This research maps Chinese investment in Indonesia, as well as analyzing its evolution following the introduction of the Belt and Road Initiative (BRI), formerly known as the One Belt One Road (OBOR) launched in 2013. Indonesia-China economic relations was disrupted by the Indonesian Communist Party’s coup attempt in 1965, which led the New Order government to suspend diplomatic relations with China in 1967. Indonesia-China diplomatic relations was normalized in 1990, but there was no significant economic cooperation until early 2000s, when China began to invest in Indonesian infrastructure like the Surabaya-Madura (Suramadu) bridge, Jatigede Dam and various power plant projects with state-owned electricity company “PLN”.
Following the launch of BRI, China has broadened its investment in Indonesia toward the extractive sector, specifically on nickel mining in Morowali, Central Sulawesi. The avenue for Chinese investment in Morowali was paved during the second period of Susilo Bambang Yudhoyono Presidency (2009 – 2014) through his Masterplan for Acceleration and Expansion of Indonesia’s Economic Development (MP3EI).
China uses the BRI as a vehicle to invest in Indonesia’s underinvested railway sector. The Jakarta-Bandung High-speed Railway is the first project. In the future, China expects to participate more in developing Indonesia’s railway system through its state-owned “China Railway”, including in the plan to build a railway system in Indonesia’s future capital proposed by President Joko Widodo.
Besides Chinese investment under the BRI umbrella, this paper also maps Chinese investments that are not mentioned in official documents like in e-commerce, financial technology, tourism, and manufacturing.