Update COVID-19 in Indonesia: 70,736 confirmed infections, 3,417 deaths (9 July 2020)
6 July 2020 (closed)
USD/IDR (14,501) +55.01 +0.38%
EUR/IDR (16,343) -41.31 -0.25%
Jakarta Composite Index (5,052.79) -23.38 -0.46%
At the start of the week, Japan sold its 58.88 percent stake in Indonesia Asahan Aluminium (Inalum) to the Indonesian government for a price of USD $556.7 million. At a ceremony held in Jakarta, witnessed by various Indonesian ministers and Japanese government officials, the agreement was signed. Talks about the sale of Japan's stake were difficult and lengthy, almost needing resolution by arbitration, due to disagreement about he value of Japan's stake. This then triggered concerns that Indonesia-Japan relations were in jeopardy.
Based on an agreement, signed in 1975, Japan had to sell its stake in Inalum to the Indonesian government by October 2013.
In 1975, the partnership between Indonesia and Japan started. Nippon Asahan, a consortium of 12 Japanese firms, and the Indonesian government planned to build hydroelectric plants with an aluminium smelter. Inalum is currently Southeast Asia's largest aluminimum smelter with an annual aluminium production capacity of 225,000 tons, of which 60 percent is exported to Japan, while the remaining 40 percent is used for Indonesia's domestic market.
The government of Indonesia allocated IDR 2 trillion from the 2012 State Budget and IDR 5 trillion from the 2013 State Budget to finance the take-over. It aims to boost Inalum's aluminium production to 470 tons per year by 2017.