Saudi Gazette JEDDAH – PT Wijaya Karya (Wika), an Indonesian construction giant, has signed Saturday a strategic partnership agreement with a Jeddah-based construction firm to pump investments worth millions of dollars into the Saudi market. The agreement was inked by Bimo Prasetyo, division manager of Overseas Department of Wika, and Adil Abdul Munief Makki, CEO of Adil Makkah Contracting Corporation (AMCO), at a ceremony held in Obhur, Jeddah. The ceremony was attended by several senior officials of the Indonesian consulate, Jeddah Chamber of Commerce and Industry (JCCI) as well as Wika and AMCO. They included Vice Consul Jurman Nazar, who is responsible for economic section at Indonesian consulate general, Muammar Al-Atawi, chairman of the committee for contractors at JCCI, Siddik Siregar, general manager of the Overseas Department of Wika, and Rahimul Amin, marketing manager of Wika Saudi. Makki, who is also director of hospitality committee and member of tourism committee at JCCI, told Saudi Gazette that three projects worth SR30 million will be implemented in Jeddah in 2016 as part of the agreement. These include construction of administrative building, commercial center, and villa duplex. Makki further said the Indonesian construction giant's entry will spur the Kingdom's booming construction sector and will attract advanced technology to this vital sector. "The agreement was signed after intensive consultations and administrative procedures that lasted for nearly one year, and the deal is for a period of 10 years and that can be renewable. Wika has scored successful stories in the contracting and construction fields not only in Indonesia, but also in several other countries," he noted. Siregar said Wika is happy to enter the Saudi market through having strategic partnership with AMCO. "This is part of our strategy to have strong presence in the Gulf and other Arab countries. Ever since the company's decision for expansion abroad in 2007, the company has entered the markets of the United Arab Emirates, Algeria, Libya, in addition to Myanmar, Malaysia, Brunei and East Timor." Speaking on behalf of Dharmakirty Syailendra Putra, consul general of Indonesia, Jurman said Indonesia wants to take advantage of the huge potential of the Saudi infrastructure and construction markets. "As the most populous Muslim nation, which sends the largest number of Haj and Umrah pilgrims, Indonesia is serious in expanding strong ties with the Kingdom in trade, investment and construction sectors. There has been five percent growth in investments between the two countries in 2015 alone compared to previous years." "In the backdrop of the fall in oil prices, the Kingdom is focusing more on non-oil sectors, and hence Indonesia wants to capitalize on it," he said. Jurman also unveiled Indonesia's plan to have stronger ties with the Kingdom in the small and medium enterprises (SMEs) and Islamic finance sectors. "Muliaman Hadad, chairman of Indonesia's Financial Services Authority, will be one of the speakers at the upcoming Jeddah Economic Forum, slated in March. Hadad, who is an expert in Islamic finance and SMEs, will speak about the role of Islamic financing in SMEs," he said, adding that SMEs are the backbone of Indonesia's economy and there is vast scope for cooperation between the two countries in this sector. Muammar Al-Atawi said an Indonesian construction giant is entering the Saudi market for the first time. "The entry of such firms in the Mideast's largest market shows the potential of Saudi construction sector and its continuous growth at a time when construction markets of many other countries witness slowdown." Wika has obtained in 2015 the foreign investor license from the Saudi Arabian General Investment Authority (SAGIA). Bimo Prasetyo said the company expects signing of agreements amounting to more than $200 million during the current year in the Kingdom. "There are several projects costing over $40 million under study and these include construction of residential and commercial center projects," he said. Established in 1960, PT Wijaya Karya (Persero) Tbk. is the largest construction company in Indonesia, with a staff of more than 22,000, and the company's stake in the country's construction and contracting market exceeds 35 percent. Wika, a state-controlled company, is one of the first choices to participate in government infrastructure projects. Its businesses include civil engineering, construction of buildings and industrial plants, as well as energy facilities besides mechanical, electrical and mining projects, and real estate sector. AMCO, established in 2008, has so far implemented a number of mega projects, including those for the Saudi Arabian Airlines as well as for the ministries of defense and education, according to Makki. He said the strategic partnership with Wika will be a big boost to the Saudi economy. "As part of implementing the initial projects in Jeddah, we have reached a contract with the Jeddah-based property developer Idafa Co. Idafa will get us land, building design and will complete other necessary procedures for implementing the projects," he added.
