Aust, Indonesia to renew trade pact talks

17-Aust Indonesia to renew trade pact talks

By Gabrielle Dunlevy, AAP Southeast Asia Correspondent

Yogyakarta

(Australian Associated Press)

Australia will treat the forging of a trade agreement with Indonesia as a priority and could have it sealed within 12 months.

Trade Minister Andrew Robb and his counterpart Tom Lembong have agreed to reinvigorate stalled talks on a comprehensive economic partnership agreement in the new year.

The minister is leading Australia’s biggest trade delegation of more than 350 business people to Indonesia to put momentum behind the deal.

Mr Robb says Prime Minister Malcolm Turnbull’s “strong meeting of the minds” with President Joko Widodo when they met for the first time last week had paved the way for the fresh talks.

“We’ve been dealing with others in 12 months so I can’t see why we won’t deal with this one in 12 months,” he told reporters in Yogyakarta, referring to agreements with South Korea, China and the TPP.

“My sense was that we needed to get better momentum with the commercial relationship.

“We’ve got 250 companies here in Indonesia, that is unsatisfactory…. We should have 1000 companies.” The trade mission, known as Indonesia Australia Business Week is an effort to address this.

Indonesia is only Australia’s 12th largest trading partner despite its proximity. Two-way trade with the market of 250 million people is only worth $16 billion compared with $46 billion in trade with New Zealand.

A large obstacle has been Indonesia’s messy and unpredictable regulatory climate, an example of which was the shock decision from Jakarta earlier this year to slash cattle import permits.

Australian producers were forced to scramble for other markets, beef became unaffordable for Indonesians and in the fallout, the trade minister was axed from cabinet and replaced by Mr Lembong.

Mr Robb says the new minister’s statements on winding back barriers to investment, as well as the president’s interest in joining the TPP, are a “breath of fresh air” for those seeking to do business in Indonesia.

“It’s a very ambitious statement, but it’s a very important one and these things tend to move people,” he said.

Mr Lembong has said Indonesia’s “unfriendly” protectionist measures have taken a toll on Indonesia.

He told Philippines website Rappler it was time for a change.

“We’re not a defensive culture, we’re not a closed culture, we’re not a culture of losers. We’re a culture of winners, we’re a self-confident society,” he said on the sidelines of the APEC summit on Monday.

Also on Tuesday, Mr Robb launched a new report by the Australia Indonesia Centre, ANZ and PwC on finding joint opportunities to tap a potential $3 trillion growth in trade in the ASEAN economy over the next decade.

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