Jakarta. Indonesian companies are awaiting a bilateral investment treaty between Jakarta and Tanzania so they can feel more confident about investing in the East African country.

Indonesia is currently exploring opportunities in non-traditional markets. Companies are also starting to eye the untapped business potential in Africa with some firms already securing memoranda of understanding (MoUs). The tourist haven of Bali is also about to host the Indonesia-Africa Forum (IAF), which brings leaders and business representatives from the said continent, on September 1-3.  Economic cooperation will likely be on the agenda of this conference.

Earlier this year, President Joko “Jokowi” Widodo told his Tanzanian counterpart Samia Suluhu Hassan that both countries should establish a bilateral investment treaty. For reference, such a treaty typically provides legal protection and business certainty for foreign investors. As Indonesia looks to increase its investments in Tanzania, Jokowi finds this treaty necessary. It appears businesses are keeping their fingers crossed for this treaty to take shape. ESSA Industries Indonesia, which operates the country's largest private-owned liquefied petroleum gas refinery, sees the treaty as a major confidence booster. 

“I think such a treaty is incredibly important,” Kanishk Laroya, the chief executive officer and president director of ESSA , said at a virtual IAF-related presser on Thursday.

“If a bilateral investment treaty is in force, Indonesian companies will be far more confident about investing in Tanzania. It is an uncharted territory [for Indonesian businesses] to explore. We still have not fully grasped the legal basis and common laws. Such a treaty should be really helpful,” Kanishk told the press.

ESSA not long ago inked a deal for a natural gas-to-urea-fertilizer production, according to the Tanzanian publication The Citizen. The partnership involves Tanzania Fertilizer Regulatory Authority (TFRA) and Tanzania Petroleum Development Corporation (TPDC). 

“We find Tanzania’s fertilizer sector to be attractive. … That is why we wish to explore this opportunity more,” Kanishk said.

State-owned oil firm Pertamina is another Indonesian company that is already working with Tanzania. Pertamina operates the gas field Mnazi Bay. It also provides capacity-building programs for TPDC employees.

“If there really is support from the government, I think [a bilateral investment treaty] will help us explore business opportunities in Africa. It should enable us to gain information [about Tanzania] and make it easier for us to invest there,” Litta Indriya Ariesca, the marketing director at Pertamina’s subsidiary Patra Jasa, told the same presser.