Central Java and East Kalimantan Explore Cooperation with Economic Potential of IDR 20.2 Trillion

The Provincial Government of Central Java and East Kalimantan are establishing cooperation across various sectors, with an economic potential estimated at IDR 20.2 trillion. This potential encompasses trade, food, industry, financial services, the creative economy, and support for the Nusantara Capital City (IKN) project. The collaboration was formalised with the signing of a cooperation agreement at Odah Etam, the East Kalimantan Governor’s Office Complex in Samarinda, on Thursday. The joint agreement was signed by Central Java Governor Ahmad Luthfi and East Kalimantan Governor Rudy Mas’ud, while technical cooperation documents were signed by respective heads of regional apparatus organisations (OPD), regional-owned enterprises (BUMD), associations, and regents/mayors. The IDR 20.2 trillion figure is an aggregation of various forms of potential cooperation and does not represent a single cash transaction or new investment. Central Java Governor Ahmad Luthfi expressed hope that the agreement would be promptly realised to help address fiscal limitations and global geopolitical challenges. East Kalimantan Governor Rudy Mas’ud stated that the collaboration is mutually beneficial and complementary, noting that Central Java has processing industries and MSMEs, while East Kalimantan possesses natural resources. He described it as an extraordinary breakthrough that could serve as a model for other provinces, reducing dependency on the state budget or central government transfers. In the food sector, the cooperation opens up trade potential for commodities from Central Java to East Kalimantan, including approximately 778 tonnes of eggs, 873 tonnes of chicken meat, 321.6 tonnes of shallots, and 6,119 tonnes of rice, with an estimated transaction value of IDR 237.75 billion. The partnership also covers livestock and animal health development, with an annual potential value of around IDR 2.1 trillion. In the industrial and trade sectors, the annual cooperation potential is estimated at IDR 36 billion, while in marine and fisheries, it is aimed at strengthening trade and supply chains with an annual value of approximately IDR 2.238 billion. Tourism and creative economy cooperation is estimated to generate direct transactions of around IDR 21 billion per year, with a multiplier effect of approximately IDR 36 billion annually. Among regional-owned enterprises, the largest potential business activity lies in the synergy between Bank Jateng and Bank Kaltimtara, valued at around IDR 15 trillion per year. Additionally, cooperation between Jamkrida Jateng and Jamkrida Kaltim through a co-guarantee scheme for IKN projects is projected to support projects worth IDR 1.34 trillion, with an estimated annual guarantee fee income of IDR 3.452 billion.