Rosan Perkasa Roeslani, chairman of the Indonesian Chamber of Commerce and Industry (Kadin), center left, shakes hands with Ghassan Ahmed al-Sulaiman, Governor of the General Authority for Small and Medium-Sized Enterprises for Saudi Arabia, in Jakarta on Thursday (03/02). (BeritaSatu Photo/Uthan A Rachim)

Saudi Businesses Invest $2.4b in Indonesia During King Salman's Visit


MARCH 03, 2017

Jakarta. Indonesian and Saudi Arabian companies finalized four investment agreements totaling $2.4 billion during a meeting between delegates from the Saudi Chambers of Commerce and Industry and its Indonesian counterpart in Jakarta on Thursday (02/03).

Rosan Perkasa Roeslani, chairman of the Indonesian Chamber of Commerce and Industry (Kadin) said that King Salman bin Abdul Aziz al-Saud's visit to Indonesia this week has reinvigorated Saudi investments across the archipelago.

"The king's visit to Indonesia has spurred investment here," Rosan said. "Saudi businessmen readily admit that they seriously considered investing in Indonesia before King Salman's visit. This momentum must be seized, because the memorandum of understanding will amount to nothing if we do not follow through on this progress."

The state-owned construction company Wijaya Karya signed a memorandum of understanding with the Saudi Adil Abdul Munif Makki Group, which will see the two companies develop a housing project in the Gulf kingdom in the coming years, Rosan noted.

He said that the project will include the construction of 8,000 housing complexes and is estimated to cost $2 billion.

Saudi's Alfanar Energy has also agreed to invest in a biomass power plant in Indonesia, valued at approximately $100 million. The company will work with Koperasi Produsen Anugerah Bumi Hijau, a local farmers cooperative, in developing the power plant.

In the medical services sector, Healthcare Bundamedik System, an Indonesian hospital operator, signed an agreement with the Saudi Aloula Medical Care organization to initiate mutual cooperation in the field, Rosan said. Details of that cooperation have yet to be released to the public.

Kadin and the Saudi Chambers of Commerce have also agreed to explore further cooperation in the country's tourism industry, with the Saudi chamber planning to bolster investment into local travel agents specializing in facilitating hajj and umrah pilgrimages for the nation's 202 million Muslims, Rosan said.

Both chambers have also agreed to establish what will be known as the Indonesia Saudi Arabia Business Council, which will aim to promote investment projects between the two countries in sharia financing and infrastructure projects.

In previous years, Saudi Arabia has shown meager interest in investing in the country, with last year's total investments from the Gulf kingdom amounting to only $900,000.

Saudi investment between 2010 to 2015 totaled only $34 million, or 0.02 percent of total foreign direct investment in that period.