President Donald Trump met with Indonesian Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan on Tuesday, a meeting that the White House did not include on the president’s public schedule and did not provide comments on.
White House advisers Ivanka Trump and Jared Kushner, along with Adam Boehler, chief executive officer of the U.S. International Development Finance Corp. (DFC), were also present, according to a readout and photographs of the meeting provided by the Indonesian government.
“On behalf of President Joko Widodo, I expressed gratitude and appreciation to President Donald Trump,” said Pandjaitan, who is often referred to as Indonesia’s “Minister of Everything” because of his extensive portfolio and political clout. “Whatever the official result of the U.S. election, friendship must be maintained. We will always be friends. I hope that this good communication with the White House can also be fostered after January 2021.”
Pandjaitan said he and Trump discussed “increased economic cooperation” between the two countries, especially after Washington extended Indonesia’s Generalized System of Preferences, a preferential trade status, earlier this month. On Wednesday, Indonesia signed a $750 million infrastructure financing memorandum of understanding with the U.S. government’s Export-Import Bank.
Vaccine production
In separate events, Pandjaitan met with Vice President Mike Pence, who, according to the Indonesian government, offered “joint cooperation in vaccine production between American and Indonesian companies,” and with national security adviser Robert O’ Brien to discuss a “strategic partnership” in defense and technology.
The White House declined to provide comment on VOA’s query about the meeting. It remains unclear what has been offered in terms of vaccine production cooperation.
Last month Pandjaitan led a delegation to Yunnan, China, to sign deals with Sinovac Biotech Ltd., Cansino and Sinopharm, Chinese pharmaceutical companies conducting late-stage vaccine trials in several countries, including Indonesia.
With the highest number of coronavirus infections and deaths in Southeast Asia, Indonesia aims to start a mass vaccination campaign by the end of 2020 using mostly Chinese vaccines. Jakarta said it would procure 18 million doses of Chinese vaccine by the end of the year.
Two American companies, Pfizer and Moderna, have recently reported that their coronavirus vaccines are more than 90% effective and have no serious side effects.
Indonesian sovereign wealth fund
Pandjaitan is in the U.S. to pitch Indonesia’s soon-to-be-established sovereign wealth fund aimed at financing infrastructure projects across the archipelago. The fund seeks to attract up to $15 billion in investments to stimulate economic growth following models adopted by other developing countries. He is also promoting the fund in meetings with the World Bank and the International Monetary Fund in Washington this week.
The unannounced meeting drew scrutiny from Asia analysts, especially because it comes at a time when Trump has had few publicly announced meetings as he and his presidential campaign pursue lawsuits alleging ballot fraud in the 2020 vote.
“It is pretty extraordinary that at a time when the U.S. president is receiving few visitors that Luhut Pandjaitan would be received in the Oval Office,” said Aaron Connelly, a research fellow on Southeast Asian foreign policy at the International Institute for Strategic Studies.
DFC’s Boehler, a former college roommate of Kushner, met with Pandjaitan in Jakarta last month to further discuss investment opportunities in the country’s sovereign wealth fund, following an initial meeting in January with Widodo.
“The new U.S. International Development Finance Corporation will play a critical role in supporting Indonesia, particularly by developing quality infrastructure that establishes a strong foundation for the country’s next stage of growth,” Boehler said after the January meeting. The DFC partners with the U.S. private sector to finance development projects in lower- and middle-income countries and has been billed as an alternative to China’s Belt and Road Initiative development financing mechanism.
However, even if DFC eventually gives its seal of approval, it is unclear whether American investors would have confidence in a sovereign wealth fund launched by a government besieged by high levels of corruption and debt burden.
Investment opportunities
Alexander Feldman, chairman, president and CEO of the US-ASEAN Business Council, said that, in principle, he supports investment opportunities in Indonesia’s sovereign wealth fund but that “details do matter.”
“I have not seen the structure of how the wealth fund is going to ensure that the money is used in ways it's intended,” Feldman said.
Indonesia scored 40 points out of 100 on the 2019 Corruption Perceptions Index, which ranks countries based on how corrupt their public sector is perceived on a scale of 0 (highly corrupt) to 100 (very clean).
Considering that the country does not have large capital reserves and has a reputation for mismanagement of resources, “the primary motivation for investing in this new sovereign wealth fund would be political as opposed to financial,” Connelly said.
Trump maintains personal business interests in Indonesia through his family enterprise.
In August 2019, while promoting Trump-branded properties in Bali and West Java, Donald Trump Jr. was dogged by allegations that the Trump Organization's global business empire creates conflicts of interest for his father's administration.
The Indonesian delegation said they also met with the Biden-Harris transition team during their U.S. visit.
