Encourage Two-Way Investment between Indonesia and Australia

Australia's Business Envoy to Indonesia, Jennifer Westacott, has returned to Indonesia following her first visit in June 2024. This time, she brought a trade delegation from the Land of the Kangaroos consisting of 39 people. According to Westacott, this is the largest business delegation ever brought by Australia.

At the 2022 Association of Southeast Asian Nations (ASEAN) Summit in Jakarta, Australia established the Australia-ASEAN development cooperation scheme, spearheaded by economics and business expert Nicholas Moore. To facilitate this program, Australia appointed a business envoy for each ASEAN country. For Indonesia, this trust was given to Westacott, a professor and the Chancellor of Western Sydney University.

During the visit on February 10-13, 2025, Westacott brought an Australian delegation to meet, among others, with Minister of Finance Sri Mulyani, Minister of State-Owned Enterprises Erick Thohir, and Chief Commissioner of Bank Mandiri Chatib Basri. The delegation brought by Westacott operates in various fields, including banking, mining, and pension funds. They are interested in investing in sectors such as infrastructure, health, education, and mineral mining.

"Since 2024, Australian investment in Indonesia has increased by 34 percent. The enthusiasm of Australian entrepreneurs towards Indonesia has risen, and vice versa," said Westacott in Jakarta, Tuesday (11/2/2025).

The trade balance between Indonesia and Australia in 2023 is 26.7 billion Australian dollars. This amount has increased from 2022, which was valued at 18.3 billion Australian dollars.

He explained that this interest grew rapidly after Australian entrepreneurs learned that Indonesia is a stable country. Amid various political upheavals and international trade wars, Indonesia has proven to remain calm. Even during each change of government, there have been no major issues disrupting the investment climate and international trade.

In addition, every new government still has ambitions to improve the economy. The red line observed by Australia is Indonesia's commitment to building human resource competencies and increasing technological mastery.

According to Westacott, the mining sector remains a favorite. Both Australian and Indonesian companies are investing in each other's countries. The aim of enhancing this two-way economic cooperation is so that Indonesia does not only become a beneficiary country but also plays a role in the global economy by investing in Australia.

BNI, for example, now has a branch office in Australia. A number of Indonesian companies have also invested in mining companies in Northern Australia.

One of the major opportunities in the mining sector is the processing of minerals for electric vehicle batteries. Indonesia's exports to Australia in this sector are not subject to tariffs. Westacott acknowledged that there are still questions from Australian entrepreneurs about why processing and downstream activities must be carried out in Indonesia. Some entrepreneurs still think they only want to import raw materials.

"We explained that in the downstream process in Indonesia there is a lot of room for Australia to invest. This is a win-win situation. Investment can be in the field of human resources to technology transfer," he said.

Companies in Australia are accustomed to high regulatory standards, especially regarding the environment. That alone could be an area of cooperation. On the other hand, the Indonesian and Australian governments are also trying to streamline regulations to facilitate investment without sacrificing essentials.

Westacott explained that outside of mining and minerals, the education, health and clean energy sectors are also in demand. While in Indonesia, Westacott will inaugurate the opening of the University of Western Sydney Surabaya in East Java. This is the first foreign university to be allowed to open a bachelor's degree program in Indonesia.

Following the University of Western Sydney, there is Deakin University in Bandung, West Java and the University of Central Queensland in Balikpapan, East Kalimantan. According to Westacott, they all develop a 2+2 program, which is two years of study in Indonesia and two years in Australia. The goal is for students to have an international perspective.

"We are now trying to get students to do internships at Australian companies so they can really experience global work experience," he said.

There is also interest in developing educational cooperation in the teaching and nursing departments. The scheme is not only for undergraduate and postgraduate programs, but also various short course programs or more intensive exchanges. The Australian company Aspen Medical is among those interested in further exploring the health sector in Indonesia.

"Human resources are the basic capital for the nation's progress," said Westacott.

Australia is also monitoring the development of the free nutritious meal program. The number of 80 million free nutritious meals per day is very interesting from a supply chain perspective. Westacott said Australia is one of the largest dairy producers in the world. They are also looking for trade and investment opportunities.

President Prabowo Subianto said he wanted to make Indonesia food sovereign. Therefore, Westacott continued, one of the strategies offered by Australia is investment in nutrition education, increasing logistics capacity, and program management capacity.

Other less popular sectors are being developed. “In the new and clean energy sector, there are small companies interested in building partnerships,” Westacott said.