Continue to Grow, South Korea Becomes a Strategic Partner for Indonesia

INDUSTRY.co.id - Jakarta, South Korea (South Korea) has become a partner that is progressively developing and expanding its scope in Indonesia.

Special cooperation in the strategic sector, including industry, was agreed by the two leaders of the country in November 2017 to encourage inclusive and sustainable economic growth for both countries.

"President Joko Widodo's state visit to Seoul last month also opened up greater opportunities to strengthen mutually beneficial cooperation for both parties in various fields, such as the implementation of industry 4.0," he said when representing the Indonesian Government in the National Day & Armed Forces Republic of Korea in Jakarta, yesterday.

Airlangga explained that South Korea is a key partner for Indonesia in collaborating in the industrial, investment and trade sectors.

"The established cooperation can encourage the national manufacturing industry to further increase the added value of domestic raw materials through downstreaming as well as adding to the absorption of local labor," he said.

South Korea's investment value continues to increase, making it the third largest in Indonesia. Until the middle of this year, the value had reached USD1.15 billion, while in 2017 it was USD2.2 billion. South Korean companies in Indonesia have absorbed 900,000 local workers.

The trade potential of the two countries is also still quite large. In 2017, the trade balance between Indonesia and South Korea experienced a surplus of USD78 million from the total trade value which reached USD17 billion. It is projected that the trade value of the two countries will increase with a target of USD30 billion in 2022.

"Although trade cooperation has been strong, it needs to be improved in an effort to reduce barriers and explore more opportunities, especially collaborative actions in the manufacturing sector to strengthen a sustainable and robust industrial structure," he explained.

Airlangga said that several prospective manufacturing industry sectors were explored for cooperation between Indonesian and South Korean businesses, including metal, automotive, chemical, shipping, electronics, textile and textile products, footwear, electrical wiring, energy, and small industries. and medium.

"In addition, to support industry 4.0, the two countries agreed to synergize in the development of human resources," he added.

At the 2018 Indonesia-Korea Business and Investment Forum in Seoul, last September, there were six Ginseng State companies that had expressed interest in investing in Indonesia. The total investment commitment reached USD 446 million.

First, LS Cable & System partnered with PT Artha Metal Sinergi for the development of a $ 50 million power cable industry sector in Karawang, West Java. Second, Parkland poured funds in the amount of USD75 million to build a footwear industry in Pati, Central Java. Third, Sae-A Trading invested up to USD36 million for the textile and garment sector in Tegal, Central Java.

Furthermore, fourth, Taekwang Industrial will build a footwear industry worth USD100 million in Subang and Bandung, West Java. Fifth, World Power Tech with its local partner PT NW Industries, which invested USD85 million to develop turbine and boiler manufacturing industries in Bekasi, West Java. As well as the sixth, InterVest with Kejora Ventures which invests USD100 million for startup financing services (venture capital) in DKI Jakarta.

"A number of other companies, such as Cheil Jedang, Lotte Group, Posco, and Hyundai Group are also committed to continuing to increase their investment in Indonesia," said Airlangga.

Moreover, the automotive, chemical and textile and apparel industries were the sectors that were prioritized for their customers to become pioneers in the implementation of the fourth industrial revolution according to Making Indonesia 4.0.

"Indonesia also welcomed positive results from the 3rd Inter-Korean Summit in Pyongyang recently. We hope that this important momentum can bring a new era for peace, stability, prosperity and support the Korean peninsula to be free from the threat of nuclear weapons. Indonesia is also ready to contribute to uphold peace and prosperity in the region, "closed the Minister of Industry.