Jakarta, INTI - The governments of Indonesia and Germany have strengthened their partnership with several funding agreements to support the development of renewable energy, electricity grids, and economic and trade reforms.
During German President Frank-Walter Steinmeier's visit to Indonesia on Monday, June 15, both countries expressed their commitment to strengthening bilateral relations across various sectors.
"I am very pleased that we have both agreed to strengthen our partnership, not only at the political level, but also in the fields of economics, skilled labor, climate, science, and culture," said Steinmeier during the visit to Merdeka Palace, Jakarta.
Boosting Support for Indonesia’s Programs
German Ambassador to Indonesia, Ralf Beste, explained that strengthening bilateral relations also includes increasing trade and investment. He stated that the Indonesia-European Union Comprehensive Economic Partnership Agreement (I-EU CEPA) has the potential to boost exports and investment for both countries.
"The recent surge in global oil and gas prices also demonstrates the need for a transition to renewable energy not only to protect the climate but also to ensure energy security. The Just Energy Transition Partnership (JETP), co-led by our two countries, also contributes to this," said Beste.
The German Embassy in Indonesia noted that one of the agreements signed was the Competitiveness, Industrial Modernization, and Trade Acceleration Program (CITA), worth 400 million euros. The program was signed by the German Development Bank KfW and the Indonesian Ministry of Finance.
The CITA program aims to support Indonesia's economic reforms by creating a more conducive investment climate, reducing trade barriers, and developing sustainable and inclusive businesses.
Agreement with PLN
In addition, KfW and PT PLN (Persero) signed a US$302 million agreement under the Accelerating Indonesia's Clean Energy Transition Program. This program supports the construction of renewable energy plants and the strengthening of the electricity grid to accelerate the integration of clean energy.
The German Embassy explained that the program is also part of Germany's contribution to Indonesia's JETP. Since early 2025, Germany, together with Japan, has led the International Partners Group (IPG) in the implementation of JETP.
"Germany has committed to allocating a total of approximately 1 billion euros for development cooperation by 2026, equivalent to approximately Rp20 trillion," the German Embassy stated.
In February 2026, Indonesia and Germany also agreed on two funding agreements totaling 308 million euros for the Green Energy Corridors Sulawesi (GECS) and Green Bond Development Facility (GBDF) projects.
The GECS project will build a 275 kV electricity transmission network in South Sulawesi to unlock the region's renewable energy potential. The GBDF aims to strengthen Indonesia's green bond market to attract more sustainable investment.
The German Embassy considers these agreements to be concrete steps in accelerating the implementation of JETP and supporting the target of transitioning to a cleaner and more sustainable energy system in Indonesia.
Conclusion
The governments of Indonesia and Germany have strengthened bilateral cooperation through several funding agreements supporting the energy transition, economic reform, and increased trade and investment. During German President Frank-Walter Steinmeier's visit to Indonesia, the two countries affirmed their commitment to strengthening their partnership in the fields of economics, energy, climate, science, and culture. Among the key agreements is the CITA Program to support economic reform and the investment climate in Indonesia, and the support for the implementation of the Just Energy Transition Partnership (JETP).
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