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DP World signs $7.5bn maritime deal with Indonesia

Christian Fernsby |
The Indonesia Investment Authority (INA) signed a strategic alliance agreement with DP World to enhance Indonesia’s maritime and port sector within the global manufacturing ecosystem.

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The economic value of this partnership could reach up to $7.5 billion over the long term. This partnership will improve the operation of ports, reduce logistics costs, and advance national competitiveness.

DP World and INA will form a consortium and working team to explore investments into the logistics infrastructure in Indonesia, including hinterland investments, inland terminals, cargo parks, feeder network systems, landside transport, and industrial zones.

They will also explore collaboration with the Indonesia Port Corporations (Pelindo). DP World will seek to leverage its joint investment platform with Caisse de dépôt et placement du Québec (CDPQ) which since its launch in 2016 has invested in 12 port terminals globally across various stages of the asset lifecycle.

Indonesia is the largest archipelago in the world with more than 17,000 islands. Its vast geography makes it reliant on a strong domestic shipping network.

Despite historically trailing neighbouring countries in containerization rate and currently facing issues of high logistics costs, Indonesia is already among the top 15 countries in terms of container traffic and has much potential to grow further.

Furthermore, containerization rate in Indonesia will only increase given the burgeoning domestic consumption and production.

DP World will also introduce its global best practices to Indonesia, including operations optimisation, service innovation, disruptive technologies, and safety principles. Cutting edge logistics technology includes fully automated stacking to eliminate inefficiency, hyperloop systems for fast cargo delivery, and 100% electric sustainable means of cargo transport.

DP World Group Chairman and CEO H. E. Sultan Ahmed Bin Sulayem said, “DP World recognises the vast potential of Indonesia as one of the fastest-growing economies in the world, as well as projects undertaken by the government to improve port facilities. Through our partnership with INA, we are committed to supporting national initiatives that create value and bring in expertise to modernise the Indonesian maritime infrastructure.”

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