Indonesia Could Benefit Greatly If Danantara Invests in US Oil and Gas Sector, Says Investment Ministry
JAKARTA — The Ministry of Investment and Downstreaming/Investment Coordinating Board (BKPM) believes Indonesia could reap significant benefits if BPI Danantara realises its planned investment in the oil and gas sector in the United States.
Deputy Minister of Investment and Downstreaming Todotua Pasaribu explained that the latest trade agreement requires Indonesia to eliminate import tariffs (0%) on goods originating from the United States. He noted that the agreement also contains a clause obliging Indonesia to purchase US energy products worth US$15 billion.
If Danantara invests in the US oil and gas sector, the government would only need to purchase from its own company operating in the US.
"It should be much better. If we invest there, we can buy our own products too, and when they come here the tariff on those products is 0%. This means our investment growth will be far better," said Todotua at the Coordinating Ministry for Economic Affairs office in Central Jakarta on Monday (21/7/2025).
Meanwhile, Moshe Rizal, Chairman of the Investment Committee of the Oil and Gas Companies Association (Aspermigas), said that Indonesia's oil and gas exports to and imports from the US are very limited. The United States is not a primary export destination for Indonesian oil and gas, and does not even rank among Indonesia's top five trading partners in the sector.
"So from the oil perspective, reciprocal tariffs don't really have much impact, because the US doesn't import oil or gas from us. So from the energy sector, we're not affected — it's not an issue," Moshe told Bisnis on Tuesday (8/7/2025).
He therefore urged the government to take a firm stance, arguing there is no need to push for increased imports of crude oil and LNG from the US. He noted that US President Donald Trump has disregarded Indonesia's negotiation efforts.
In those negotiations, Indonesia planned to spend US$34 billion, equivalent to Rp551.1 trillion (assuming an exchange rate of Rp16,209 per US dollar), on imports from the US. Of that total, US$15.5 billion or Rp251.24 trillion was allocated for energy purchases.
"We should be firm, we can be firm, because if Trump sees us as weak, we'll be squeezed even harder," said Moshe.
Furthermore, Moshe suggested that rather than increasing oil and gas imports from the US, the government should seek alternative export markets in other countries, which would be more beneficial in the long term.
Moshe reiterated that the government should not easily submit to the US, particularly as Indonesia holds considerable bargaining power in Southeast Asia. With this leverage, it should in fact be the US that needs Indonesia.
"For the US to counter China, Russia and others, it needs Indonesia's presence to maintain its position in the Pacific Ocean and Southeast Asia," said Moshe.
Deputy Minister of Investment and Downstreaming Todotua Pasaribu explained that the latest trade agreement requires Indonesia to eliminate import tariffs (0%) on goods originating from the United States. He noted that the agreement also contains a clause obliging Indonesia to purchase US energy products worth US$15 billion.
If Danantara invests in the US oil and gas sector, the government would only need to purchase from its own company operating in the US.
"It should be much better. If we invest there, we can buy our own products too, and when they come here the tariff on those products is 0%. This means our investment growth will be far better," said Todotua at the Coordinating Ministry for Economic Affairs office in Central Jakarta on Monday (21/7/2025).
Meanwhile, Moshe Rizal, Chairman of the Investment Committee of the Oil and Gas Companies Association (Aspermigas), said that Indonesia's oil and gas exports to and imports from the US are very limited. The United States is not a primary export destination for Indonesian oil and gas, and does not even rank among Indonesia's top five trading partners in the sector.
"So from the oil perspective, reciprocal tariffs don't really have much impact, because the US doesn't import oil or gas from us. So from the energy sector, we're not affected — it's not an issue," Moshe told Bisnis on Tuesday (8/7/2025).
He therefore urged the government to take a firm stance, arguing there is no need to push for increased imports of crude oil and LNG from the US. He noted that US President Donald Trump has disregarded Indonesia's negotiation efforts.
In those negotiations, Indonesia planned to spend US$34 billion, equivalent to Rp551.1 trillion (assuming an exchange rate of Rp16,209 per US dollar), on imports from the US. Of that total, US$15.5 billion or Rp251.24 trillion was allocated for energy purchases.
"We should be firm, we can be firm, because if Trump sees us as weak, we'll be squeezed even harder," said Moshe.
Furthermore, Moshe suggested that rather than increasing oil and gas imports from the US, the government should seek alternative export markets in other countries, which would be more beneficial in the long term.
Moshe reiterated that the government should not easily submit to the US, particularly as Indonesia holds considerable bargaining power in Southeast Asia. With this leverage, it should in fact be the US that needs Indonesia.
"For the US to counter China, Russia and others, it needs Indonesia's presence to maintain its position in the Pacific Ocean and Southeast Asia," said Moshe.