Jakarta. President-elect Prabowo Subianto met with Saudi Arabia’s Crown Prince Mohammed bin Salman -- known by his initials MBS -- in Jeddah on Wednesday local time, and the latter is seeking greater investment cooperation. 

The bilateral meeting mainly focused on the situation in Gaza. However, talks of trade and investment ties emerged -- something that is quite timely as data has shown that Saudi’s investment in Indonesia remained lackluster despite their close ties. According to a press statement issued by the Indonesian Defense Ministry, Crown Prince MBS reportedly told Prabowo that Indonesia had become a “second home” to Saudi Arabia.

“The crown prince highlights the need to ramp up economic and investment cooperation with Indonesia,” the press statement reads.

Likewise, Prabowo --who is also the defense minister-- wants to see greater trade volume between Indonesia and Saudi Arabia. He even named the defense equipment as a potential trade booster.

“Prabowo pushes for both countries to continue to work together to boost trade by exploring new opportunities. This includes exploring the potential for trade related to the defense industry, agricultural technology, halal industry, and creative industry,” the press statement also reads.

Saudi Arabia earlier this year granted Indonesia an additional hajj quota of 20,000 people. This enables the Southeast Asian country to send a total of 241,000 hajj pilgrims to the holy city of Mecca. While the hajj-related cooperation is often hailed as a testament to Indonesia-Saudi Arabia's strong ties, their economic relations say otherwise. 

Indonesia reported that it only attracted $600,000 in foreign direct investment (FDI) from Saudi Arabia in the first quarter of 2024. This puts Saudi Arabia in 73rd place in Indonesia’s FDI source rankings.

The lack of Middle Eastern investments has also previously concerned the Indonesian government. Earlier this year, Pradana Indraputra, a special advisor at the Investment Ministry, highlighted that there had not been many Middle Eastern investors in the country despite the region’s robust financial power. According to Pradana, Middle Eastern investors usually favor brownfield investments. In other words, they prefer acquiring existing companies rather than starting from scratch.

Indonesia-Saudi Arabia trade had dropped from $7.5 billion in 2022 to $6.1 billion the following year. Indonesia also suffered a deficit of almost $2 billion when trading with Saudi Arabia in 2023, according to the Trade Ministry.

Throughout 2023, Indonesian exported goods mainly went to China which made up 25.7 percent of the export destination share. Followed by the US (9.57 percent) and India (8.35 percent).