President Prabowo Subianto witnessed the signing of $22.6 billion in investment agreements with Japan, positioning Indonesia to compete with Vietnam for post-China manufacturing dominance - if the pledged capital actually materializes.
The package encompasses 10 memorandums of understanding signed at the Japan-Indonesia Business Forum in Tokyo on March 30, spanning energy, semiconductors, and green technology. Cabinet Secretary Teddy Indra Wijaya characterized it as "a strong symbol of commitment from Indonesia and Japan's business sectors to expand concrete collaboration."
The flagship project involves developing the Gas Field Abadi in the Masela Block, a long-delayed natural gas development that has consumed decades of planning. PT Pertamina and Japanese energy major INPEX will partner on the project, which promises substantial liquefied natural gas exports if infrastructure challenges can be overcome.
Semiconductor manufacturing represents Indonesia's most ambitious industrial leap. PT Eblo Teknologi Indonesia and Hayashi Kinzoku Co. signed an agreement covering "chip electronics design and manufacturing plus artificial intelligence" - sectors where Indonesia currently possesses minimal expertise but enormous aspirations.
Other agreements include methanol production using CO2 emissions from fertilizer facilities in Bontang, East Kalimantan, the Rajabasa geothermal power plant, and various upstream oil and gas partnerships.
The deals reflect Prabowo's shift from his predecessor Joko Widodo's infrastructure obsession toward industrial partnerships. Where Jokowi built roads and ports, Prabowo seeks factories and refineries - the hilirisasi (downstream development) strategy aimed at processing Indonesia's resources domestically rather than exporting raw materials.
