Germany and Indonesia deepen trade and clean energy partnership

Jakarta (ANTARA) - The German and Indonesian governments strengthened their partnership in trade, investment and sustainable energy transition during the visit of the President of the Federal Republic of Germany, Frank-Walter Steinmeier, to Jakarta on Monday (6/15).

"There are important reasons why I am here again today," Steinmeier said in a statement quoted by the German Embassy in Jakarta, here on Tuesday (6/16).

The president said a trustworthy partnership between the two countries was crucial, amidst a world that seemed to be drifting apart, while mistrust, power politics and violence were on the rise in many places.

Amidst this situation, he said he was pleased that both parties could agree to strengthen the partnership, not only at the political level, but also in the fields of economic cooperation, skilled labor development, climate action, science, and culture.

Meanwhile, German Ambassador to Indonesia Ralf Beste stated that the strengthening of relations is taking place amidst rapid changes in the global order. With the Indonesia-European Union Comprehensive Economic Partnership Agreement (I-EU CEPA), he predicted an increase in bilateral trade, exports, and investment flows between Germany and Indonesia.

"The latest global price shock for oil and gas also shows that we need a transition to renewable energy not only to protect the climate, but also to enhance energy security," he said.

The Just Energy Transition Partnership (JETP), which is jointly led by the two countries, he said, also contributed to strengthening relations between Germany and Indonesia.

Two financial agreements were recently signed between Indonesia and several German institutions.

These agreements aim to improve conditions for increased trade and investment and accelerate the equitable transition to renewable energy.

The first agreement focuses on improving economic growth and investment with a value of 400 million euros.

The agreement was signed by the German Development Bank KfW and the Indonesian Ministry of Finance, under the Competitiveness, Investment, and Trade Acceleration (CITA) Program.

The program is designed to support Indonesia's economic reform agenda to achieve sustainable and inclusive economic development, in accordance with international trade and investment standards.

The second agreement, worth US$302 million, supports the development of renewable energy projects and electricity-grid infrastructure.

The agreement was signed by KfW and PT PLN (Persero), under the Accelerating Indonesia's Clean Energy Transition Program.

The program is designed to accelerate Indonesia's energy transition by encouraging the integration of renewable energy development through improvements to electricity grid infrastructure and the expansion of solar and wind power. In addition, the program also ensures the implementation of environmental guarantees and a just transition for all stakeholders.

The program is Germany and Indonesia's contribution to the Just Energy Transition Partnership (JETP), in which Germany has taken over the co-chairmanship of the International Partners Group (IPG) with Japan, since early 2025. Germany, according to the statement, has committed to allocating around 1 billion euros for development cooperation by 2026.

In February 2026, two other financial agreements were approved and witnessed by Coordinating Minister for Economic Affairs Airlangga Hartarto, and Christine Toetzke, Director General for Asia, Southeastern and Eastern Europe, the Middle East, and Latin America of the German Federal Ministry for Economic Cooperation and Development (BMZ).

The agreement relates to the Green Energy Corridors Sulawesi (GECS) and Green Bond Development Facility (GBDF) projects with a total value of 308 million euros.

The Green Energy Corridors Sulawesi (GECS) project will construct a 275kV transmission line across South Sulawesi to unlock the region's vast renewable energy potential.

Meanwhile, the Green Bond Development Facility (GBDF) strengthens Indonesia's green bond market to attract sustainable investment. These initiatives mark a significant milestone in the implementation of JETP, translating partnership commitments into concrete actions and measurable progress toward realizing a clean energy future in Indonesia.

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Translator: Katriana

Editor: M Razi Rahman

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