Qatar investment agency to set up $1b joint venture

The Jakarta Post, Jakarta

The Indonesian government and Qatar's Investment Authority (QAI) have agreed to establish a joint venture to finance a number of infrastructure projects in Indonesia.

QAI will own 85 percent stake of the joint venture, which will have initial capital of about US$1 billion. The Indonesian government, through the Finance Ministry, will own the remaining 15 percent.

"The joint venture will participate in a number of infrastructure, property and electricity projects," Vice President Jusuf Kalla said told reporters after the signing of the agreement on the establishment of the joint venture in Jakarta on Thursday.

The Gulf state's $50 billion sovereign wealth fund is trying to boost its assets in Asia to counter a weak dollar and capture higher returns.

Qatar, a member of the Organization of Petroleum Exporting Countries, owns the world's biggest gas field, and channels surpluses from energy sales to the QIA.

"Our partnership with the Government of Indonesia allows us together to invest for the long term in Indonesia's attractive economy," QIA executive board member Hussain Al Abdulla said in a statement. "This joint venture represents a natural extension of our strategy to increasingly focus investments in Asia."

Meanwhile, the government's special envoy to the Middle East, Alwi Shihab, said that Emaar, an investment company based in the United Arab Emirates, was tentatively scheduled to sign a similar agreement with the government's asset management company, PT Perusahaan Pengelola Aset (PPA).

However, the agreement, which would allow them to develop a US$600 million tourist resort in Lombok, could not be signed immediately as the asset management company was soon to be wound up, he said.

"We hope we can sign the agreement within the next few weeks after the establishment of a new agency to replace PPA ," Shihab was quoted as saying by Bisnis Indonesia.