South Korean Companies Pledge $1.78 Billion in New Investment Commitments in Indonesia

JAKARTA, Investortrust.id – President Prabowo Subianto has secured a major investment commitment from South Korean companies, less than a month after an LG consortium withdrew from a high-profile electric vehicle battery project in Indonesia. The move underscores Jakarta’s efforts to maintain strong investor confidence, attracting new and expanded investments across diverse sectors.

During an official meeting with business leaders at Merdeka Palace in Jakarta on Monday, April 28, 2025, President Prabowo welcomed executives from 19 leading corporate groups, represented by the Federation of Korean Industries, or FKI.

The delegation reported that existing investments from South Korean companies in Indonesia have reached US$15.4 billion, equivalent to approximately Rp 269 trillion in the past few years. They also pledged an additional US$1.78 billion, or around Rp 30 trillion, pushing the total to roughly Rp 300 trillion.

South Korea was Indonesia’s seventh-largest source of foreign direct investment in 2024, contributing around 5 percent of total inflows, according to data from the Investment Coordinating Agency (BKPM).

Coordinating Minister for Economic Affairs Airlangga Hartarto, who accompanied President Prabowo during the meeting, highlighted the significance of the commitment during a press conference.

"The investments by these 19 corporate groups have reached nearly US$15.4 billion, with an additional US$1.7 billion planned. In rupiah terms, this amounts to Rp 269 trillion, plus another Rp 30 trillion in forthcoming investments," Airlangga stated at the Presidential Palace in Jakarta.

One of the largest contributors is Lotte Chemicals, currently building what will become Indonesia’s largest petrochemical plant. The facility is scheduled for inauguration between September and October 2025. President Prabowo has also instructed Indonesia’s sovereign wealth fund, Danantara, to study and pursue participation in the project.

The meeting’s timing is critical. It came shortly after a consortium consisted of LG Energy Solution, LG Chem, and LX International Corp decided to withdraw from its planned electric vehicle battery project in Indonesia—a setback that had raised concerns about the investment climate. The successful gathering with FKI, therefore, sent a strong signal that Indonesia remains a competitive and attractive destination for major South Korean investors.

Beyond Lotte Chemicals, several other South Korean corporations reported on their investment progress. KB Financial Group announced that PT Bank Bukopin Tbk had returned to profitability after four years. Hyundai Motor reported smooth operations, while POSCO confirmed that its collaboration with Krakatau Steel had advanced into a second phase aimed at boosting steel output to 10 million tons annually.

Airlangga also cited EcoPro’s US$500 million investment in Morowali for cathode precursor and nickel smelter production, supporting the electric vehicle supply chain. Meanwhile, KCC Glass, which operates in the Batang Industrial Zone, plans to expand its operations, contingent on government support for competitively priced domestic gas supplies.

“KCC Glass informed President Prabowo of their expansion plans, requesting government support to ensure competitive gas pricing, which had already been discussed with the President,” Airlangga said.

Other notable developments include LX International’s US$500 million investment commitment in coal, nickel, and plantation sectors, as well as SK Group's construction of a plasma facility in Cikarang to enhance Indonesia’s medical sector. In the defense sector, new investment was also pledged for domestic ammunition manufacturing.

South Korean executives praised the Indonesian government’s openness and responsiveness to investor input during the discussions.

"They appreciated the transparent dialogue with President Prabowo, who listened carefully to each company's proposals. This level of openness left a strong impression on the delegation," Airlangga added.