Indonesia Investment Authority (INA) and British International Investment (BII) announced a strategic partnership on July 18 aimed at advancing sustainable economic development and cooperation, particularly in the green sector.
Both parties said in a statement that the partnership, formalized through an Investment Framework Agreement (IFA) between the two nations, will focus on green infrastructure, renewable energy, climate resilience and adaptation, as well as related fields.
Through this IFA, the two countries seek to create a more favorable environment to facilitate investments and partnerships in private sector businesses in Indonesia. This will allow them to achieve optimal risk-adjusted returns on invested capital while fostering sustainable economic growth and addressing global climate challenges.
As part of its current 2022-2026 investment strategy, BII re-entered the Southeast Asian market, including Indonesia, with plans to invest up to GBP 500 million (approximately USD 654.83 million) across the capital structure to support the region's green energy transition. Previously, BII had invested in run-of-river hydropower and wind projects through a joint venture with SUSI Asia Energy Transition Fund (SAETF) and Pacific Impact.
On the other hand, INA has designated green energy and transition as one of its priority investment sectors, with a focus on supporting Indonesia's transition towards renewable energy. This commitment is evident in its strategic investment in PT Pertamina Geothermal Energy, Indonesia's largest geothermal energy company, and its collaboration with Contemporary Amperex Technology Co., Limited in establishing the Green Electric Vehicle Fund.
This collaboration signals a new chapter in the economic relationship between Indonesia and the UK, with potential for substantial mutual benefits. It aims to create pathways for resilient and sustainable economic growth, offering a platform for innovation and synergy in investments between the two nations.