Agriculture is a key driver of the Indonesian economy, accounting for 50 percent of total employment and contributing 13 percent of Indonesia’s US$1.11 trillion gross domestic product (GDP). The transformative potential of agricultural technology in Indonesia is clear, with a recent four-year study by CSIRO demonstrating an average increase in profitability of 117% through the application of agtech innovations across a range of production systems.
For smart investors and ag-tech companies, this represents an exceptional opportunity. And for Australian investors in particular, the new Indonesia-Australia Common Economic Partnership Agreement (IA-CEPA) makes this prospect more attractive still by addressing impediments to increasing Australian investment in Indonesia. Agricultural supply chain investment represents a particular area of opportunity, as Indonesia has guaranteed under IA-CEPA that majority Australian-owned business can operate railways and road transport infrastructure in the country.