VOI - Voice of Indonesia | RRI - Radio Republik Indonesia

Russia is a strategic and important partner for Indonesia. For almost 70 years, Indonesia and Russia have maintained, not only the bonds of friendship and close cooperation but also historical relations. This was conveyed by Coordinating Minister for the Economy Darmin Nasution at the reception of the 27th Russian National Day in Jakarta, Friday (06/28/2019). Minister Darmin Nasution underlined the importance of strengthening bilateral cooperation relations in the future. He said the two countries had benefited from several mechanisms for formal bilateral relations through 3 pillars of cooperation.

"Let me take this opportunity to underline the importance of strengthening future bilateral cooperation. We have been benefited from the several existing formal bilateral mechanism passing 3 pillars of cooperation namely political and security, economic trade, and investment, as well as social-cultural, " said Darmin Nasution.

Furthermore Coordinating Minister for the Economy Darmin Nasution the economic cooperation between the two countries that has been carried out includes, among others, strategic investments in infrastructure, energy, and transportation.

On the occasion, Darmin congratulated the National Day of the Russian Federation and hoped that the 70th anniversary of diplomatic relations between the two countries in February 2020 could further strengthen bilateral relations and partnerships that have been going on for a long time. (VOI / AHM)

Romania is expected to help in accelerating the negotiation of the Indonesia and European Union Comprehensive Economic Partnership Agreement (I-EU CEPA) which will enter the 8th round. As stated by the Expert Staff for Politics, Law and Security, Ministry of Foreign Affairs, Teuku Faizasyah, in Jakarta on Thursday (28/06/2019), at a reception which marked the end of the first rotating Presidency of Romania to the Council of the European Union. In addition, Teuku Faizasyah also hopes there will be a lot of progress afor the 8th round of the I-EU CEPA negotiations and there will be no more rounds of negotiations.

“And I called on Romanian support to expedite the conclusions of the ambitious and the achievable Indonesia-European Union Comprehensive Economic Partnership Agreement (I-EU CEPA). I’m pleased to learn on the many progress of the I-EU CEPA negotiations last week in Jakarta that there was the 8th round of negotiations. Let us hope that during the next round of negotiation, we can achieve more progress and we don’t need more round of negotiations,” said Teuku Faizasyah.

During the event, the Romanian Ambassador to Indonesia Valerica Epure handed over the stick of the Presidency of the European Union Council to the Finnish Ambassador to Indonesia, Jari Sinkari, which marked the start of the Finnish Presidency for the European Union Council. Romania holds the first 6 months of the Trio Presidency of the European Union Council, which starts on 1 January 2019, followed by Finland from July - December 2019 and Croatia from January - June 2020. (VOI / AHM)

Indonesia and South Korea are committed to accelerating the completion of the Comprehensive Economic Cooperation Agreement (Indonesia-Korea Comprehensive Economic Partnership Agreement / IK-CEPA) before the end of 2019. This commitment is marked by further negotiations between Indonesia and South Korea at the IK-CEPA intersection meeting which held on 18-25 June 2019 in Jakarta.

The intersection meeting series was held in parallel with six working group meetings and two working subgroups including trade in goods (subgroups of instrument work trade safeguards and text trade subgroups of goods), services, investment, provisions of origin, customs procedures and trade facilitation (ROOCPTF), cooperation and capacity building, as well as legal and institutional issues.

"As the agreement between the two countries to finalize the IK-CEPA negotiations as soon as possible this year, this meeting shows progress in resolving several pending issues, especially related to market access and discussion of the concept of negotiating texts," said Director of Bilateral Negociation at the Ministry of Trade Ni Made Ayu Marthini .

During the meeting, both parties committed to making the IK-CEPA a better agreement than the commitment of the two countries in the previous agreement, namely the ASEAN-Korean FTA (AKFTA). In this meeting, the two delegates also exchanged views on the initial market access offer that was exchanged on June 14, 2019. In addition, there were advances in the discussion of the concept of trade in goods and the concept of text on security instruments
trade in which most of the articles have been agreed before.

In the working group on cooperation and capacity building, the two parties discussed several possibilities for cooperation between the two countries in the industrial sector, trade in services, and capacity building in the health sector. This working group will produce a mutually beneficial and sustainable design of Indonesia and South Korea cooperation. The cooperation, especially in the fields of industry, health, fisheries, and other potential sectors, so as to increase South Korean investment in Indonesia.

In service negotiations, both parties discussed service market access for the distribution sector, legal services, construction services, independent professionals, as well as training participants and capacity building. 

"The mutually beneficial increase in trade and two-way investment can be achieved if the IK-CEPA negotiations can be resolved," Made said.

The Indonesian and South Korean delegates are scheduled to meet again in August 2019 in the next IK-CEPA round to be held in South Korea.

IK-CEPA Negotiation Overview

IK-CEPA negotiations are based on the agreement between the two countries to start a comprehensive economic partnership by forming a joint study group (JSG / joint study group) IK-CEPA. The JSG meeting was held three times in 2011 and produced a JSG report in October 2011. During the period 2012-2014, the negotiations lasted until the 7th round and then stopped due to the change of government.

On February 19, 2019, the two countries agreed to reactivate the IK-CEPA negotiations through the signing of a Joint Ministerial Statement by the Minister of Trade of the two countries. IK-CEPA negotiations are targeted for completion in November 2019.

Indonesia-South Korea Trade Relations at a Glance

South Korea is the 7th largest export and source destination for Indonesia in 2018. The trade between Indonesia and South Korea in 2018 reached USD 18.6 billion. Indonesia's exports to South Korea were recorded at USD 9.53 billion and Indonesia's imports from Korea were recorded at USD 9.08 billion. Of the total trade, Indonesia had a surplus against South Korea of ​​USD 443.6 million.

Indonesia's main export commodities to South Korea are coal, copper ore, natural rubber, plywood, and forged tin. Meanwhile, Indonesia's main import commodities are from
South Korea is synthetic rubber, flat iron steel products, electronic integrated circuits, synthetic filament yarn woven fabrics, and other vessels. (kemendag)

The Indonesian and Japanese governments agreed to continue to enhance comprehensive cooperation in developing efforts in the manufacturing industry sector. This strategic step is considered to be able to accelerate the economic growth of the two countries.

This bilateral collaboration was poured through the signing of a framework document between the Indonesian Minister of Industry Airlangga Hartarto and Japan's Ministry of Economy, Trade, and Investment (METI), Hiroshige Seko in Osaka, Japan, Thursday (6/27) local time. This synergy is an implementation of the New Manufacturing Industry Development Center (New MIDEC) project under the cooperation framework of the Indonesia-Japan Economic Partnership Agreement (IJEPA)

"With the cooperation of New MIDEC, it can compensate for the trade deficit between Indonesia and Japan in the form of basic capacity building for the manufacturing sector. For example, the capacity for welding techniques or other skills related to the automotive industry, "said the Minister of Industry.

New MIDEC activities include six sectors, namely the automotive, electronic, textile, food, beverage and chemical and metal industries. In addition there are also seven cross sectors, namely metal working, mold & dies (tooling), welding, SME development, export and investment promotion, green industry (energy, waste, emission), and industry 4.0 (digitalization, automation, policy reforms) .

The implementation of the New MIDEC program that can be implemented immediately after the signing is in the automotive sector by involving two cross sectors, including mold & dies (tooling) and SME development. Meanwhile, activities in other sectors will be carried out after both parties have prepared a Technical Arrangement and input from relevant stakeholders.

Through this collaboration, Airlangga is optimistic that there will be an increase in investment by Japanese investors embedded in Indonesia. For example, when the Minister of Industry met with the President of Toyota Motor Corp. Akio Toyoda in the One on One Meeting session, Toyota will develop electric-based vehicles especially hybrids in Indonesia. The plan, Toyota is ready to pour funds amounting to Rp28.3 trillion over the next four years.

"The next Toyota investment plan is related to new government policies, which are driving the development of electric vehicles. Well, that will be listed in two PPs. First, regarding the acceleration of electric-based vehicles, and the second is activities related to PPnBM for electric-based industries, which include hybrids. The PPnBM will become zero if it is based on electricity and the emission is the lowest, "he said.

The Minister of Industry said, the Ministry of Industry together with one of the Japanese automotive manufacturers, had conducted a study of the development and use of electric vehicles. This activity also involved six universities in Indonesia.

"From the results of the study, hybrids are seen as an alternative because of the well to wheel, where the ecosystem generation of energy is also seen, starting from primary energy to the automotive drivers," he explained. The Ministry of Industry itself has encouraged the development of domestic electric vehicle technology, including the making of fuel cells.

The Minister of Industry added, in attending the State-Group Summit 20 (G-20) in Osaka, it met with a number of CEOs from well-known companies in Japan. They hope that the investment climate in Indonesia will improve, which includes the guarantee of the availability of raw materials and the support of adequate infrastructure such as electricity and ports to become a force to improve the competitiveness of an industry.

"In a forum business consisting of various industries, the average large Japanese company has operated for more than 30 years in Indonesia. The sectors range from energy, electricity, pulp and paper, chemical, automotive and banking, "he said.

The Minister of Industry affirmed, the Indonesian Government will soon issue a new policy package to support the business world, by providing fiscal incentive facilities in the form of tax holidays, tax allowances, and super deduction tax for vocational and innovation.

"Besides that there are also discussed related to the banking industry. One of the topics of discussion is the existence of data centers and digital financial inclusive, which uses artificial intelligence technology. Then it was also discussed for the project prototype for smart cities, "he added.

On that occasion, Minister of Seko conveyed, one of the important automotive policies going forward was the development of battery or electric-based vehicles. So far, Japan has implemented a parallel policy for electric (EV) and hybrid bases. (kemenperin)