Indonesia, Australia Explore Enhanced Cooperation in Energy and Green Economy
Jakarta, The Gulf Observer: Secretary of the Coordinating Ministry for Economic Affairs, Susiwijono Moegiarso, engaged in discussions this week with Secretary of the Australian Department of Climate Change, Energy, Environment, and Water, David Fredericks, focusing on enhancing cooperation in the energy transition and green economy sectors.
“Australia is an important partner for Indonesia. In 2023, Australian foreign direct investment (FDI) in Indonesia grew by 4.0 percent, or US$545.2 million. We see great potential in developing pilot projects for energy transition cooperation, especially in remote areas under the KINETIK (Partnership for Climate, Renewable Energy, and Infrastructure) Framework Program,” stated Moegiarso in a statement released by his office on Wednesday.
The meeting formed part of a series of visits by Secretary Fredericks to Indonesia, aimed at deepening the understanding of the potential for bilateral cooperation in the energy transition.
The discussions also sought to gather perspectives from stakeholders in Indonesia, including the Coordinating Ministry for Economic Affairs, on closer cooperation in industrial and environmentally friendly energy sectors, as well as investment priorities between the two nations.
“Indonesia and Australia can collaborate closely to meet the needs of third countries in the region through the development of environmentally friendly energy industrial sectors and investment priorities,” remarked Fredericks.
He further outlined potential future collaborations under the KINETIK Framework Program to support the Indonesian government’s clean energy initiatives.
The KINETIK Framework Program follows a commitment made by the Indonesian president and the Australian prime minister at the 2023 Indonesia-Australia Annual Leaders’ Meeting (ALM).
KINETIK aims to implement concrete projects in the environmentally friendly energy sector, bolstered by Australian cooperation programs such as the Indonesia-Australia Partnership Program for the Economy (PROSPERA), and to increase the involvement of business actors from both countries.
During their meeting, Moegiarso and Fredericks also agreed to identify new opportunities in investment and trade in the renewable energy sector, particularly in solar power technology, hydrogen technology, and carbon capture and storage (CCS), which could expedite the efforts of both countries to achieve net zero emissions (NZE).
Fredericks introduced the Australian Clean Energy Finance Corporation (CEFC), which can support the Indonesian government by enabling Indonesian experts to collaborate in Australia on sustainable energy transition projects.
Moegiarso emphasized the positive trajectory of Indonesia-Australia trade relations since the implementation of the Indonesia-Australia Comprehensive Agreement (IA-CEPA). He expressed hopes that leveraging existing trade cooperation would attract more investment to Indonesia.
“We invite Australian businessmen to invest in Indonesia by taking advantage of various incentives and facilities in special economic zones (SEZs). Of the 21 existing SEZs, there are 10 SEZs with a special focus on the energy sector,” he added.
Fredericks agreed that the private sector plays a crucial role in energy transition and green economy collaboration. Additionally, both countries need to foster greater interaction between their people.
Moegiarso affirmed that the new Indonesian government would continue the priority programs of the current administration, especially concerning Indonesia’s accession to the Organisation for Economic Co-operation and Development (OECD) and the energy transition towards NZE.
