Former Australian Prime Minister Paul Keating has been appointed as a strategic adviser on East Asia to Indonesian President Prabowo Subianto. This significant role includes joining the advisory board of Indonesia’s sovereign wealth fund, Danantara, which was launched earlier this year with assets totaling USD 900 billion (approximately AUD 1.37 trillion). The announcement came via a personal letter delivered by Indonesia’s Foreign Minister Sugiono during his visit to Australia.
Keating confirmed the invitation but did not provide further details. Danantara is among the largest sovereign wealth funds globally and is crucial to Prabowo’s ambition to elevate Indonesia’s economic growth from 5 percent to 8 percent annually by 2029. The advisory board he will join is chaired by billionaire hedge-fund manager Ray Dalio and features notable members such as former Thai Prime Minister Thaksin Shinawatra, former Credit Suisse executive Helman Sitohang, and renowned economist Jeffrey Sachs.
Former Australian prime ministers often take on advisory roles with foreign governments and companies. For example, former Prime Minister Tony Abbott was appointed as an official UK trade adviser by former Prime Minister Boris Johnson, while both Keating and Bob Hawke had roles advising Chinese companies. Keating served on the advisory board of the China Development Bank from 2005 to 2018.
Investment Initiatives and Strengthening Ties
“I hope to have actually a specific way to announce later in the week that we can advance that really important economic relationship,”
said Australian Treasurer Jim Chalmers, who is set to meet his Indonesian counterpart later this week during the G20 summit in Durban, South Africa. This dialogue indicates a commitment to enhancing bilateral economic relations.
Danantara is preparing for a roadshow in Australia scheduled for September 2024, aiming to deploy capital in strategic investments globally. Alongside this initiative, Anindya Bakrie, the head of Indonesia’s Chamber of Commerce and Industry (Kadin), is expected to visit Melbourne to foster deeper business connections between the two nations. Indonesia has also recently appointed new consuls-general in Melbourne and Sydney to strengthen investor relationships.
The push for stronger ties between Australia and Indonesia is underscored by Indonesia’s projected growth as the world’s fourth-largest democracy by 2040. This relationship has historical significance; in 1994, Keating emphasized that “no country is more important to Australia than Indonesia,” a sentiment echoed by current Prime Minister Anthony Albanese during his visit to Jakarta after the recent federal election.
Keating’s tenure as Prime Minister was marked by a strong relationship with Indonesia, particularly with then-President Suharto, Prabowo’s late father-in-law. This partnership, which transformed Australia’s diplomatic stance towards Indonesia from adversary to stable partner, lasted until the East Timor crisis in 1999.
Strengthening defense ties remains a priority for the Albanese government, illustrated by recent agreements such as the treaty-level defense cooperation signed by Defense Minister Richard Marles in August 2024. As these diplomatic and economic initiatives unfold, the relationship between Australia and Indonesia continues to evolve, reflecting both nations’ aspirations for growth and stability in the region.
