China’s answer to job creation in Indonesia will determine future of bilateral economic ties

By Hu Weijia Source:Global Times Published: 2018/5/2 22:28:39

Chinese Premier Li Keqiang is set to visit Indonesia soon, having met with Indonesian presidential envoy Luhut Binsar Pandjaitan in Beijing on April 12. Frequent high-level visits between the two countries offer opportunities to lift bilateral economic ties to a new level.

Once a nation full of anti-China sentiment, Indonesia is currently a key destination in Southeast Asia for outbound investment from China. In 2017, China was the third-largest foreign investor in Indonesia with a total of $3.4 billion, according to the Indonesia Investment Coordinating Board. China may soon exceed Singapore and Japan as Indonesia's largest source of investment.

Bilateral investment cooperation has entered the "fast track." The two countries in April signed five cooperation contracts valued at $23.3 billion, and close interaction between their leaders suggests there's more good news to come. Economic issues like investment are expected to be among the key topics that Li will discuss with Indonesia's leadership during his upcoming visit.

China and Indonesia have wide scope for economic and investment cooperation. Indonesia is the largest country in Southeast Asia in demographic terms. But some statistics show that only 26 percent of people in the country have a bank account. There is plenty of room for growth in the market.

A handful of Chinese brands have become popular in Indonesia, bringing investment and technology. The two countries have also expressed an intention to align the Belt and Road initiative with Indonesia's development strategies. Earlier this year, the Indonesian government included 222 projects and three programs into its national strategic projects consisting of road development, dams, energy and other plans. China is willing to foster economic cooperation in various fields to expand bilateral ties.

As Chinese companies increase their presence in the country, Indonesian companies are sometimes feeling great pressure from their Chinese competitors. The general public has complex emotions toward China's economic rise. We believe most people hope bilateral economic ties can be taken to a new level, but political wisdom from both sides is also needed to make sure things run smoothly.

The key point now is jobs. Chinese enterprises need to create jobs to spur growth in Indonesia. Whether Chinese investment can boost the employment of young people will determine the future of bilateral economic relations. We believe Chinese companies will do a good job in this regard.

The author is a reporter with the Global Times. bizopinion@globaltimes.com.cn



Posted in: EYE ON ECONOMY

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