Jakarta. Indonesia’s sovereign wealth fund Danantara is reviving talks with Boeing Co. over a long-delayed aircraft cooperation deal with state-owned flag carrier Garuda Indonesia, as the Southeast Asian nation looks to deepen economic ties with the US amid ongoing trade negotiations.

Danantara CEO Rosan Roeslani said he met with Boeing Southeast Asia President Penny Burtt and the company’s head of global government relations on May 10 to explore the US planemaker’s readiness to resume collaboration with Garuda. While the discussion didn’t include new investment proposals, it focused on reviving pre-pandemic commitments that were put on hold.

“This is about Boeing’s preparedness to work with Garuda again. The internal review is ongoing on both sides,” Rosan said Tuesday at the State Palace in Jakarta. 

Roeslani declined to elaborate details of the previous commitment. Boeing and Garuda were previously engaged in a now-stalled deal, delayed by the global travel downturn during the COVID-19 crisis.

Indonesia’s State-Owned Enterprises Minister Erick Thohir confirmed talks are underway to procure new aircraft for Garuda. “We are speaking with Boeing,” he told reporters Tuesday.

He said the prior agreement was shelved following a Boeing safety incident. On Jan. 9, 2021, Sriwijaya Air flight SJ182, a Boeing 737-500, crashed due to a malfunctioning autothrottle system that was not properly monitored by the pilots.

Despite Boeing’s ongoing quality control woes, Indonesia is accelerating Garuda’s fleet expansion strategy. The carrier operated 56 aircraft as of October 2024, while its low-cost arm Citilink managed another 40, bringing the total to 96 aircraft. Garuda plans to add 15 to 20 aircraft this year, aiming to hit 100 by year-end.

The airline is streamlining its fleet by standardizing aircraft types: Boeing 737-800NGs for short-haul routes, Airbus A330s for medium-haul operations, and Boeing 777-300ERs for long-haul international service.

The renewed dialogue with Boeing also comes amid broader trade negotiations between Jakarta and Washington. Indonesia is seeking tariff relief following US President Donald Trump’s April 2 decision to impose a 32 percent tariff on Indonesian exports, on top of a 10 percent baseline duty.

In a bid to ease tensions, Indonesia has offered to increase imports of US liquefied petroleum gas, gasoline, soybeans, soybean meal, and capital goods, according to Chief Economic Affairs Minister Airlangga Hartarto.

From April 16 to 23, Indonesian officials held meetings with key US economic officials, including Commerce Secretary Howard Lutnick, Trade Representative Jamieson Greer, and Treasury Secretary Scott Bessent. Airlangga claimed that major US firms, including Boeing, Amazon, Microsoft, and Google, have expressed support for Indonesia’s position in the ongoing trade talks.

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