ASIATODAY.ID, JAKARTA — Ahead of the 2025 APEC Summit in Gyeongju, South Korea, the growing economic partnership between Indonesia and South Korea is increasingly shaping the economic growth of the Asia-Pacific region.
The collaboration between the two nations has become one of the key pillars driving industrialization, downstream development, and sustainable economic transformation.
The statement was made by Prof. Tirta Nugraha Mursitama, Deputy for Investment Cooperation at Indonesia’s Investment Coordinating Board (BKPM), during a public discussion titled “APEC at the Crossroads: Building Bridges for Regional Growth” hosted by the Foreign Policy Community of Indonesia (FPCI) in Jakarta on Monday, October 13, 2025.
“The Indonesian government is fully committed to developing an integrated electric vehicle industry, and South Korea plays a vital role through Hyundai and LG in building that ecosystem,” Tirta said.
A New Era of Strategic Cooperation
Amid the global economic dominance of the United States and China, Indonesia–South Korea cooperation represents a new axis of regional growth, focusing on technology, green industry, and digital innovation.
Between 2020 and 2024, South Korea ranked seventh among Indonesia’s top sources of foreign direct investment (FDI), with a total value of USD 11.3 billion (approximately IDR 185 trillion).
“South Korea is not only bringing capital but also technology, expertise, and knowledge transfer to local partners. This forms the foundation for Indonesia’s new wave of industrialization,” Tirta explained.
The partnership spans key sectors such as electric vehicles, semiconductors, renewable energy, export-oriented manufacturing, and the digital economy — all priority sectors under President Prabowo Subianto’s administration.
Downstreaming at the Heart of Indonesia’s Economic Strategy
According to Tirta, industrial downstreaming remains at the center of Indonesia’s economic strategy under President Prabowo. The goal is to transform the country from a mere raw material exporter into a regional manufacturing and technology hub.
“President Prabowo has emphasized that downstreaming is the main vehicle for rebuilding industrialization. Our target is clear: 8 percent economic growth and more than IDR 13 trillion in new investments,” he stated.
As of September 2025, Indonesia had achieved 15 percent of its annual investment target, with 30 percent of the total coming from the manufacturing sector.
BKPM has identified nine strategic sectors as national priorities:
1. Renewable energy
2. Industrial downstreaming
3. Semiconductors
4. Food security
5. Digital economy
6. Export-oriented manufacturing
7. The new capital city (IKN Nusantara)
8. Healthcare
9. Education
“We have prepared comprehensive roadmaps and incentive packages for each sector to provide clarity and confidence to global investors,” Tirta added.
Despite strong bilateral cooperation, Tirta highlighted the need to promote investment equality beyond Java Island. He emphasized the importance of strengthening infrastructure in Sumatra, Kalimantan, Papua, and Maluku to attract greater foreign investment to these emerging regions.
“Strong connectivity and infrastructure are key to ensuring investment is not concentrated only in Java,” he said.
APEC 2025: A Platform for Regional Collaboration
The 2025 APEC Summit, scheduled for October 31–November 1 in Gyeongju, South Korea, is expected to be a crucial moment for Indonesia and South Korea to reaffirm their commitment to regional economic cooperation.
Tirta emphasized that South Korea holds a unique position as a bridge between major powers and emerging economies in the Asia-Pacific, while Indonesia can play a leading role in promoting sustainable, inclusive, and digitally-driven growth.
“The challenge for Indonesia is to ensure that its investment-led growth strategy aligns with APEC’s agenda for sustainable and inclusive economic development,” Tirta concluded. (AT Network)
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