Equitable Joint Development: Toward Sustainable Prosperity for Indonesia and China

China is an important partner country for Indonesia. Economically, China plays a significant role in Indonesia’s national economy. This is evidenced by data from the Ministry of Investment and Downstreaming, which reported that as of the first quarter of 2026, China was the third-largest investor in Indonesia after Singapore and Hong Kong (BKPM, 2026). According to the data, the value of Chinese investment in Indonesia reached $2.2 billion, or, when converted at the exchange rate as of May 30, 2026, of Rp17,820, the amount totaled Rp39,212,800,000,000 (Wise.com, 2026). This is a substantial investment.

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This indicates that China is of great strategic importance to Indonesia. However, this situation stands in stark contrast to a recent development in which a group of Chinese businesspeople and investors, organized under the Chinese Chamber of Commerce, sent an open letter to President Prabowo Subianto. They voiced their grievances, stating that their business interests in Indonesia have been disrupted by numerous actions they consider detrimental to them. Examples include the imposition of tax rates deemed excessive, inconsistencies in legislation, the involvement of third parties strongly suspected of extorting them in connection with business dispute resolutions, and the classic problems of Indonesian bureaucracy (Yanwardhana, 2026).

Specifically, the Chinese businesspeople described in their letter to President Prabowo are those focused on extractive industries such as nickel mining. They feel as though they are merely being used to support Indonesia’s national development agenda. However, when it comes time for them to exercise their rights, Indonesian authorities make it difficult for them to do so.

The reality, as lamented by these Chinese businesspeople, is truly ironic and poses a serious threat to the existence and prospects of the Indonesia-China economic partnership. Therefore, the Indonesian government must take every piece of input seriously and exercise wisdom in making decisions with far-reaching implications—especially when it comes to the interests of a friendly nation like China, whose role and presence are vital in supporting Indonesia’s national interests.

Based on this phenomenon, the author seeks to propose the idea of equitable joint development—a concept of Indonesia-China synergy that is win-win in nature, rather than win-lose, which benefits only one party while harming the other. In fact, this idea was inspired by President Prabowo’s statement on November 9, 2024, during his working visit to China. At that time, in a joint statement with Chinese authorities, President Prabowo emphasized the need for Indonesia and China to engage in joint development in areas where the legal status is considered ambiguous due to overlapping claims of ownership and management rights (Afriansyah, 2024).

This refers to the potential for friction between Indonesia and China regarding China’s “nine-dash line” claim, which extends into Indonesia’s Exclusive Economic Zone (EEZ); Indonesia has since designated this maritime zone—which frequently sparks tensions—as the North Natuna Sea. On that occasion, Indonesia and China agreed to cooperate in the utilization of fisheries, oil, and gas resources in these waters, which hold great potential. In the author’s view, this idea is truly brilliant and ideally suited for application in other fields as well. The goal is to ensure that the development initiatives conceived and implemented by Indonesia and China proceed equitably, thereby paving the way to prosperity for both parties.

The question now is: How can we achieve equitable and impactful shared development that leads to sustainable prosperity? Broadly speaking, here is the author’s perspective.

Every development agenda is focused on eliminating poverty and inequality

The first pillar of the Sustainable Development Goals is “No Poverty” (Pristiandaru, 2023). This is particularly relevant when considered in the context of the Indonesia-China joint development agenda. Is this leading toward the achievement of this goal? According to data from BKPM (2026), the absorption and allocation of foreign and domestic investment funds remain concentrated in five provinces, namely: Jakarta with Rp78.7 trillion in investment (15.8%), West Java with Rp76.8 trillion (15.4%), Banten with Rp34.4 trillion (6.9%), East Java with Rp32.6 trillion (6.5%), and Central Sulawesi with Rp32.1 trillion (6.4%). This fact indicates that the distribution of economic growth in Indonesia is not yet proportionally balanced, as it is concentrated only in certain regions.

Ideally, investment funds from China should be allocated to stimulate economic sectors that can promote economic equality in new regions of Indonesia. If, in central Indonesia, Central Sulawesi is currently the only province among the top five in terms of investment turnover, as shown in the data above, then the hope is that other regions in western, central, and eastern Indonesia will also become investment magnets.

Ironically, neither the Riau Islands Province (Kepri) nor any other province in Kalimantan has emerged as a leading destination for investment. Yet provinces such as Kepri and those in Kalimantan are very close to the South China Sea and the North Natuna Sea—waters that, according to a joint political statement by Indonesian and Chinese authorities, are slated for joint development.

Every region in Indonesia has its own strengths and unique characteristics. The government’s major task is to identify and optimize these strengths so that they become a blessing for the nation’s welfare. The author suggests that the government should devise a strategy to make the Riau Islands Province a prime destination for investment. Assure investors that there are joint Indonesia-China development projects in the fisheries, oil, and gas sectors. If investment is distributed evenly, without disparities, the economy will grow evenly, thereby reducing poverty and income inequality among citizens.

Every development agenda must be oriented toward gender equality.

Ideal development is that which involves all parties and sectors without discriminating based on gender identity or social group. The facts show that the majority of formal-sector workers in Indonesia are still dominated by men. The latest data from the Central Statistics Agency (BPS) indicates that 45.88 percent of Indonesia’s formal workforce is male, compared to 36.66 percent female (BPS, 2026). With the Indonesia-China joint development commitment in place, it is hoped that more Indonesian women will become actively involved in national economic development activities so that they not only represent women in the professional world but also serve as concrete proof that Indonesian women are reliable and ready to play important roles in accordance with their respective expertise.

Every development initiative must be committed to not damaging nature and the environment.

The areas of joint development between Indonesia and China significantly overlap with nature and the environment. For example, nickel mining and other types of mineral mining carried out by Chinese entrepreneurs in Indonesia take place in open-pit land-based operations, such as the Morowali Industrial Park (IMIP) in Morowali Regency, Central Sulawesi Province, and the Indonesia Weda Bay International Park (IWIP) in Central Halmahera Regency, North Maluku Province (Affan, 2024). In these industrial complexes, many Chinese entrepreneurs and investors are involved in mining activities. Therefore, in the interest of sustainability, it is advisable that every mining activity be balanced with environmental restoration efforts.

Closing every unproductive mine, refraining from cutting down trees within concession areas, and not indiscriminately discharging the company’s industrial waste into the surrounding environment are essential steps in achieving shared, sustainability-oriented development goals. This aligns with the 2015–2030 Sustainable Development Goals (SDGs), several of whose pillars emphasize development that prioritizes the conservation of natural ecosystems and ecological sustainability (Pristiandaru, 2023). Specifically, the 12th pillar of the SDGs mandates responsible consumption and production practices, meaning that any economic growth targets pursued by companies must not neglect environmental and ecological considerations. Thus, all economically valuable activities—whether involving the creation of a product or the utilization of its output—must not pollute the surrounding environment.

In the 13th pillar, the SDGs explicitly address climate change. Therefore, it is the responsibility of all businesses—especially those whose operations directly impact air quality—to devise smart solutions for addressing pollution caused by their industrial processes in a balanced manner. Measures such as carbon offsetting through tree planting, reforestation, and the use of environmentally friendly energy sources like solar panels are concrete steps that Chinese companies in Indonesia can take.

In Goal 14, the SDGs specifically emphasize the importance of marine ecosystems. This means that joint development by Indonesia and China in the waters surrounding the North Natuna Sea and the South China Sea must take into account the sustainability of the ecosystems and marine life in those areas. Any fishing activities, oil and gas exploration, and the utilization and management of all marine resources at mutually agreed-upon locations must not result in excesses that could negatively impact the existence of marine resources and all the potential they hold.

In the 15th pillar, the SDGs explicitly call on nations around the world to care for terrestrial ecosystems. This means that no business or economic activity should pollute terrestrial biodiversity. Foreign investors collaborating with the Indonesian government are permitted to build factories and establish businesses on land; however, they must not, under the pretext of business and industrial development, clear natural habitats such as forests, cut down trees, excavate the earth without restraint, or pollute rivers at will.

Therefore, a good company is one that demonstrates a full commitment not only to maximizing profits but also to ensuring that every business decision it makes does not harm or endanger the surrounding environment. Striking a balance between business operations and the preservation of the environment, forests, and nature is absolutely essential. The frequent occurrence of natural disasters in Indonesia—such as landslides, flash floods, and unpredictable weather—is evidence of how nature responds to human behavior that tends to be harmful. For the sake of safety and sustainability, every Indonesian-Chinese business entity should be committed to implementing business practices that are friendly to nature and the environment.

Every policy must be made after hearing the views of all parties who will be affected

The sentiments expressed by a number of Chinese businesspeople in their letter to President Prabowo reflect their unease with the current business climate in Indonesia. They are concerned about government policies that tend to be one-sided, without involving them before making important decisions that affect many parties. They are also perplexed by certain parties who, in practice, tend to extort them by promising to resolve certain issues.

For example, it is only reasonable for Chinese businesspeople to object to Indonesian government policies that require them to deposit their business profits in Indonesian banks, increase business taxes many-fold, and allow thuggery to thrive in the areas surrounding their companies in Indonesia. Therefore, in the interest of fairness and the common good, the author believes it would be wise for the Indonesian government to first listen to the perspectives of those who will be affected by a policy before implementing it. Ask them and take note of their concerns!

It is important for the government to heed the voices of Chinese businesspeople as partners in national economic development. Listen carefully to their complaints, concerns, and objections. Seek their advice and recommendations—ideally, what would be the best approach? What would be the ideal scenario? This two-way model is not only beneficial for China but also for Indonesia as China’s host country and strategic partner. If this is heeded, the author is confident that Chinese entrepreneurs who have invested their wealth to build businesses in Indonesia will feel increasingly at home and fully committed to ensuring the continued success of Indonesia’s economic development.

Every business initiative and action must respect the integrity and sovereignty of partner countries.

Some time ago, Indonesia was rocked by the phenomenon of exclusive airports within the Indonesia Weda Bay Industrial Park (IWIP) integrated industrial complex in Central Halmahera Regency, North Maluku Province, and within the Indonesia Morowali Industrial Park (IMIP) integrated industrial complex in Morowali Regency, Central Sulawesi Province, where operational practices disregarded coordination with Indonesian authorities, giving the impression of a “state within a state.” This truly reflects a deeply regrettable precedent, to the extent that Defense Minister Sjafri Sjamduddin once conducted a surprise inspection at the IMIP airport in Morowali, Central Sulawesi, to ensure that the state was not being bypassed and to emphasize that all construction and operational standards must adhere to the regulations and procedures established by the government (Setiawan, 2025). How is it possible for an international-standard airport to operate within Indonesia’s sovereign territory, yet have no relevant officials present—such as customs, immigration, or security personnel?

It therefore makes sense for the Indonesian government to take decisive action by requiring IMIP and IWIP to comply with the standard procedures in effect in Indonesia. It was also entirely appropriate for Indonesian authorities to detain a Chinese national who was caught carrying five packages of mixed nickel powder and four packages of pure nickel powder undetected while attempting to fly from IWIP Airport to Manado, taking advantage of the lack of government security measures at IWIP Airport (Purnomo, 2025).

The Indonesian government’s decision to revoke the international airport status of IWIP and IMIP is also entirely appropriate. Foreign companies, with all their investment assets, are permitted and entitled to build supporting infrastructure in Indonesia. However, to ensure mutual benefit and prevent any party from being disadvantaged, it is essential to uphold the rule of law and the principle of national sovereignty. The author is convinced that no sane country would willingly allow its territorial sovereignty and laws to be violated by external parties.

Transparency and openness regarding profit-sharing from joint development activities

A fundamental aspect of any joint economic development activity is accountability and transparency regarding the business process and the final profits achieved. This includes the management of marine resources in the waters of the North Natuna Sea, which are considered to be in an overlapping area; therefore, to generate profits that can be shared by both parties, Indonesia and China have agreed to develop these resources jointly.

It has been over a year since that idea was proposed—how is it being implemented? Only the governments of Indonesia and China know the details of its progress. The author simply hopes, for the sake of shared prosperity, that if it is true the natural resources in the North Natuna Sea are being managed collaboratively, then the profits should be managed professionally and disclosed in a transparent, fair, and open manner. The people of both countries (Indonesia and China) have the right to know and to ask questions about the revenue sharing from the exploitation of fisheries, oil, and gas in these highly promising waters.

Every development agenda is always aimed at achieving peace, justice, and resilient institutions.

True economic development must have a vision of how every economic activity carried out allows planners, implementers, supervisors, and beneficiaries to experience comfort, tranquility, and harmony. They are not caught up in unproductive conflicts, because their focus is on the common good. Even if conflicts do arise, they are entitled to a resolution that is fair, impartial, and upholds the principles of justice. In the context of equitable joint development between Indonesia and China, this means that the Indonesian government must be committed to creating a business climate in Indonesia that makes Chinese investors and entrepreneurs feel at ease.

In practice, the government must not arbitrarily enact policies that unsettle Chinese businesspeople. Every decision affecting the economic well-being of Chinese investors should be fair and accepted by both parties with an open mind. In the author’s view, incidents such as the government policy requiring Chinese companies to hold their business profits in state-owned Himbara banks for one year should not be repeated. Such a policy would significantly disrupt Chinese businesses and could potentially undermine the prospects for Indonesia-China business relations.

The Indonesian government needs to recognize that the profits earned by Chinese businesspeople from their business activities in Indonesia belong entirely to them. It is also their right to decide how to handle those funds. If they do not wish to keep them in Indonesia, do not force them to do so. Furthermore, any issues arising from Indonesia-China economic activities must be addressed by institutions that are truly service-oriented and focused on resolving problems—not the opposite, exploiting these issues for personal gain. The complaints voiced by Chinese businesspeople in their letter to President Prabowo must be addressed with decisive action, demonstrating that the Indonesian government is truly committed to eradicating any bureaucratic practices that hinder business operators.

The Need to Strengthen Indonesia-China Social, Educational, and Cultural Ties

In supporting economic cooperation through a commitment to joint development, it is important to balance this with the strengthening of Indonesia-China social, educational, and cultural ties. In the author’s analysis, this is crucial because, ultimately, it is the people of both nations who will carry out and benefit from economic development. Therefore, the tangible manifestation of this idea is the implementation of large-scale, regular programs such as student and university exchange programs, cultural festivals—particularly during major holidays in both countries—and the provision of educational scholarships for students from each nation to study at the best universities in Indonesia and China.

By holding the status of international students, this is the best way for Indonesian and Chinese students to learn and absorb as much knowledge as possible at their host universities and to experience firsthand the real socio-cultural conditions of the host country. Currently, the Chinese government offers many scholarships to Indonesian students who wish to pursue their studies in the Land of the Bamboo Curtain. Hopefully, this number will continue to increase. To ensure balance, the Indonesian government should also offer similar opportunities to Chinese students. The author is optimistic that such steps will be highly effective in strengthening bilateral relations between Indonesia and China, particularly among the educated and the younger generation, thereby opening up new opportunities for Indonesia-China partnerships in the future. The more people from Indonesia and China who receive a quality education, the greater the opportunity for both countries to realize a shared development agenda based on equity.

This is the result of the author’s analysis of Indonesia-China joint development. The author sincerely hopes that these ideas will serve as input for the realization of successful Indonesia-China joint development that brings sustainable prosperity to both countries. Here’s hoping!

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