Nigeria is set to benefit from a new wave of trade and investment agreements with Indonesia, as both nations seek to expand their economic ties amid shifting global trade dynamics. With deals valued at $3.5 billion expected to be signed at the ongoing Indonesia-Africa Forum in Bali, this marks a significant increase from the $600 million in agreements reached during the forum’s first edition in 2018.
Thank you for reading this post, don't forget to subscribe!According to Nigeria’s Trade Minister, the new partnerships highlight Indonesia’s growing interest in African markets, particularly in resource-rich countries like Nigeria. The deals are part of Indonesia’s broader strategy to diversify its trade relations beyond its traditional partners like China, the United States, and Japan, as the global economy faces new challenges, including the economic slowdown in China, fluctuating commodity prices, and rising protectionism.
Among the key agreements, Indonesia’s state-owned utility company, PT Perusahaan Listrik Negara, will collaborate with Tanzania Electric Supply Co. Ltd. on geothermal energy projects. PT Bio Farma has also secured a deal with Ghana’s Atlantic Lifesciences Ltd. for health technology transfer, while Congo and Senegal are in talks to purchase and maintain aircraft from PT Dirgantara Indonesia. Additionally, PT Pertamina, Indonesia’s state oil and gas company, is exploring a partnership with Guma Group Ltd. to build a power plant in South Africa, using gas supplied from Mozambique.
For Nigeria, these developments present an opportunity to strengthen its economic ties with Indonesia, particularly in sectors like energy and health. The Nigerian government is optimistic that the agreements will open up new avenues for investment and trade, providing a boost to the nation’s economy as it seeks to diversify its own export markets and reduce dependency on traditional trading partners.
Africa, including Nigeria, is becoming increasingly important to Indonesia’s economic ambitions, especially as the Southeast Asian nation aims to position itself as a global hub for battery production. Indonesia, which boasts vast nickel reserves, is looking to Africa for other critical minerals needed for battery manufacturing, such as cobalt and graphite. President Joko Widodo recently announced that Indonesia is finalizing a partnership with Zimbabwe for lithium mining, a move that could have implications for similar collaborations with Nigeria in the future.
As global trade tensions continue to disrupt supply chains, particularly in the electric vehicle sector, Nigeria and Indonesia see an opportunity to collaborate more closely. By strengthening their economic ties, both nations aim to create a more resilient and diversified global supply chain, turning potential challenges into mutual opportunities.
“This is a crucial time for Nigeria and other African countries to engage more deeply with Indonesia and other partners in the Global South,” said Nigeria’s Trade Minister. “Rather than viewing each other as competitors, we should be working together to create new opportunities for growth and development.”
