Jakarta. Six South Korean companies, ranging from a cable manufacturer to a venture capital firm, have made commitments to invest a total of $446 million in Indonesia, Industry Minister Airlangga Hartarto said on Tuesday (11/09).
The investment deals resulted from the 2018 Indonesia-Korea Business and Investment Forum, which took place in Seoul last week to coincide with 45th commemoration of diplomatic relations between Indonesia and South Korea.
"This meeting reflects the great enthusiasm of South Korean businessmen to further business collaboration with Indonesia, either in terms of business expansion, or new investments in several prospective industrial sectors," Airlangga said in a statement.
Among the deals is a partnership between South Korea's LS Cable & System and Artha Metal Sinergi, part of tycoon Tommy Winata's Artha Graha Group, to develop $50 million power cable manufacturing facility in Karawang, West Java.
Busan-based Parkland will invest $75 million in a new footwear plant in Pati, Central Java, while Gangnam-based clothing firm Sae-A Trading will invest $36 million in a textile and garment plant in Tegal, also in Central Java.
South Korean chemical and textile firm Taekwang Industrial will expand its business interests in Indonesia with a new, $100-million footwear manufacturing facility in Subang and Bandung, both in West Java.
World Power Tech, in cooperation with its local partner, NW Industries, is set to invest $85 million in the development of turbine and boiler manufacturing industries in Bekasi, West Java,
Lastly, Seoul-based venture capital firm InterVest and Jakarta-based early-stage investment firm Kejora Ventures have established a $100 million fund to provide growth-stage startups with capital.
Airlangga believes the cooperation will boost the national manufacturing industry, add value to domestic raw materials and create jobs for local workers. "This can spur inclusive economic growth," he said.
The minister also expects technology transfers from the South Korean partners to help Indonesia modernize its manufacturing industry.
South Korean companies invested a total of $2 billion in Indonesia last year, making it the archipelago's sixth-largest foreign investor, accounting for 6.3 percent of total foreign direct investment, according to Investment Coordinating Board (BKPM) data.