Indonesia and Fujian Province Forge Ahead with Two Countries Twin Parks Initiative, Accelerating Batang Industropolis Development

Jakarta, Indonesia – A pivotal meeting held at the Coordinating Ministry for Economic Affairs in Jakarta saw Coordinating Minister Airlangga Hartarto receive Zhao Zenglian, the Vice Governor of China’s Fujian Province, to advance the ambitious Two Countries Twin Parks (TCTP) cooperation program. The discussions culminated in a mutual agreement to expedite the identification and compilation of a list of potential projects and priority sectors. This strategic move aims to lay a concrete foundation for TCTP’s expansion, ensuring its development is more targeted and responsive to the specific economic needs and strategic objectives of both nations. The TCTP program is a cornerstone of enhanced economic cooperation, designed to bolster trade, attract investment, and foster industrial development between Indonesia and the People’s Republic of China.

Strategic Imperatives for Bilateral Economic Growth

The meeting underscored the profound strategic importance of the TCTP initiative within the broader framework of Indonesia-China economic relations. Coordinating Minister Hartarto emphasized the Indonesian government’s commitment to realizing the full potential of its Special Economic Zones (SEZs), particularly the Batang Industropolis SEZ. "In line with President Prabowo Subianto’s directives, the development of the Batang Industropolis SEZ, which was officially inaugurated on March 20, 2025, as Indonesia’s ‘Shenzhen,’ is expected to materialize swiftly. This will be achieved, in part, through the accelerated implementation of various concrete projects under the TCTP program," Hartarto stated in an official press release issued on Friday, July 24, 2026. His remarks highlight the high-level political backing for the project and its aspirational vision to replicate the economic dynamism and innovation seen in China’s pioneering Special Economic Zones.

Hartarto further expressed Indonesia’s deep appreciation for the consistent support and tangible cooperation extended by the Fujian Provincial Government. He reiterated the urgency for rapid implementation of the TCTP agenda, recognizing it as a critical vehicle for driving shared prosperity. The TCTP framework has already fostered robust collaboration across various levels, encompassing economic and industrial zones, local governments, and private sector actors from both Indonesia and China. To date, this collaborative spirit has translated into the signing of 30 Memoranda of Understanding (MoUs), representing an estimated investment value of approximately IDR 37.1 trillion (equivalent to roughly USD 2.5 billion, based on prevailing exchange rates at the time of reporting). This substantial commitment underscores the strong confidence in the program’s potential and the mutual benefits it is expected to generate.

The Genesis and Evolution of the Two Countries Twin Parks Initiative

The Two Countries Twin Parks (TCTP) initiative is a significant bilateral economic cooperation mechanism between Indonesia and China, often viewed as an extension of China’s ambitious Belt and Road Initiative (BRI). While not explicitly named as a BRI project in all contexts, TCTP aligns perfectly with the BRI’s objectives of fostering connectivity, infrastructure development, and economic integration across Asia and beyond. The concept of "twin parks" typically involves the establishment of industrial parks or economic zones in each country that are designed to complement each other, facilitating cross-border investment, supply chain integration, and market access.

For Indonesia, the TCTP program offers a strategic pathway to attract foreign direct investment (FDI) into key manufacturing and industrial sectors, create employment opportunities, and transfer advanced technology and management expertise. For China, it provides an avenue to diversify its manufacturing bases, enhance its regional supply chains, and access new markets, particularly within the dynamic ASEAN region. The choice of Fujian Province as a key partner is no coincidence. Fujian, located on China’s southeastern coast, has a rich history of trade and maritime connections, and its own robust industrial base, including significant experience in developing and managing Special Economic Zones. Its geographical proximity and cultural ties to Southeast Asia make it an ideal counterpart for Indonesia in this ambitious endeavor.

The groundwork for TCTP has been laid over several years, building on existing diplomatic and economic ties. Early discussions focused on identifying suitable locations in both countries that could serve as the "twin parks." Indonesia’s strategic choice for its anchor park has been the Batang Industropolis Special Economic Zone, a sprawling industrial estate designed to attract high-tech manufacturing, automotive, chemical, and other value-added industries.

Batang Industropolis: Indonesia’s Vision of a New Industrial Hub

The Batang Industropolis Special Economic Zone (SEZ), situated in Central Java, is a cornerstone of Indonesia’s industrial transformation agenda. Its designation as an SEZ grants it a range of fiscal and non-fiscal incentives designed to lure both domestic and foreign investors. These incentives typically include tax holidays, tax allowances, import duty exemptions, simplified licensing procedures, and special immigration policies. The vision for Batang Industropolis as "Indonesia’s Shenzhen" reflects an aspiration to replicate the rapid economic growth, industrial diversification, and technological innovation that transformed Shenzhen from a fishing village into a global manufacturing and technology hub within a few decades.

The strategic location of Batang Industropolis, with its access to major transportation arteries including a toll road, railway line, and proximity to Semarang’s international airport and Tanjung Emas seaport, makes it an attractive destination for logistics-intensive industries. The Indonesian government has invested heavily in infrastructure development within and around the zone to ensure it meets the demands of modern manufacturing. The official inauguration on March 20, 2025, marked a significant milestone, signaling its readiness to welcome large-scale investments. The TCTP program, by channeling Chinese investment and expertise, is expected to play a crucial role in accelerating the populating and operationalization of this ambitious industrial park.

Fujian’s Role and Proposed Acceleration Strategies

Vice Governor Zhao Zenglian, representing the Fujian Provincial Government, articulated several strategic steps to accelerate the implementation of the TCTP program. These include strengthening coordination among all stakeholders, which implies closer collaboration between government agencies, local authorities, and business entities in both countries. Furthermore, Zhao emphasized the critical need for meticulous identification of priority projects and sectors, ensuring that investments are directed towards areas with the highest potential for mutual benefit and sustainable growth. The formulation of clear follow-up actions is also deemed essential to ensure that cooperation can be implemented effectively and in a focused manner.

"We stand ready to work hand-in-hand with the Indonesian Government to drive the development of the areas within the TCTP program," Zhao affirmed. "We are committed to identifying priority sectors that hold significant potential for joint development with Fujian Province." This statement underscores Fujian’s proactive stance and its readiness to commit resources and expertise to the initiative. Given Fujian’s own experience in developing successful economic zones and its strong manufacturing base in electronics, textiles, and petrochemicals, its partnership is particularly valuable for Indonesia’s industrial ambitions.

Enhancing the Ecosystem: Trade Facilitation and Investment Climate

Beyond the high-level agreements, both nations are actively working to strengthen the underlying ecosystem supporting TCTP’s implementation. This includes robust efforts in trade facilitation, streamlining customs procedures, and ensuring the smooth flow of goods between the two countries. Enhancing market access for products originating from the TCTP zones is also a key focus. These measures are designed to cultivate an increasingly conducive business environment, thereby amplifying the investment appeal of the TCTP areas.

For instance, improvements in customs coordination can significantly reduce lead times and costs for businesses operating within the parks. Simplified import/export procedures, transparent regulations, and efficient logistics networks are vital for attracting and retaining investors. Indonesia’s commitment to bureaucratic reform and digitalizing government services also plays a crucial role in creating a more investor-friendly climate. These efforts are not merely administrative; they are strategic imperatives to ensure that the TCTP program delivers on its promise of fostering robust economic growth and integration.

Broader Implications and Future Outlook

The accelerated implementation of the Two Countries Twin Parks initiative carries significant implications for both Indonesia and China, as well as for the broader regional economic landscape.

For Indonesia:

• Economic Diversification and Industrialization: TCTP is expected to accelerate Indonesia’s shift from a resource-dependent economy to a more industrialized, manufacturing-based one, reducing reliance on raw material exports.
• Job Creation: Large-scale industrial development in Batang Industropolis and other potential TCTP sites will generate substantial employment opportunities, both direct and indirect, across various skill levels.
• Technology Transfer and Skill Development: Chinese investments often come with technology and management expertise, which can foster local skill development and upgrade Indonesia’s industrial capabilities.
• Infrastructure Development: The program incentivizes further development of supporting infrastructure, including power, water, transportation, and digital connectivity.
• Regional Development: By focusing on areas like Central Java, TCTP contributes to more balanced regional development, potentially reducing economic disparities.
• Foreign Direct Investment (FDI): China has consistently been one of the largest sources of FDI for Indonesia. TCTP reinforces this trend, providing a structured framework for new investments.

For China and Fujian Province:

• Market Access: TCTP offers Chinese companies preferential access to the large and growing Indonesian domestic market, as well as a gateway to the broader ASEAN economic community.
• Supply Chain Resilience: Diversifying manufacturing bases into Indonesia can enhance the resilience of Chinese supply chains, particularly in a volatile global economic environment.
• Belt and Road Initiative (BRI) Synergy: The program strengthens the economic pillars of the BRI in Southeast Asia, showcasing practical cooperation outcomes.
• Regional Influence: Deeper economic ties through TCTP enhance China’s economic and strategic influence in the region, fostering win-win partnerships.

Challenges and Mitigations:
Despite the immense potential, the TCTP program is not without its challenges. These include:

• Regulatory Consistency: Ensuring consistent and predictable regulatory frameworks across different levels of government in Indonesia.
• Infrastructure Readiness: While significant progress has been made, continuous investment in infrastructure is vital to keep pace with industrial demand.
• Skilled Labor Availability: Matching the demand for skilled labor with local supply, potentially requiring investment in vocational training and education.
• Environmental Sustainability: Balancing rapid industrial development with environmental protection and sustainable practices.
• Geopolitical Dynamics: Navigating broader geopolitical currents that may influence bilateral relations.

Both Indonesian and Fujianese officials appear committed to addressing these challenges through continuous dialogue, proactive policy adjustments, and robust stakeholder engagement. The established framework of the TCTP, with its emphasis on detailed project identification and coordinated implementation, is designed to systematically overcome potential hurdles.

The recent meeting between Coordinating Minister Airlangga Hartarto and Vice Governor Zhao Zenglian represents a renewed impetus for the Two Countries Twin Parks initiative. With strong political backing from both Jakarta and Beijing, and a clear roadmap for accelerating projects within the Batang Industropolis SEZ, the program is poised to enter a new phase of concrete implementation. The successful realization of this vision will not only transform Indonesia’s industrial landscape but also deepen the economic partnership between two of Asia’s most dynamic economies, contributing significantly to regional stability and prosperity. The IDR 37.1 trillion in signed MOUs serves as a powerful testament to the tangible commitment and the promising trajectory of this ambitious bilateral undertaking.