September 19, 2019 / 6:28 AM / 2 months ago

Indonesia says Abu Dhabi extends investment proposals worth at least $1 bln

JAKARTA, Sept 19 (Reuters) - Indonesia is considering investment proposals from Abu Dhabi’s sovereign wealth fund worth at least $1 billion, an Indonesian minister said on Thursday.

The proposals offer two scenarios for the Abu Dhabi Investment Authority (ADIA) to invest in Southeast Asia’s largest economy, Luhut Pandjaitan, Indonesia’s coordinating minister of maritime affairs, said in a statement.

In one of the scenarios, the fund could directly invest about $1 billion in property projects including in tourism areas.

Another option is for Jakarta to set up a new Indonesia Sovereign Wealth Fund (SWF), which will become a pool for funds from various foreign governments, and the United Arab Emirates could contribute up to $10 billion in stages for infrastructure financing or other investments.

“The UAE will visit Indonesia next month to meet with the finance ministry and PT SMI to discuss the scheme, regulations and laws needed to support the formation of the SWF,” said Pandjaitan, who is in the capital of the United Arab Emirates (UAE) on an official visit.

PT SMI, or Sarana Multi Infrastruktur, is a state-owned infrastructure financing company.

Investors from the UAE have agreed to invest in a 100,000 hectare (247,105 acres) plantation for tropical fruit in Indonesia’s Central Kalimantan province, Pandjaitan also said without naming them.

Abu Dhabi has also invited Indonesian President Joko Widodo to visit the emirate in January 2020 to follow up on commitments worth $9.7 billion signed during Crown Prince Sheikh Mohammed bin Zayed al-Nahyan’s visit to the Indonesian capital in July.

Reporting by Bernadette Christina Munthe in Jakarta; Writing by Gayatri Suroyo; Editing by Stephen Coates

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