Jakarta. The Indonesian sovereign wealth fund Danantara has agreed to work with the Australian government to power a reciprocal flow of investments.

Danantara sealed the memorandum of understanding (MoU) when Australian Prime Minister Anthony Albanese made his official visit to Jakarta on Friday.

The document reflects Jakarta's intention to be not only an investment destination but also an investor in its close neighbor. Danantara — which oversees all Indonesian state-run enterprises — has listed infrastructure, energy, mining, and agribusiness as some of the sectors that the two-way investment will focus on. Beyond financing cooperation, the Australian MoU touches on human capital development. 

“I invite Australia to set up an agricultural joint venture in both countries to support Indonesia’s goal to beef up its food security,” President Prabowo Subianto told a joint press briefing, shortly after the MoU signing.

Prabowo hopes Australia will back Indonesia’s critical mineral industry, be it nickel, copper, bauxite, and gold processing. He called on Indonesian investors to check out Australia's mineral sector. He also pushed for "co-investment opportunities" involving Danantara.

Albanese is upbeat that the MoU can “bolster shared economic security and resilience”.

"Deepening Australia's economic engagement with Indonesia and with Southeast Asia more broadly has been a top priority for my government," he said.

Australian direct investments in Indonesia totaled $719 million throughout 2025, government data showed. This puts Australia as Indonesia’s ninth-largest foreign investor that year, just behind the Netherlands ($1.1 billion) and South Korea (almost $2 billion).

A bilateral free trade agreement has been in place since July 2020, which caused trade to surpass the ten-billion-dollar mark the following year. Trade even reached a zenith of $15.4 billion in 2024 before sinking to $13.1 billion in 2025.

The possible investment in critical minerals is no surprise, as both nations are abundant in metals key to new technologies. Australia’s lithium reserves reach 7 million metric tons. On the other hand, Indonesia does not produce this silver-white metal, according to the 2025 US Geological Survey report. Indonesia is home to the world’s largest nickel reserves at 55 million metric tons, with Australia coming in second at 24 million metric tons. 

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