Jakarta. Indonesia is seeking Singapore's help against export under-invoicing amid simmering tensions, as Jakarta has had enough of losing hundreds of billions of dollars from dishonest exporters.

Both governments agreed to form a joint task force to combat the haze that has been choking the region when their respective top diplomats, Indonesia’s Arrmanatha Nasir and Singapore’s Vivian Balakrishnan, met in Jakarta on Tuesday.

The task force is expected to share financial intelligence and data on companies linked with the haze as Jakarta seeks to follow the money.

Speaking to the press, Arrmanatha unveiled Jakarta’s wish to have a similar mechanism on “under-invoicing”. The Prabowo Subianto administration has waged war against this practice of invoicing export goods below their market price, typically to hide profits and evade taxes. Government estimates claim Indonesia lost up to $908 billion from under-invoicing between 1991 and 2024. 

“This [haze] cooperation is a first step. It is our hope that it can also pave the way to tackle other shared challenges such as under-invoicing. These practices generate revenues that should be [used to] build schools, hospitals, and help food security for our people,” Arrmanatha said, standing right next to Balakrishnan. 

“Today’s cooperation on haze can become tomorrow’s partnership on financial integrity.”

Arrmanatha did not go into more detail, although he did say that they were both on the same page of wanting greater commerce.

Balakrishnan’s ten-minute remarks to the media did not mention the under-invoicing. He did say that Singapore wants to see a “prosperous, stable, and peaceful Indonesia” for the city-state to succeed.

The fight against trade malpractices first emerged after Prabowo ordered tighter state oversight over key commodity exports, including palm oil. It eventually led to the establishment of Danantara Sumberdaya Indonesia (DSI), which will be in charge of this export control.

Former Finance Minister Purbaya Yudhi Sadewa also alleged that the under-invoicing practices involved palm oil exports routed through Singapore-based trading firms, where they would buy the commodities at half the market price. The commodities would then be resold to other countries at full market value.

Indonesia’s trade with Singapore totaled $22.9 billion this year as of August, government data showed.

However, Vivian’s visit came against the backdrop of a widening rift. The diplomatic spat between the neighbors stemmed from the bad haze that clouded Singapore’s skies, which eventually grew following negative online sentiment and Jakarta’s natural gas export cuts. Most recently, Indonesia fired back at a former Singaporean politician’s threat to cut underwater internet cables.

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