African Nations to Sign $3.5 Billion Trade and Investment Deals with Indonesia

African countries are set to sign up to $3.5 billion worth of deals with Indonesia at the ongoing Indonesia-Africa summit, a senior diplomat informed Bloomberg. The agreements will be announced at the Indonesia-Africa Forum, which runs until Tuesday in Bali, according to Vice Foreign Affairs Minister Pahala Mansury.

These anticipated deals mark a significant increase from the $600 million agreements signed at the forum’s inaugural meeting in 2018. Key partnerships include Indonesian utility PT Perusahaan Listrik Negara teaming up with Tanzania Electric Supply Co. Ltd. for geothermal energy development, and PT Bio Farma collaborating with Ghana’s Atlantic Lifesciences Ltd. on health technology transfer. The foreign affairs ministry also mentioned that Congo and Senegal are interested in purchasing and maintaining aircraft from PT Dirgantara Indonesia.

Vice Foreign Affairs Minister Pahala Mansury highlighted Indonesia’s need to collaborate with Africa due to the scarcity of critical minerals required for battery production within Indonesia. He also emphasized the importance of cooperation among Global South countries amid geopolitical tensions between economic superpowers, stating, “This is a very good opportunity for Global South countries to work together rather than treat each other as competitors.”

In related news, PT Pertamina’s President Director Nicke Widyawati noted that the company is exploring opportunities with Guma Group Ltd. to construct a power plant in South Africa using gas supplied from Mozambique, as reported by local media outlet Bisnis.

Indonesia has been working to diversify its trade relationships beyond major partners like China, the US, and Japan, especially in light of challenges posed by a slowing Chinese economy, weak commodity prices, and rising protectionism. In 2023, Africa accounted for only $6.9 billion of Indonesia’s exports, representing less than 3% of its total shipments. Africa’s resource wealth positions it as a crucial partner in Indonesia’s plans to leverage its nickel reserves for battery production.

With the US and EU imposing tariffs on China-made electric vehicles, Indonesia and Africa have an opportunity to collaborate on building a more resilient global battery supply chain, the diplomat suggested.