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China, Indonesia sign deal to boost cooperation

By ZHAO SHENGNAN in Beijing and DENG YANZI in Jakarta (chinadaily.com.cn) Updated: 2015-03-27 12:40

China and Indonesia issued a joint declaration on deepening ties and signed eight agreements in Beijing on Thursday, including building infrastructure in the Southeast Asian nation.

A memorandum of understanding on greater cooperation in infrastructure and industry was signed, and another on building a high-speed railway linking the Indonesian capital of Jakarta and Bandung, about 180 km southeast of Jakarta.

Others include maritime searches, taxation, airspace and cooperation between Chinese and Indonesian enterprises.

President Xi Jinping told his Indonesian counterpart Joko Widodo before they witnessed the signings that China is willing to use the Asian Infrastructure Investment Bank and Silk Road Fund to facilitate Indonesia's development of ports, high-speed railways, airports, shipbuilding and special economic zones in coastal areas.

China initiated the bank, which includes Indonesia as a member, after Xi proposed transcontinental plans in 2013 to revive the Silk Road trading routes, networks connecting China with Europe through a host of Asian economies.

Widodo, making his first state visit to China since taking office in October, said Indonesia welcomes Chinese State-owned and private enterprises to its infrastructure sector and their role in developing special economic zones.

He called for both countries to expand currency swaps and increase the volume of two-way trade to $150 billion in 2020.

China is the top trading partner of Indonesia but trade volume of $63.58 billion in 2014 was down 7 percent on the previous year.

Widodo, who has identified improving Indonesia's dilapidated infrastructure as a priority, started a two-nation trip to Japan and China on Sunday, seeking fresh investment from Asia's two biggest economies.

Kiki Verico, head of International Trade Research at University of Indonesia, hailed the role of the AIIB, noting poor infrastructure is the number one challenge Indonesia needs to address to achieve more growth.

"Having China in Southeast Asia helps to foster and push economic growth through investment and trade, not only for Indonesia, but also for Southeast Asia," he said.

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