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Foreign and Military Affairs

Indonesia wins loans and deals

By Li Xiaokun and Qin Jize (China Daily)
Updated: 2011-04-30 07:46
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JAKARTA, Indonesia - China on Friday offered multibillion-dollar loans and $10 billion worth of business contracts to Indonesia, further strengthening trade and investment ties with Southeast Asia's largest economy.

Visiting Premier Wen Jiabao announced these at a press conference after hour-long talks with Indonesian President Susilo Bambang Yudhoyono.

Indonesia wins loans and deals

China's Premier Wen Jiabao (L) shakes hands with Indonesia's President Susilo Bambang Yudhoyono during a meeting at the Merdeka Palace in Jakarta, April 29, 2011. [Photo/Xinhua]

The offers include a $1 billion preferential buyer's credit - the largest that Beijing has ever given a foreign country, as well as $8 billion worth of financing contracts for investors in Indonesia's much-needed infrastructure projects and major industries.

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The business delegation representing 150 Chinese companies which accompanied Wen will sign contracts valued at about $10 billion with Indonesian companies on Saturday.

Wen arrived in Jakarta late Thursday after a two-day visit to Malaysia, kicking off the first official visit of a Chinese premier to Indonesia in a decade.

Gita Wirjawan, Indonesia's investment chief, told media earlier that China Investment Corp plans to offer $4 billion of the $8 billion financing contracts. Other Indonesian officials have said the Export-Import Bank of China and Industrial and Commercial Bank of China are also involved in the program.

"I believe through joint efforts, it's completely feasible for us to raise bilateral trade volume to $80 billion in 2015," Wen said.

Bilateral trade volume reached $42.7 billion in 2010, a 50.6-percent surge upon the last year.

During the talks, the two sides agreed to establish regular meeting mechanism between the leaders of the two countries and a strategic dialogue will be set on the vice-prime minister level.

In the field of maritime cooperation, the two countries decided to set up a committee on the issue.

Wen said China will provide 1 billion yuan to start a fund for the program for tangible cooperation ranging from maritime security and research to resources exploitation and disaster prevention.

China has no territorial disputes with Indonesia in the South China Sea but the two sides still have maritime rights and interests to be settled.

The agreements came two days after China and Indonesia set up a joint oceanic observation station in Padang, the capital of Indonesia's West Sumatra province, the first time for China to jointly establish an overseas observation station with a foreign country.

Yudhoyono said he is happy to hear Wen's proposals and invited Chinese companies to Indonesia's massive plan of the building of six "economic corridors" in the coming 15 years.

"We expect more cooperation, which will make China's economy grow faster so that the world's second largest economy can further help with Asia's economic recovery," he said.

He told reporters the two countries also reached agreement on defense cooperation, without elaborating.

Besides, he said Wen also discussed with him how China can move together with members of the Association of Southeast Asian Nations to stabilize prices of grains and oil to ensure food and energy security in the region.

Analyst Dewi Fortuna Anwar of the Indonesian Institute of Science told Reuters that Wen's visit was going to be both symbolic and substantive.

"This is a reaffirmation of the increasingly close bilateral relations between the two," he said.

Indonesian Ambassador to China Imron Cotan told The Jakarta Post earlier this week that "China is very eager to invest and do business with us and I believe this country puts no preconditions on its economic offers".

"Moreover, different from other countries, they are willing to transfer their technology to us while building businesses in Indonesia," he said.

Imron said China was sincere in boosting its relations with its Southeast Asian neighbors as the country realized that it needed stable and prosperous surroundings to continue to progress.

Wen will wrap up his two-day Indonesia visit and fly back to Beijing on Saturday.

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