Caspian Energy Journal Caspian European Club
Thursday, 20 October 2016 16:00

We are ready to invest into economy of Azerbaijan - Ambassador of Indonesia Featured

Caspian Energy (CE): Your Excellency, you arrived in Azerbaijan most recently, in May this year. What still untapped economic opportunities and potential do you see in the development of relations between the two countries?

Husnan Bey Fananie, Ambassador Extraordinary and Plenipotentiary of Indonesia to the Republic of Azerbaijan:  My mission in Azerbaijan started in May 2016, when the economic situation in the country deteriorated against the background of the crisis in the global oil markets. But for me and for our country Azerbaijan is obviously a strategically important country, not only within its region, but also across Central and Eastern Europe.  Compared to Azerbaijan where the population totals 10 ml people, Indonesia is a large country with a population of 155ml people, located between the two oceans, two continents and consisting of 17,500 islands. A country with such a large population requires a large amount of energy and electricity. Indonesia has oil like Azerbaijan does. We do produce 800,000 barrels per day, but we need 1,600,000 barrels per day”, the Ambassador said. Thus, according to him, Indonesia has to import about half of the required volume. “We buy oil from Azerbaijan while also acquiring it from Saudi Arabia, Algeria and Iran. To that end, every year we spend as much as $2.4 billion. From Azerbaijan we import from 400,000 up to 600,000 barrels per day. That is why, in recent years Indonesia has been the third largest trade partner of Azerbaijan, after Italy and Germany. In addition, we also buy mazut oil from Azerbaijan.



CE: Do you see any prospects in this area?

Husnan Bey Fananie: Yes of course, Azerbaijan will keep staying our important business partner as well as a major partner in the field of energy security. Our trade opportunities are big but people in Azerbaijan know few about Indonesia and do not apply Indonesian goods. All necessary products you buy in Baku, Gandja, Sheki and other cities are supplied from Turkey, China and Germany.


CE: What could we buy from Indonesia?

Husnan Bey Fananie: Assortment is very big: agricultural products such as coffee, tea, palm oil; light industry products – furniture, tires, clothes, etc.  You buy this product in Turkey and China whereas you could have them delivered from Indonesia. Our current goods turnover is $32ml, which is a very low indicator. We buy oil from Azerbaijan and to that end, every year we spend as much as $2.4 billion. We are the third big customers after Italy and Germany. We will be glad if investors of Azerbaijan and companies come to Indonesia. Our region does not only consist of the population of Indonesia – it is the South-East Asia, including Australia, Philippines, Singapore, Vietnam and Guinea. In general, there are 600ml people living in this region. Mutual drawing of investments into economies of the two countries will help to gain big success. Just like in Azerbaijan, tourism infrastructure of Indonesia is developing actively as well. For instance, we also built Fairmont Hotel just like the way you did. We have it built in New York, London, Abu Dhabi and Dubai. Azerbaijan, Indonesia and Turkey are Muslim countries and very close to one another which is why they are capable of building relations in different areas and gaining success. 


CE: Mr. Ambassador, how shall we overcome the transportation leg, does not Indonesia plan to join the North-South or Great Silk Way project?

Husnan Bey Fananie: We have already done it. We have our own route from Java to Sumatra, from Sumatra to Malaysia, from Malaysia to Thailand, from Thailand to Vietnam, from Vietnam to China. Now it is turn of Azerbaijan, Kazakhstan and Middle Eastern countries to lay the route from China to Europe. We have completed our work in the south, now it is turn of Azerbaijan and Kazakhstan to ensure their route. We have built transport connections since 1945 since we gained the independence. Today we are waiting for Azerbaijan, Kazakhstan, Uzbekistan, Afghanistan, Pakistan and China as well as northern countries to join our route. 



CE: What capabilities for expanding the bilateral cooperation do you see in the current processes of reforming the economy of Azerbaijan?

Husnan Bey Fananie: If we want to build our cooperation in the economy, we have to establish good transportation links – between Baku to Jakarta and Jakarta to Baku and cooperation between AZAL and Indonesian Airlines. We have to establish a direct flight between Indonesia and Azerbaijan just like the one which is opened between Indonesian and Turkey. We also had a talk with President of Azerbaijan Mr. Ilham Aliyev about the establishment of air transportation.  Indonesia has already established an air flight with Turkey. Turkish Airlines fly to Indonesia. We can attract many Indonesian tourists to Azerbaijan. Every day we have people travelling to Umrah (Hajj). We can send them back to Indonesia through Azerbaijan as an alternative to several well established transit points. It will not only help to develop further cooperation in the field of tourism but also develop a certain awareness and understanding between Indonesia and Azerbaijan.


CE: Do you find the investment climate in Azerbaijan favorable for an Indonesian investor?

Husnan Bey Fananie: Yes, of course. However, there is a decline observed this year due to the instability and slow development of economy. The economic situation in Azerbaijan has suddenly worsened because of the crisis. But for me and for our country Azerbaijan is obviously a strategically important country, not only within its region, but also across Central and Eastern Europe. Therefore, I think that the next year will be more productive and our investors will come to Azerbaijan to implement projects and build facilities in your country.



CE: You have invited Azerbaijan’s President to visit Indonesia … Is the approximate date of this visit known?

Husnan Bey Fananie: I hope that President of Azerbaijan Ilham Aliyev will visit Indonesia later this year, and the next year will be followed by the visit of the President of Indonesia Joko Widodo to Azerbaijan.  It is very important to strengthen our relations as well as encourage Azerbaijani investors to visit Indonesia  and Indonesian investors to visit your country for further discussion of cooperation issues.


CE:  Does the state company of Indonesia Pertamina plans to participate in energy projects of Azerbaijan?

Husnan Bey Fananie: Of course.  We are already buying your oil which is famous for its quality. Pertamina Company is currently holding exploration work in the shelf of Indonesia. Indonesia has big prospects in this area. There are foreign companies operating on basis of the licenses.  The state company of Indonesia can join upstream operations in the Caspian in future, but for now we are only buying oil from Azerbaijan.


CE: In one of your interviews you noted that one of the goals is to strengthen cooperation in such areas as tourism, investment and trade. What success has been achieved in this context?

Husnan Bey Fananie: I have been here for 7 months.  Throughout my stay here I have provided all the information about Indonesia via different events, exhibitions and festivals. I attracted many tourists from Indonesia for formula 1. Therefore, the work in this direction is already underway. I apply to our businessmen so that they establish contacts with their colleagues from Azerbaijan. 15 businessmen from Azerbaijan have this month left for Indonesia to participate in the trade exhibition TEI which is held in Indonesia on October 11-15. We are ready to keep expanding cooperation in this area. Azerbaijan is a very beautiful country and I am very pleased to be here.


Thank you for the interview

Interview made by Emil Mammadov, Sabina Mammadova




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