Jakarta. Senior minister Luhut Binsar Pandjaitan recently revealed that China would make a major petrochemical investment in North Kalimantan, arguing that Beijing’s current economic conditions did not diminish its interest in investing.

“Even though China, including all other parts of the globe, is facing tough economic conditions, they [China] have said that they would proceed with the petrochemical investment plan,” Luhut said in a recent video uploaded on his official Instagram account.

“[The investors] already got [China’s] approval on the amount of investment they would put into the petrochemical industry in North Kalimantan. Let's just wait. I hope nothing will go wrong,” Luhut said.

Luhut did not mention the name of the Chinese institution that would be making the investment.

However, news outlet Reuters reported last year that polyester fiber producers Tongkun Group and Xingfeming Group were awaiting the Chinese government’s approval to build a refinery and petrochemical complex in North Kalimantan. 

Also in the same video, Luhut talked of another investment related to the stainless steel downstream industry, which will produce spoons, forks, and even injection needles. 

“Speaking on the stainless steel downstream industry, … they [the investor] have asked to enter [Indonesia]. We will prepare a special area so local micro, small and medium enterprises [MSMEs] can reap the benefits [of this investment],” Luhut said.

Government data shows Indonesia attracted Rp 375.4 trillion ($24 billion) of investment in the overall downstream industry throughout 2023. The investment in the petrochemical industry totaled Rp 46.3 trillion in 2023. About Rp 136.6 trillion went to nickel smelters. 

China was Indonesia’s second-largest source of foreign direct investment (FDI). Throughout 2023, China invested a total of $7.4 billion in Indonesia.