RI inks US$7.5b in deals with China
RI inks US$7.5b in deals with China
Primastuti Handayani, The Jakarta Post/Beijing
Following the signing of five agreements between the Indonesian
and Chinese governments, the private sectors of the two countries
followed them up on Friday by signing four agreements and three
memorandums of understanding worth more than US$7 billion in
energy and infrastructure.
President Susilo Bambang Yudhoyono and Chinese Deputy Prime
Minister Zhen Pey Yan witnessed the signing of the agreements at
the China World Hotel in Beijing.
The four principal agreements cover the construction of two
power plants in South Sumatra, the Tuban refinery project and a
railway transportation system for coal mining also in South
Sumatra.
Indonesian Chamber of Commerce and Industry (Kadin) chairman
MS Hidayat briefed the press onboard a Garuda aircraft heading to
Shenzhen, saying the government was focusing the infrastructure
projects on energy in South Sumatra as the province had the
potential for coal mining.
"Some of the projects are expected to start this year. Once
the projects in the energy sector start, Chinese investment in
Indonesia will be one step ahead of Japan," he said.
"China has been very efficient in offering a price, which
could be 35 percent below Japan's," he added.
Elsewhere, South Sumatra Governor Syahrial Oesman said the
next step after the signing was pursuing necessary principal
permits from the Ministry of Energy and Mineral Resources and
state electricity firm PT PLN.
Other projects considered include the development of an oil
palm plantation along the border of Indonesia and Malaysia in
Kalimantan, the construction of a 400-hectare industrial estate
in West Java, and the development of a railway system for coal
connecting Tanjung Enim and Lampung.
Commenting on the involvement of tycoon Tomy Winata, who is
close to the military, in the construction of the industrial
estate in West Java, Hidayat argued that Tomy was well-connected
with Chinese businesspeople, particularly those from Guangzhou.
Earlier in the day, Susilo had one-on-one meetings with
Chinese businesspeople: governor of the China Development Bank
Chen Yuan; executive vice governor of the Export Import Bank of
China (EXIM Bank) Li Ruo Gu; chairman of the China Petroleum and
Chemical Corp. (Sinopec) Chen Tong Hai; president director of the
China International Trust and Investment Corp. (CITIC) Kung Dan;
president of the China Railways Engineering Corp. (CREC) Qin
Jiaming, managing director of the Microsoft Research Center Asia-
Beijing Harry Shum and country director of Microsoft Indonesia
Tonny Chen.
Principal agreements:
1. On the Tuban oil refinery project in East Java, between PT
Pertamina and Sinopec worth $2.4 billion.
2. On the Tanjung Jati project. A coal-fired power plant with a
capacity of 2x660 MW, between Chengda Engineering Corp., Bakrie
Power, the MSH Group and Bank of China worth $1.1 billion.
3. On a coal-fired power plant in South Sumatra, with a capacity
of 4x600 MW and investment of $2.1 billion to be financed by the
China Development Bank and China Exim Bank, and constructed by
Hua Dian Engineering, Indonesian consortium and state mining
company PT Bukit Asam.
4. On a railway and transportation system for coal in the Bukit
Asam mine connecting Tanjung Enim and Palembang, worth $500
million.
MOUs:
1. The project of a 2x100MW coal-fired power plant in S. Sumatra
worth $190 million, to be financed by China Bank.
2. The project of a 450-hectare Chinese industrial estate in
Karawang, West Java, worth $70 million.
3. The project of railway system for coal transportation linking
Tanjung Enim and Tarahan worth between $650-$750 million, to be
financed by Industrial Commersial Bank of China, EPC Contractor
China Railways Engineering Corporation.