Australia's biggest state, New South Wales, and Indonesia's special capital province, DKI Jakarta, sign a new edition of their often disrupted sister-region MOU

By Geoffrey Gold

THE GOVERNMENT of the Australian state of New South Wales (NSW) has confirmed the renewal of its sister-region Memorandum of Understanding (MOU) with Indonesia’s Special Capital City province of Daerah Khusus Ibukota Jakarta (DKI Jakarta).

According to the announcement the MOU focuses on “four key areas across agribusiness, food and beverage, technology, innovation and startups, tourism and education to increase collaboration to generate commercial outcomes for NSW and Indonesian businesses”.

A focus of the agreement is to help increase links in tourism and education with 55% of Indonesian students currently studying in Australia choosing to study in NSW.

DKI Jakarta’s Caretaker Governor, Heru Budi Hartono, welcomed the renewal which had been negotiated with his predecessor, former Governor Anies Baswedan, over the past two years: “Jakarta is continuously progressing to be a smarter city and better living environment for its residents. We hope the cooperation built with NSW can help to improve our resilience against future challenges, including climate change and healthcare. Furthermore, this relationship can be a platform for mutual learning and benefit in the effort to develop our city or state.”

NSW Minister for Enterprise, Investment and Trade Alister Henskens emphasised the timeliness of the new agreement: “Indonesia boasts an economy growing at 5% per annum that has already passed US$ 1 trillion and by 2030, Indonesia is projected to be the seventh largest economy in the world. There are many exciting opportunities for NSW businesses to expand into Indonesia and Jakarta is home to a growing consumer market eager for high-quality food and health products, growing infrastructure needs and a thriving technology sector.

NSW’s oldest connected organisation, the Australia Indonesia Association of NSW founded in 1945, congratulated both administrations: “We look forward to working with the NSW and DKI Jakarta governments to ensure the key objectives of the MOU are implemented. AIA believes this MOU will develop the relationship between the people of our states closer in the future on both commercial and cultural levels,” its President Patrick Hanna told the Indonesia Australia Report.

The business community concurs. "The Australia Indonesia Business Council is extremely pleased to see the MOU signed between NSW and DKI Jakarta and see it as strategically significant," Di Robinson, Chair of the AIBC's NSW Chapter explained to the Indonesia Australia Report. "We welcome stronger relationships between NSW and Jakarta and see many opportunities for growth on both sides. It is a significant step forward."

According to NSW Minister Henskens, the updated MoU strengthens the already “28-year Sister State-Province agreement NSW has with Jakarta”. But it has not all been smooth sailing.

The first edition of the MOU was signed on 30 May 1994 during the euphoria of Australian Prime Minister Paul Keating’s month-long ‘Australia Today Indonesia 1994’ program of sports, cultural displays and education seminars and the ‘Expanding Horizons’ trade and investment conference and exhibition in Indonesia.

Unfortunately, the NSW-Jakarta collaboration ended abruptly in mid-2007 during an official tour of Sydney, at the NSW state government's invitation, by then Jakarta Governor Sutiyoso. While he was otherwise engaged, NSW police “let themselves into” the Governor’s Sydney hotel room “to seek his appearance at the Balibo inquest into the deaths of five Australian newsmen in East Timor in 1975”. 

Jakarta Governor Sutiyoso (2007)

Mr Sutiyoso departed Australia immediately and, while he later accepted a letter of apology from the office of then Labor Premier, Morris Iemma and did politely receive a personal peace-making mission to Jakarta by NSW state Governor, Professor Marie Bashir AC CVO, DKI Jakarta did not pursue further initiatives with NSW and Indonesia seemed to fall completely below the NSW radar.

The frostiness began to melt in April 2013 with the release of a new NSW International Engagement Strategy which identified Indonesia as a priority market with “considerable opportunity to further develop our economic relationship based on the proximity and complementarities of our economies.” The report also recommended the opening of a NSW trade and investment office in Indonesia.

By October 2013, then NSW Deputy Premier and Minister for Trade and Investment Andrew Stoner led a five-day trade and investment mission to three Southeast Asian countries and notably mentioned he was the “first NSW Government leader from the current administration” to visit Indonesia where he would go on to meet with Indonesian government leaders, including the Vice Minister of Trade, and senior business leaders.

The 2015 MOU signing by Minister for Trade, Tourism and Major Events Stuart Ayres and Djarot Saiful Hidayat, Vice Governor of Jakarta

The second edition of the agreement was thus signed in October 2015 by then NSW Minister for Trade, Tourism and Major Events Stuart Ayres and Djarot Saiful Hidayat, Vice Governor of DKI Jakarta, with the aim to grow trade in areas of agriculture, education, technology and infrastructure services. The two governments also agreed to focus on “mutually beneficial cooperation” in:

  1. Infrastructure - urban sustainability and transport connectivity for smart cities': to exchange knowledge and share experience in city planning, smart infrastructure delivery and environmental engineering:
  2. Education and training: to link training providers to support skills development vital to Jakarta's needs;
  3. Trade and economic development to assist industry cooperation in food safety and security: and logistics for agribusiness;
  4. Public servants', to share international experience in the areas of management finance, public administration, e-procurement and one-stop customer services: and
  5. Zoological Parks: to support the cooperation between Taronga Zoo and Taman Margasatwa Ragunan in the areas of exchange of animals and training for animal keepers and managerial staff.

For the first time, NSW Trade and Investment established a presence in Jakarta with the 2015 appointment of local marketing staff within the Austrade Trade Commission’s offices at the Australian Embassy. But it was not until October 2020 that a “NSW Trade and Investment Director" for Jakarta was advertised widely.


An Indonesia Australia Report news Tweet and link

Mr Yonathan Wijaya took up his role as NSW Trade and Investment Director, Indonesia, also co-located with the Australian Trade Commission, in November 2021.  With prior private sector experience, he moved to the NSW position after four years at the UK Embassy to Indonesia as a trade and investment specialist including Head of Private Sector Engagement.

Mr Wijaya described the new NSW-Jakarta MOU as “a renewed spirit for Jakarta and Indonesia” and said he was “looking forward to the implementation tapping into the opportunities in both economic centres.”

Andrew Parker, Senior Trade & Investment Commissioner, ASEAN at Investment NSW, also commented: “For those of use fortunate enough to have been involved in B20 Indonesia this week, we saw up close a country that is growing in confidence and most assuredly on the move. NSW has a lot to offer as Indonesia sets about achieving its economic goals and … Investment NSW will be working with Pemerintah Provinsi DKI Jakarta to develop some specific activities under the MOU. We will also be engaging with businesses to gather implementation ideas and explain how NSW businesses can benefit from the MOU.”


See also:

NSW Trade and Investment Directer Jakarta (16 October 2020)

The 1994 integrated Australian business-cultural promotion in Indonesia and Paul Keating's call for a closer relationship (18 September 2013)

Australia's regions accelerate trade missions to Indonesia and official offices (13 August 2013)