UAE Minister of Energy Suhail al-Mazrouei (left) and Chairman of the Indonesian National Economic Council Luhut Pandjaitan (right) met in January to discuss collaboration opportunities in sustainable projects such as green energy and reforestation. (Image: Luhut's Instagram)
Indonesia’s newly established national investment institution, "Danantara," is set to officially launch on Feb. 24. Even before its official start, it has already received promising news.
Indonesian officials revealed that representatives from the United Arab Emirates (UAE) have expressed interest in collaborating, specifically targeting the development of renewable energy with an estimated capacity of 10 GW.
Danantara aims for 8% economic growth with $900 billion in assets
"Danantara" is part of President Prabowo Subianto’s economic policy, aiming to leverage a national sovereign fund to consolidate state-owned enterprise resources for investment projects. The goal is to achieve an 8% economic growth target.
The fund is projected to manage assets worth around $900 billion, with renewable energy, advanced manufacturing, downstream industries, and food production as primary investment sectors.
Originally planned for launch in November last year, "Danantara" was delayed until the Indonesian Parliament passed legislation on Feb. 4, ensuring its operation will begin on Feb. 24. The fund’s initial capital is set at $20 billion, sourced from government fiscal mergers, budget cuts, and dividends from state-owned enterprises.
Luhut Pandjaitan, Chairman of the Indonesian National Economic Council, stated at the Indonesia Economic Summit on Feb. 18 that "Danantara" has attracted attention from various countries, especially the UAE. He mentioned recent discussions with UAE’s Energy Minister Suhail al-Mazrouei, who expressed interest in establishing a joint venture to develop 10 GW of renewable energy.
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Danantara is one of the economic policies strongly advocated by President Prabowo Subianto. (Photo: Prabowo Subianto's facebook)
UAE, Indonesia energy cooperation expected to expand
However, Luhut did not provide the names of the companies involved, nor specify which type of renewable energy would be developed but emphasized that the UAE has been paying attention to "Danantara" for some time and expects the progress to move "very quickly."
This collaboration would not be the first between the two nations. They have previous experience in renewable energy projects, such as the joint effort involving Masdar and Indonesia’s state-owned electricity company, PLN, which developed Southeast Asia's largest floating solar power plant in Cirata, West Java. This facility is capable of supplying electricity to 50,000 households.
Despite still relying heavily on coal power, Indonesia has set ambitious climate goals under President Prabowo’s administration, including increasing renewable energy capacity by 75 GW by 2040. The government focuses on wind, solar, hydro, and geothermal energy. According to PLN, meeting these goals would require an estimated investment of $235 billion.
Source: Jakarta Post(1), (2), Jakarta Globe
