Jakarta (Indonesia Window) – The Indonesia Investment Authority (INA) and an Emirati multinational logistics company based in Dubai, DP World, have signed a strategic alliance agreement to improve the quality of maritime and logistics services in Indonesia.
The value of the long-term cooperation reached 7.5 billion U.S. dollars.
The collaboration between INA and DP World aims to improve the quality of Indonesia’s port operations, reduce logistics costs, and increase their competitiveness.
“Indonesia’s maritime and port sectors are the key to supporting inter-island trade and consumption,” said INA’s Chairman Board of Directors Ridha Wirakusumah here on Monday (Nov. 1).
In the future, DP World will bring world-class technologies to develop new terminals and other port assets in Indonesia so as to create efficiencies and increase inter-island and international logistic traffics.
DP World and INA will establish a consortium and a team work by exploring cooperation with Indonesia’s seaport management company PT Pelabuhan Indonesia to explore investment opportunities in various ports in the archipelagic country.
The investment opportunities include projects on hinterland ports, domestic terminals, cargo fields, network systems, transportation to and from ports, and industrial zones development.
DP World will also co-invest with Caisse de dépôt et placement du Québec (CDPQ) Canada which since 2016 has invested in 12 global port terminals at various stages of the asset management cycle.
According to Ridha, the strategic partnership with DP World is in line with INA’s mission to optimize investment in the infrastructure sector to boost long-term economic growth.
Moreover, Indonesia’s geographical condition as an archipelagic country with more than 17,000 islands requires a comprehensive marine logistics network.
Indonesia is currently among the top 15 countries in container traffic and is expected to continue to increase considering that domestic consumption and production levels continue to soar.
Therefore, Ridha stated that collaboration with DP World would enable Indonesia to solve various obstacles such as high logistics costs and inefficiency.
“We believe that DP World could work well together to create a qualified marine logistics network and provide added value for investors, businesses, and company employees,” he said.
Meanwhile, Chairman and CEO of DP World Group Sultan Ahmed Bin Sulayem said DP World is committed to supporting Indonesia’s initiatives in creating added value and modernizing maritime infrastructures.
DP World’s CEO and Managing Director for Asia Pacific and Australasia Glen Hilton added that the company would introduce world-class practices for operational optimization, service innovation, disruptive technology and logistics handling security principles.
The latest logistics technologies to be introduced include full automation to achieve efficiency, a hyper loop system for faster cargo delivery and the implementation of 100 percent electricity-based sustainable cargo transportation.
“We combine our capabilities and today’s disruptive technologies. We are optimistic that we could improve Indonesia’s supply chain performance,” Hilton said.
Reporting by Indonesia Window