Indonesia, Turkey ink investment cooperation agreement worth US$250 million

Jakarta (ANTARA News) – Indonesia and Turkey have inked a cooperation agreement on investment worth US$250 million (Rp6.7 trillion) during the visit of President Joko Widodo to Ankara, Turkey, this week.

Head of the Capital Investment Coordinating Board (BKPM) Thomas Lembong noted in a written statement here on Friday that the cooperation was contained in two memoranda of understanding (MoUs).

One MoU pertains to cooperation worth $320 million between Indonesias state-owned shipbuilding company PT PAL and Turkish electricity energy and powership firm Karadeniz Holding.

The other MoU covers cooperation between Indonesias state-owned aircraft maker PT Dirgantara Indonesia and the Turkish Aerospace Industry, with an agreement worth $200 million.

“The agreement covers the production of four powerships, with an electricity generation capacity of 36-80 megawatts (MW),” Lembong revealed.

Lembong said the cooperation to build powerships is in line with the Indonesian governments commitment to meeting the electricity needs of its people in isolated areas and to achieve the countrys target of developing power plants having a cumulative capacity of 35 thousand MW.

“The opportunity to invest in the production of powerships is huge. Hence, we will continue to monitor the commitment made by the two firms,” the BKPM chief remarked.

He said the cooperation between PT PAL and Karadeniz Holding is expected to fill the gap for regional electricity supply vessels.

“Neighboring countries, such as the Philippines and Myanmar, are potential customers for the company,” he pointed out.

Meanwhile, the agreement between PT Dirgantara Indonesia and the Turkish Aerospace Industry covers three main points.

The agreements include cooperation in the fields of marketing and production extension of N219 and UAV-ANKA as well as the joint development and production of N245, particularly to expand reach in the Southeast Asian market, including Indonesia.

During the presidents work visit to Turkey, two types of agreements were signed: government partnership in health and economy and business cooperation.

Trade Minister Enggartiasto Lukita signed the Indonesia-Turkey Comprehensive Economic Partnership Agreement with the Turkish government. In addition to the trade minister, Foreign Minister Retno Marsudi represented the government in signing the health partnership agreement.

Business agreements between Indonesian and Turkish companies were represented by three state-owned Indonesian firms and three Turkish companies.

Investment cooperation between Indonesian and Turkish companies is expected to increase the value of Turkeys investment realization, which is still small in Indonesia.

Based on BKPMs data for the first quarter of 2017, the realization of Turkish investment was only $0.1 million, spread across nine projects. The value indicates that no new investment was made by Turkey during that period.

Source: Antara News