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Sunday, June 9, 2024

Australia to Invest $50 Million in Indonesian Clean Technology Startups and SMEs for Energy Transition


In a significant move to bolster clean technology and energy transition in Indonesia, the Australian federal government has pledged a $50 million investment in Indonesian startups and small to medium-sized enterprises (SMEs). The investment falls under the Australia-Indonesia Climate and Infrastructure Partnership, a $200 million initiative unveiled last year, which aims to support clean energy, climate technology, and climate change projects in Indonesia, including carbon capture and storage and green energy smelters.

The partnership seeks to attract private sector capital to climate finance in Indonesia, with the government anticipating that each $1 invested would attract an additional $3 of private capital, fostering greater sustainability efforts in the country.

During a bilateral meeting between Australian Prime Minister Anthony Albanese and Indonesian President Joko Wododo, held during the latter’s three-day visit to Australia, both leaders discussed ways to strengthen collaboration in the electric vehicle (EV) supply chain. President Wododo expressed Indonesia’s ambition to become a global leader in EV manufacturing and sought to deepen joint efforts in battery and electric vehicle production. While no formal agreement has been signed yet, the discussions signal a potential pathway for enhanced cooperation in this critical domain.

Additionally, the Australian government-owned Export Finance Australia will establish a US$200 million capital financing facility for energy transition projects in partnership with PT Perusahaan Listrik Negara, the Indonesian government-owned energy company.

The leaders also welcomed a critical minerals investment plan of action between the Western Australian government and Indonesia’s Chamber of Commerce and Industry, aiming to develop resilient and sustainable supply chains, prioritize environmental and social governance, and cultivate a skilled workforce.

Moreover, the Australian Prime Minister announced that three Australian universities – Western Sydney University, Deakin University, and Central Queensland University – would set up campuses in Indonesia, furthering educational and research collaboration between the two countries.

As part of the bilateral agreements, Australia would extend the duration of business visas for Indonesians from three to five years and offer eligibility for the frequent traveler visa, granting a 10-year visa validity.

Wednesday marked the third anniversary of the Australia-Indonesia free trade agreement, with the bilateral trade in goods and services reaching $23.3 billion in 2022.

President Widodo is scheduled to visit Australia again in March 2024 during the ASEAN Summit hosted by Australia, fostering ongoing diplomatic and economic cooperation between the two neighboring nations.


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