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Indonesia
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Indonesian ex-minister rebuffs claims of China bias amid ‘state within a state’ airport row

Luhut Pandjaitan says China’s technological prowess and deep pockets made it an ideal partner for propelling Indonesia’s economy

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The Indonesia Morowali Industrial Park, one of the biggest nickel producers in Konawe Utara. Photo: AFP
SCMP’s Asia desk

A former Indonesian minister has dismissed claims of giving preferential treatment to Chinese firms and wooing investors with policies undermining the country’s sovereignty, amid furore over an airport inside a major industrial cluster that risks becoming a “state within a state”.

Luhut Pandjaitan, a key architect of ex-president Joko Widodo’s mineral downstreaming strategy, said China’s technological prowess and deep pockets made it an ideal partner for propelling the local economy as others like the US were reluctant to finance projects and share the expertise with Jakarta in the past.

“China was the only one ready to step in [at the time],” the former coordinating maritime affairs and investment minister said in a statement on Monday.

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“We don’t side with China or the United States, we side with Indonesia,” he said, crediting downstreaming for the country’s gross domestic product which was expected to grow between 4.9 per cent and 5.7 per cent next year.

Downstreaming refers to processing critical minerals domestically.

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The US did not have the tech capability to engage in downstreaming and was “far behind China”, Luhut said, citing a discussion with Tesla chief Elon Musk, The Jakarta Post reported.

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