zones (SEZs) targeting a range of industries, including halal products and electric vehicles (EVs). According to Susiwijono “Susi” Moegiarso, Secretary to the Coordinating Economic Minister, the zones are awaiting the issuance of government regulations before becoming operational. Among them, the Sidoarjo SEZ in East Java is set to specialize in halal products, aiming to integrate Indonesia into global halal supply chains. Another SEZ, located in Subang, West Java, will focus on strengthening Indonesia’s EV ecosystem, with interest from Chinese manufacturers such as BYD. Details on the remaining four SEZs will be disclosed once the relevant regulations are enacted.

As of June 30, Indonesia operates 25 SEZs across industries including manufacturing, digital technology, tourism, wellness, and maintenance, repair, and overhaul (MRO) services. These SEZs span 23,798 hectares nationwide, with seven on Java and 18 outside the island. Collectively, they attracted IDR 40.48 trillion (US$2.46 billion) in realized investment in the first half of 2024, accounting for 48.2 percent of the annual target and representing a 29 percent year-on-year increase. The zones also generated employment for 28,094 people.

Susi emphasized that developing SEZs is aligned with national priorities to advance downstream industries, enhance the value of domestic natural resources, expand exports, and reduce reliance on imports. A prominent example is the Gresik SEZ in East Java, home to PT Freeport Indonesia’s smelter, described as the world’s largest, which will strengthen the national copper industry while supporting gold production of 52 tonnes annually.

Other SEZs highlight Indonesia’s efforts to position itself in global supply chains. The Sei Mangkei SEZ in North Sumatra has become a key hub for downstream palm oil, with exports valued at IDR 2.7 trillion in 2024. The zone is also expected to attract an additional US$20 million in investment from PT Unilever Oleochemical Indonesia for expansion. In Central Java, the Kendal SEZ is contributing to the global EV supply chain through exports of battery anodes to the United States. Its battery plant has an annual capacity of 80,000 tonnes, enough to support production for approximately 1.5 million EVs.

Meanwhile, the Nongsa SEZ in Batam, Riau Islands, is bolstering Indonesia’s digital economy by securing IDR 5.8 trillion in investment from leading global data center operators, including China’s GDS, Hong Kong’s Gaw Capital, Singapore’s Princeton Digital Group, and New Zealand’s BWDigital Infra Indonesia. In addition, the Galang Batang SEZ in Bintan, also in the Riau Islands, currently exports 2 million tonnes of smelter-grade alumina annually and plans to double capacity to 4 million tonnes per year.

Overall, the planned new SEZs reflect Indonesia’s strategy to deepen industrial downstreaming, attract foreign investment, and enhance its participation in global value chains. By combining diverse focuses—ranging from halal products and EVs to palm oil, digital infrastructure, and mineral processing—the government seeks to ensure sustainable growth, job creation, and stronger economic resilience.

September 10, 2025, The Jakarta Post

(https://www.thejakartapost.com/business/2025/09/10/new-economic-zones-to-invite-ev-firms-halal-products-industry.html)