Indonesia will celebrate its 79th Independence Day on August 17th, 2024. This year, the Government of the Republic of Indonesia, a country with more than 281 million people and over 700 local languages, has conducted a General Election for the President and the Vice President. The one-day general election was the largest and most complex election system in the world. The President-elect, Prabowo Subianto, and the Vice President-elect, Gibran Rakabuming Raka, will be inaugurated on October 20th, 2024. Indonesia also conducted a general election for Legislative members for a 5-year term, 2024-2029, on February 14th, 2024. Meanwhile, the new members of parliament, the National House of Representatives (DPR RI) consisting of 580 members, and the Regional Representative Council (DPD RI) consisting of 152 senators, will be inaugurated on October 1st, 2024. Indonesia will also hold simultaneous regional head elections on the 27th of November 2024 to elect 37 Governors, 451 heads of Regency, and 93 mayors.
To commemorate the 79th Indonesian Independence Day, the Indonesian government will hold its ceremony in the new capital city of “Ibu Kota Nusantara (IKN)” (the Archipelago) in East Kalimantan (island of Kalimantan/Borneo) for the first time. This is in addition to the celebrations at the Presidential Palace in Jakarta. The ceremony at IKN will be attended by approximately 1,000 people. The Indonesian Government has been preparing and constructing the New Capital of the country on the Kalimantan Island.
Amid global economic uncertainty, the Indonesian economy grew by 5.08 percent in the first semester of 2024, while the balance of trade in the first semester showed a surplus of USD 15.49 billion. Meanwhile, the total trade between Indonesia and GCC countries for the period of January-May 2024 reached USD 6.2 billion. During this period, Indonesia’s exports to the GCC reached USD 2.7 billion, while Indonesia’s imports from the GCC were USD 3.5 billion. In 2023, total trade between Indonesia and the GCC reached USD 15.7 billion. That year, the value of Indonesia’s exports to the GCC region reached USD 6.1 billion, and the value of Indonesia’s imports from the GCC was recorded at USD 9.6 billion.
This data does not reflect the real potential between the GCC and Indonesia and suggests that more exploration is needed. For that reason, on July 31st, 2024, Indonesia and the GCC agreed to start negotiations on the Indonesia – Gulf Cooperation Council Free Trade Agreement (IGCC FTA).
Since the establishment of Indonesia’s diplomatic relations with Kuwait in 1968, cooperation between the two countries have increased at bilateral, regional, and international levels. At the bilateral level over the past year, this relationship has been marked by mutual visits from high-ranking officials from both countries, as well as agreements to improve relations and cooperation for the benefit of both brotherly nations. Both countries are also collaborating in many fields at the regional and international levels on issues of common concern.
On the economic page, there remains much homework to be done. Statistical data revealed that during the last five years, Indonesia-Kuwait bilateral trade has been declining. According to data released by the Indonesian Statistic Agency, the bilateral trade between the two countries in 2023 was USD 488.1 million, a 3.93% decline compared to USD 504.8 million in 2019.
In the investment sector, the outlook seems more encouraging, although much more can be done. According to data from Indonesia’s Investment Coordinating Agency, Kuwait’s investment in Indonesia over the last five years has been increasing. In 2019, Kuwait’s investment was USD 145,700, and it was recorded at USD 480,500 in 2023. During the first semester of 2024, Kuwait’s investment was recorded at USD 132,800. Among the Gulf countries, Kuwait’s investment lags behind that of the United Arab Emirates (USD 68,858,100), Saudi Arabia (USD 7,148,200), and Qatar (USD 1,367,900). Both Indonesia and Kuwait need to make more efforts to encourage increased Kuwaiti investment in Indonesia.
In fact, there are many investment opportunities in Indonesia, such as in the newly developed Indonesian Capital (Ibu Kota Nusantara or IKN), which has a total area of more than 324,000 hectares (256,000 hectares of land and 68,000 hectares of sea). Indonesia is determined to build its new IKN to be an integrated smart-forest city. As a newly developed city, IKN is open for investment in transport, connectivity, and basic infrastructure such as the provision of electricity, water, healthcare, and high-quality education.
Other investment opportunities include five super-priority tourism destinations, namely Lake Toba in North Sumatra, Borobudur Temple in Central Java, Mandalika Special Tourism Economic Zone, Likupang Beach in North Sulawesi Labuan Bajo. The Labuan Bajo area containing the Komodo National Park was listed as UNESCO’s World Heritage Site in 1991.
Indonesia and Kuwait are also working together on connectivity, especially air connectivity, to boost trade and tourism. In the health sector, both Indonesia and Kuwait are moving closer to working together, including capacity building for skilled workers.
The two countries share a long and rich historical culture, given their Muslim roots of society and the background of sailor ancestry. A good establishment of cooperation in the fields of culture and education is highly appreciated, and Indonesia looks forward to enhanced cooperation in both fields.
The Government of Indonesia strongly believes that the Government of the State of Kuwait, under the leadership of His Highness the Amir Sheikh Meshal Al-Ahmad Al-Jaber Al-Sabah, His Highness the Crown Prince Sheikh Sabah Al-Khaled Al-Sabah Al-Hamad Al-Mubarak Al-Sabah, and His Highness the Prime Minister Sheikh Ahmad Abdullah Al Ahmad Al-Sabah, will continue to explore all potentials existing between the two countries in strengthening cooperation for the prosperity and welfare of the two friendly nations.
