Indonesia can emerge as Korea’s energy, minerals hedge: commerce chamber head

Seoul, South Korea – Indonesia and South Korea are poised to deepen economic ties, with a focus on energy security and critical mineral cooperation, according to Anindya Novyan Bakrie, chairman of the Indonesian Chamber of Commerce and Industry. The recent summit between Indonesian President Prabowo Subianto and South Korean President Lee Jae Myung underscored the need for long-term industrial partnerships beyond ad hoc deals.

Korea-Indonesia Partnership: A Strategic Hedge

Bakrie, who accompanied President Subianto on his visit to Seoul last week, emphasized the potential for the relationship to serve as a strategic hedge for South Korea’s energy and critical minerals security amid increasing geopolitical risks and energy market volatility.

He noted the summit agenda is “practical,” covering areas such as trade, investment, defense, artificial intelligence, infrastructure, shipbuilding, nuclear energy, and the energy transition, providing the private sector with a clearer direction for partnership.

Energy Cooperation as a Priority

With concerns rising over Middle East energy supplies, Bakrie highlighted gas and broader upstream energy cooperation as a crucial area for South Korea’s supply security. He specifically cited Indonesia’s offshore Binaiya and Serpang blocks, estimated to contain 15 trillion cubic feet of gas, where a consortium led by SK Earthon has been granted exploration rights, as a model for future projects.

However, he stressed the strategic value extends beyond hydrocarbons to include critical minerals and intermediate materials. “The right model is not spot buying, but a long-term partnership: upstream cooperation, processing, logistics and a cleaner downstream industry,” Bakrie stated.

Building on Existing Foundations

The summit represents a continuation of a deepening relationship, building on existing economic ties and ongoing discussions. Ministerial and working-level talks have been underway since the presidents’ meeting at the Asia-Pacific Economic Cooperation meetings in Korea last October to expand investment and address business concerns.

“The biggest synergy is clear enough: Korea brings technology, industrial discipline and capital; Indonesia brings scale, resources and a strong downstreaming agenda,” Bakrie said. He believes the summit can help remove obstacles to growth in sectors like electric vehicles, batteries, steel, petrochemicals, clean energy, and the digital industry.

Execution and the IK-CEPA

Despite bilateral trade exceeding $20 billion and a significant presence of Korean firms in Indonesia, Bakrie stressed the importance of execution and maximizing the benefits of the Indonesia-Korea Comprehensive Economic Partnership Agreement (IK-CEPA). He called for faster approval of cooperation proposals, noting that only two out of 25 proposals under IK-CEPA had been approved as of 2026.

Bakrie urged a shift towards a “balanced and more industrial” trade structure, focusing on co-production in refining, components, engineering, manufacturing, and services. He also highlighted the role of artificial intelligence in enabling this transformation.

“Korea brings serious strength in semiconductors, digital infrastructure and factory automation; Indonesia brings scale, demand, and a large set of real-economy use cases,” he said. “Korea’s technological strength can work with that scale to create a new growth engine. Indonesia should be one of the main platforms for that cooperation.”