Jakarta. Indonesia is aiming to become a key player in the global semiconductor supply chain through a strategic partnership with the United States, backed by nearly $5 billion in initial investment, Coordinating Economic Affairs Minister Airlangga Hartarto said on Tuesday.

The first phase of the semiconductor development project was formalized through a memorandum of understanding witnessed by President Prabowo Subianto in Washington on Feb. 18.

The collaboration brings together Indonesian technology firm Galang Bumi Industri, US-based Essence Global Group, and Tynergy Technology Corp as technology development partners.

Total investment for the semiconductor project is projected to reach $26.7 billion.

“Developing a semiconductor ecosystem is part of our national strategy to deepen Indonesia’s industrial structure and strengthen competitiveness in the global value chain,” Airlangga said in a statement. “Indonesia is no longer positioned merely as a technology market, but as a production base and hub for strategic technology development.”

The scope of cooperation includes manufacturing infrastructure, green industrial projects, workforce development, and joint research and development initiatives spanning wafer ingots and solar cell technologies.

Airlangga said the investment is expected to create around 5,000 skilled jobs across engineering, advanced materials, and next-generation energy systems, with the government prioritizing large-scale technology transfer to build domestic capabilities.

“This MoU is not just about financial investment. It represents Indonesia’s strategic repositioning within the global industrial architecture. We want to ensure Indonesia becomes part of the world’s semiconductor value chain, strengthens industrial self-reliance, and improves its bargaining power in global supply networks,” he added.

Construction of the industrial facilities is set to begin at the Wiraraja Green Renewable Energy and Smart-Eco Industrial Park on Galang Island near Batam in the Riau Islands, one of Indonesia’s designated National Strategic Projects.

Tynergy’s investment engagement dates back to the 2022 G20 Summit in Bali, following discussions with Industry Minister Agus Gumiwang Kartasasmita and facilitation by Indonesia’s embassy in Washington under then-ambassador Rosan Roeslani, now Indonesia’s investment minister.

Momentum continued during the 2023 Hannover Messe in Germany, where Indonesia served as an official partner country. This was followed by an investment commitment signed on Nov. 12, 2023, and a subsequent cooperation agreement between Tynergy Group and Galang Bumi Industri, the industrial park’s operator.

To accelerate implementation, the consortium has urged the government to fast-track outstanding permits so construction on the first phase can begin immediately.