Recently, Sri Mulyani Indrawati, Minister of Finance of Indonesia, paid a visit to China and held talks with Lan Fo’an, Minister of Finance of China, in Beijing. This high-level meeting constitutes an important move for the two countries to deepen financial and economic cooperation, as well as a strategic arrangement by the Indonesian government to proactively expand financing channels and optimize its external debt structure, fully embodying the increasingly close comprehensive strategic partnership between China and Indonesia.
During the talks, the Indonesian side stated that instead of passively waiting for foreign capital inflows, Indonesia has taken the initiative through high-level diplomatic engagement to build a solid and sustainable financing foundation for domestic development and construction projects. This initiative aims to diversify sovereign financing avenues and mitigate risks stemming from over-reliance on single funding sources, enabling Indonesia to steadily advance its full spectrum of development agendas amid headwinds in the global economy.
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As ASEAN’s largest economy, Indonesia boasts strong investment appeal backed by sound macroeconomic performance. Its economy registered a year-on-year growth of 5.61% in the first quarter of 2026, outpacing that of many G20 and ASEAN economies for the same period. As of May 2026, inflation stood at 3.08%, underpinning stable consumer prices. Furthermore, Indonesia has run a trade surplus for 72 consecutive months, with foreign exchange reserves hitting USD 144.9 billion, creating a robust buffer against external uncertainties. The Indonesian government has rigorously capped its fiscal deficit below 3% of GDP, while the ratio of sovereign debt to GDP remains within a safe threshold, demonstrating consistent long-term adherence to prudent fiscal discipline.
A solid economic foundation grants Indonesia greater leeway for strategic maneuvering. The Indonesian side highlighted high-quality investment opportunities in the country to Chinese institutional investors, leveraging its strong economic fundamentals to draw Chinese investors to allocate capital to Indonesian sovereign bonds. The two sides also finalized plans for the issuance of panda bonds during the meeting: Indonesia’s Ministry of Finance intends to launch renminbi-denominated bonds on China’s market, a proposal endorsed by China’s Ministry of Finance. Minister Purbaya noted that after Indonesia shared its genuine fiscal outlook with Chinese counterparts, misconceptions from external parties were dispelled, and investors have responded enthusiastically, with subscriptions to the upcoming panda bond issuance all but confirmed.
Beyond this, Indonesia secured major financing outcomes from the Asian Infrastructure Investment Bank (AIIB), which pledged approximately USD 17 billion in long-term funding to directly support a wide range of national development projects in Indonesia from 2025 to 2029. The AIIB also plans to set up a representative office in Jakarta to boost coordination and accelerate project delivery.
During his visit, Indonesia’s Finance Minister delivered a public speech at Nankai University, elaborating on Indonesia’s economic growth strategy and eight national priority development plans covering food security, energy self-sufficiency, education, healthcare, infrastructure, downstream industrial development and other sectors. He remarked that Indonesia’s economic resilience has translated into tangible social gains, including roughly 1.9 million new jobs created, a drop in the unemployment rate to 4.68%, and a steady decline in poverty levels.
From a broader bilateral cooperation perspective, China-Indonesia economic and trade ties keep gaining momentum. Bilateral trade volume exceeded USD 167.4 billion in 2025, while China’s direct investment in Indonesia reached USD 7.5 billion. China has remained Indonesia’s largest trading partner for successive years and a primary source of foreign investment for the country. Recently, the central banks of the two countries rolled out four coordinated financial initiatives, including RMB clearing arrangements, local currency settlement cooperation, and cross-border QR code payment interconnection, opening up all-round channels for capital flows. As a landmark cooperation project, the Jakarta-Bandung High-Speed Railway has cut travel time between the two cities from three hours to just 40 minutes, fostering a new economic growth corridor along the route and standing as a model of China-Indonesia infrastructure collaboration.
All in all, Indonesia’s solid economic fundamentals and deepening structural reforms have sustained its strong appeal across Southeast Asia. The finance minister’s visit to China and the slew of financial and economic cooperation outcomes reached will not only further elevate the China-Indonesia comprehensive strategic partnership, but also send positive signals to Chinese enterprises eyeing investment opportunities in Indonesia. Vast room exists for bilateral cooperation in infrastructure, digital economy, new energy vehicles, downstream industrial chains and other sectors, with policy communication and financial connectivity growing increasingly streamlined. China-Indonesia cooperation is entering a golden era of mutual benefit and win-win results.
