Across the sea, China and Indonesia share a thick heritage of friendship. This year marks the 10th anniversary of President Xi Jinping’s initial proposal of the 21st-Century Maritime Silk Road in Indonesia in 2013, as well as the Comprehensive Strategic Partnership between the two nations. With the impetus of the BRI, the cooperation between China and Indonesia has gradually and steadily entered an all-sided and full-scale status. Looking ahead, the friendship and collaborative path between the two sides will surely be wider and brighter.

Author: Djauhari Oratmangun

Ambassador of the Republic of Indonesia to China

Indonesia-China Bilateral Relations & Trade and Investment Cooperation

This year, Indonesia and China celebrate a decade of launch of the Belt and Road Initiative, as well as the establishment of Indonesia-China Comprehensive Strategic Partnership. This is the highest level of bilateral relations.

I did remember that in 2013, President Xi Jinping, during his visit to Indonesia, delivered his very important speech at the parliament of Indonesia. He introduced the 21st-Century Maritime Silk Road. This Road later became an integral part of the Belt and Road Initiative, as “belt” refers to the Silk Road Economic Belt that connects China and Europe, while “road” is for the 21st-Century Maritime Silk Road that connects China and Southeast Asia, and then of course in particular, my country, Indonesia. It also signifies the importance of Indonesia in the Belt and Road cooperation.

During the visit of my President Joko Widodo’s participation on the first Belt and Road Forum for International Cooperation in Beijing back in 2017, he proposed to synergize China’s Belt and Road Initiative (BRI) with Indonesia’s Global Maritime Fulcrum (GMF). Therefore, I am very happy to share with you today about the development of Indonesia and China’s bilateral relations, of course including Hong Kong, and the progress and future prospects of our cooperation, under the synergy between China's Belt and Road Initiative and Indonesia’s Global Maritime Fulcrum.

As I mentioned before, Indonesia and China’s Comprehensive Strategic Partnership has also entered its 10th anniversary. I have frequently mentioned in many forums that our status as comprehensive strategic partners should be fully reflected in data. Indeed, I am very delighted to see the progress in the trade and investment relations between the two nations over the past several years. For example in 2022, according to China’s customs data, the trade volume between Indonesia and China already reached almost 150 billion USD, to be exact—149.2 billion USD, or say increased by more than 20% compared with 2021. As for the trade volume between Indonesia and Hong Kong in 2022, it is accounted around 5.72 billion USD. While for the first quarter of 2023, the trade volume between Indonesia and China has reached 36.3 billion USD, increased by 10.7% on a year-on-year basis; the trade volume between Indonesia and Hong Kong has reached 1.2 billion USD. Talking about investment relations, in 2022, China has ranked as the second largest investor in Indonesia with the realization of investment value at 8.2 billion USD, increased by 156.25% on a year-on-year basis; while Hong Kong is the third largest investor in Indonesia with the realization of investment value at 5.5 billion USD, increased by almost 20%. Adding up the data of China and Hong Kong, it already becomes the largest investor in Indonesia. For the first quarter in 2023, HKSAR was the top investor in Indonesia and China was the second one. I am confident that this positive trend will continue through the end of this year. Momentum of economic recovery is showing results particularly in China and HKSAR, which will further influence the trade and investment cooperation among Indonesia, Hong Kong and China.

An Effective Synergy: Indonesia’s GMF and China’s BRI

Let me say a few words about GMF and BRI. Since President Joko Widodo promoted the synergy of two important initiatives proposed by two great leaders in 2018, the two countries have formally agreed on the synergy of GMF and BRI. It was indeed very relevant and opened up a new direction for the bilateral cooperation of both countries.

Fast forward to 2023, the synergy has turned to one of the strongest pillars of the bilateral partnership between Indonesia and China. Under the synergy, both countries have successfully launched several notable projects, including the establishment of Regional Comprehensive Economic Corridors, or we call it RCEC in four provinces in Indonesia: North Sumatra as a hub for ASEAN’s Economic and Commercial Center, North Kalimantan as a hub for the renewable energy center, Bali as a hub for information, communication and innovation technology, North Sulawesi as a hub for the Pacific Rim Economic Center, plus Jakarta-Bandung High-Speed Railway, “two countries - twin parks”, “Green Industrial Park” in North Kalimantan, and Kura Kura Bali Island Science Park, etc.. The synergy has greatly boosted the advanced development of the relevant regions.

The important thing as well is the people-to-people connectivity, because I do believe that if we have a strong tie in people-to-people relation, it will contribute further to the two pillars of the cooperation—political security and economic development, and of course many more benefits. Furthermore, to ensure the mutual and shared benefits of the synergy, the government has also put forward the “5+3” approach, as the main principle for the GMF and BRI cooperation.

These “5” approaches are high-environmental standard, integrated development approach, the usage of Indonesian labor, technological transfer, and international best practices. While the “+3” principles are business-to-business, market orientation, and government support when needed. We believe that by adding the “5+3” approach, we will be able to attract sustainable and high-quality investment in Indonesia's pilot sectors.

Moving forward to future cooperation, the synergy of Global Maritime Fulcrum and Belt and Road Initiative should be further expanded, not just in terms of hard connectivity and infrastructure development, but also in other cooperation such as the development of soft infrastructure, people-to-people exchanges, digital economy, health infrastructures (lesson learned from COVID-19), new energy, and sustainable development.

Moreover, the cooperation should be based on an equal, open, transparent and inclusive partnership by expanding cooperative partnerships, network, and platform to support the synergy of GMF and BRI, including collaborations with Hong Kong, the Greater Bay Area and some targeted regions in Indonesia.

Moving Forward: the Thiriving Indonesia-China Cooperation

This year, Indonesia is the chairman of ASEAN. In 2021, ASEAN and China celebrated the 30th anniversary of ASEAN-China Dialogue Relations. During the Special Summit in November 2021, we elevated as well the relation between ASEAN and China to Comprehensive Strategic Partnerships. Since then, both China and ASEAN have become the largest trading partners of each other. Last year, the trade volume between ASEAN and China almost reached one trillion USD, to be exact—968 billion USD. If we added the trade volume between ASEAN and Hong Kong, the amount already surpassed one trillion USD. We are looking forward to a better relationship among ASEAN, China, and Hong Kong. Since this year, we have implemented the Regional Comprehensive Economic Partnership (RCEP), in which fifteen members are included: ten members of ASEAN and the five partners who have the Free Trade Agreements (FTA) with ASEAN, including China, Japan, Korea, Australia, and New Zealand. By adding on the BRI, I think that a lot of things can be done in the very near future.

To conclude my remarks, I would like to emphasize that successful synergy of GMF and BRI with its flagship projects carries an important methods—how the strategic national visions can become a foundation of strong and complementary bilateral relations. This should be carried on to future cooperation by further promoting mutually beneficial and high-quality projects between us. Last but not least, I wish this forum would offer fruitful discussions and concrete take-ways for all of us. Hand in hand, we have been forging ahead for ten years. I firmly believe that Indonesia and China have great potentials and room for future cooperation that strengthens our bilateral relations.

(The article has been edited)