Indonesia, a member of the Group of 20, has been active in engaging with Africa since its birth in 1945. Just after 10 years of its freedom, in 1955, Indonesia hosted the first ever Asia-Africa Conference in Bandung to boost friendship, solidarity and cooperation among the people of both continents.

Indonesia, under the leadership of popular President Joko “Jokowi” Widodo wants to focus more on Africa to forge a strong economic partnership between the world’s biggest archipelagic nation and all 54 African countries.

In April 2018, Indonesia launched the first ever Indonesia-Africa Forum (IAF), which not only gave a new shape to the old and strong relations between Indonesia and Africa but also resulted in more than half a billion dollars of business deals in sectors of strategic industries, infrastructure financing, mining, textiles, aircraft maintenance and trade.

“Indonesia wants to be part of developments in Africa, and Indonesia also wants Africa to be part of developments in Indonesia,” Indonesian Foreign Minister Retno LP Marsudi said at the IAF meeting last year.

In an effort to provide more flesh and blood to the successful IAF initiative, Indonesia is organizing the Indonesia-Africa Infrastructure Dialogue (IAID) on the beautiful island of Bali from Aug. 20 to 21. The two-day international forum, which has a strategic theme of “Connecting for Prosperity” will be attended by 700 delegates from both Indonesia and 53 African countries.

Purpose

The infrastructure dialogue brings together business leaders, ministers, policymakers, senior government officials and all other stakeholders from Indonesia and Africa under one platform to exchange ideas, explore possibilities of collaboration and cooperation in the field of infrastructure and related sectors.

The dialogue will review the progress of economic cooperation and business deals signed at the IAF meeting in 2018 and become a place for signing new business and investment deals in infrastructure cooperation and other strategic industries.

But people may ask why the focus will be on infrastructure development?

Infrastructure is vital for every country’s economic development. It is the main priority for both Indonesia and Africa. It has multiple effects on the economy such as creating more jobs, smooth flow of goods and contributing to the prosperity of people and their countries.

In his major speech on “Vision of Indonesia” on July 14 this year, President Jokowi emphasized that infrastructure development was the first major stage to becoming a more productive and competitive country. Building more roads, railway lines, airports and seaports is a must for connectivity between urban areas and industrial zones, special economic zones and tourist destinations.

" Indonesia wants to be part of developments in Africa, and Indonesia also wants Africa to be part of developments in Indonesia "

No wonder Jokowi’s administration has been consistently allocating a huge budget for infrastructure development since he assumed his post in 2014. For example, Indonesia has allocated Rp 415 trillion (US$28 billion) for infrastructure projects in 2019, a huge jump from Rp 256.1 trillion in 2015.

Indonesia is expected to become the fourth-largest economy in the world by 2050. In order to achieve this, the Indonesian economy must grow sustainably, for which infrastructure development is vital.

Likewise, Africa, which has the second fastest growing economy in the world after Asia, needs to build more roads, bridges, railway lines, airports, seaports, houses, apartment complexes, office buildings, power plants and water facilities to prosper more in the coming years.

So Indonesia feels it is the right time to focus more on infrastructure in both Indonesia as well as Africa.

“Indonesia believes that the infrastructure sector will not only boost mobility of goods and services trade, but also encourage investments and support wide economic growth in the middle and long term. The importance of the sector can be reflected through the significant development of African infrastructure,” the Indonesian Foreign Ministry said in a concept paper on IAID.

Indonesia believes all investments and cooperation must be mutually beneficial for both Indonesia and Africa. Both should connect each other for mutual prosperity.

Africa: A land of opportunities

With its 1.32 billion people (2019 estimate), Africa offers many opportunities for Indonesia and its businesspeople. It is also the youngest continent as its present median age is just 19.4 years. Like Indonesia, Africa is very rich in natural resources. This year, the average overall growth of African countries will be 4.3 percent. Many countries in Africa have the potential to grow more than 5 percent in the next five years.

With rising incomes and the middle class population, Africa is indeed a paradise for companies to sell consumer goods. Indonesian products like palm oil, rubber, garments, food and beverages are already popular in many African countries.

Africa is also witnessing the highest growth in internet users. Hundreds of Indonesian start-ups are emerging as global players. There is huge potential for both Indonesia and Africa to cooperate and connect in the digital and fintech sectors.

That is why the opportunities and challenges in Africa will become the main topics of the dialogue

What is up for discussion?

There will be several panel discussions, business matchmakings between African and Indonesian companies and a business exhibition during the dialogue.

Panel sessions on strategic industries and economic diplomacy, connectivity, social infrastructure and tourism, energy and mining, financing scheme, trade and development cooperation will convene during the two-day event.

In a major shift in its economic policies, Indonesia is ready to launch negotiations on bilateral Preferential Trade Agreements (PTAs) with selected strategic African countries that will act as trading hubs, to spur trade not only bilaterally but with countries in the region. During the dialogue, Indonesia will either conclude or sign the first ever PTA between Indonesia and an African country, which was initiated during IAF last year.

Furthermore, on the sidelines of the event, Indonesia will engage in preliminary discussions and negotiations with other African countries. PTAs will lower trade tariffs, which will boost trade and contribute to economic growth,

To conclude the dialogue, there will be a joint press statement by Indonesia’s foreign minister, coordinating maritime affairs minister and trade minister to announce the various forms of cooperation achieved during the two days.

The IAID is a major initiative from Indonesia to connect and prosper with Africa.

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