DP World, Caisse de dépôt et placement du Québec (CDPQ) and Maspion Group have inked a $1.2bn deal that will see an international container port and industrial logistics park take shape in the Gresik region of East Java.
Works on the projects are expected to begin in Q3 of 2021 and once complete, it is expected to enhance East Java’s position as a key trade gateway for Indonesia.
According to a statement from DP World, it will set up a joint venture company along with CDPQ’s global investment platform and Maspion Group for the project. This is said to be the first time a foreign direct investor (FDI) partner and a private sector Indonesian company have partnered in the Indonesian transportation sector.
DP World group chairman and CEO Sultan Ahmed Bin Sulayem and Maspion chairman and CEO Dr Alim Markus signed the agreement in Jakarta, at the Indonesia-Emirates Amazing Week 2021 Building Path Towards Economic Recovery business forum. They deal was witnessed by the Co-ordinating Minister for Maritime and Investment Affairs of Indonesia Luhut Binsar Pandjaitan and the UAE Minister of Energy and Infrastructure Suhail Al Mazrouei.
Once complete, DP World Maspion East Java will become the sole operator of the international container port. It will be designed to handle up to three million 20-foot equivalent units (TEUs).
DP World and CDPQ will also work with Maspion Group to develop an integrated industrial and logistics park adjacent to the container terminal, with an initial land area of 110 hectares, with scope for future expansion.
The park will provide world-class trade environment for domestic and international businesses to help drive economic growth and create jobs, said the statement from DP World.
The investment will allow the partnership to pursue its objectives to further diversify its reach in terms of geography and trade lanes, the statement noted.
Bin Sulayem explained, “The partnership with Maspion Group is an important development in our global ports and logistics network. Indonesia is rapidly developing as one of the world’s most important economies. This project will create modern, efficient infrastructure, as well as an industrial zone that provides quality logistics. DP World’s business model and vision are aligned with President Jokowi’s vision to spur faster economic growth through trade infrastructure development, more investment opportunities, and job creation.”
CDPQ executive VP and head of Infrastructure Emmanuel Jaclot remarked, “Through this partnership with Maspion, CDPQ is delighted to make its first infrastructure investment in Indonesia, a strong growth market which benefits from favourable structural trends. It also represents an important milestone for our joint platform with DP World with the addition of a first greenfield port to our portfolio of high-quality assets that have demonstrated their resilience over the past year despite important shifts in the global supply chain landscape.”
Dr Markus said Maspion was committed to support Indonesia’s sustainable economic development to be aligned with President Jokowi’s grand plan to make Indonesia the fifth largest economy in the world.
“Surabaya is an important gateway in Indonesia and the existence of this Container Port will further enhance economic development and investment opportunities in Indonesia,” concluded Dr Markus.