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National Economic Growth Considered Promising, Australia Strengthens Trade and Investment Commitments

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The Deputy Minister of Foreign Affairs of the Republic of Indonesia, Pahala Nugraha, continues to encourage increased mutually beneficial trade and investment cooperation with Australia. This was conveyed by the Indonesian Deputy Minister of Foreign Affairs in his meeting with the Australian Deputy Minister of Trade and Deputy Minister of Manufacturing, Tim Ayres in Jakarta.

The Australian government saw the potential for cooperation with Indonesia on performance when visiting Jakarta. As a democratic country with enormous potential for economic growth, Indonesia also has a strong role in the Southeast Asia region.

The Deputy Minister of Foreign Affairs encouraged the creation of a more balanced trade balance. Therefore, the Deputy Minister of Foreign Affairs invited both countries to optimize the implementation of IA-CEPA, including by overcoming non-tariff barriers for Indonesian commodities, such as fishery products and fruit, through mutually acceptable cooperation.

Apart from that, the Deputy Minister of Foreign Affairs welcomed the increasingly rapid increase in cooperation between the two countries in the fields of critical minerals and energy. The Deputy Minister of Foreign Affairs encouraged the complementary use of the mineral resources of the two countries to support the energy transition and achieve net zero emissions, including ensuring fair share for Indonesia.

Australia’s Assistant Minister for Trade  , Tim Ayres, said Indonesia is home to more than 270 million people and will become one of the largest economies in the world by 2040. Australia is well positioned to be part of this growth.

He believes that Australia will fully cooperate with Indonesia to realize its economic potential, as well as support the trade diversification of our exporters in important markets.

Deputy Minister of Trade, Jerry Sambuaga said that Indonesia and Australia had made progress on a memorandum of understanding on cooperation on electric vehicles and batteries. Meanwhile, the task of the two governments is to diversify, strengthen supply chains and production processes.

Australia is ASEAN’s strategic partner in the fields of trade and investment. This is to encourage ASEAN economic growth. They claim to be able to contribute their expertise and abilities, especially in renewable energy, agriculture, mining, and their country has a strong investment record in Indonesia in the fields of higher education and health.

During the meeting, the Australian Deputy Minister of Trade also socialized Australia’s Southeast Asia Economic Strategy To 2040, which was launched by the Australian PM on 6 September 2023 on the sidelines of the ASEAN Summit in Jakarta.

Through this strategy, Australia will strengthen economic engagement in the region, especially in several priority sectors such as food and agriculture, green energy, infrastructure, digital economy, health and education. In this case, the Indonesian Deputy Minister of Foreign Affairs encouraged this strategy to be synergized with existing mechanisms in ASEAN such as in the fields of digital economy and energy transition.

On the other hand, Australia also gave various praises for the resilience of the Indonesian economy, which is recognized as a leader in ASEAN, and is the reason for supporting RI’s membership in the OECD. Australia and Indonesia face current global challenges, such as the risk of inflation starting from Russia’s invasion of Ukraine.

However, it turns out that the Indonesian economy has strengthened more than expectations. And the Asean region is the fastest growing region in human history and has enormous growth potential.

Indonesia is considered to have set ambitious targets for economic growth. This is considered to be an opportunity for Australia to work together to achieve this goal. Indonesia has economic potential and a large role in the Asean region. This is the reason Australia supports Indonesia’s membership in the Organization for Economic Cooperation and Development (OECD). 

Australia wants Indonesia to play a strong role, and also has the right to play a role in world affairs. Ayres’ visit to Indonesia was carried out to strengthen his commitment to trade and investment with Indonesia. His party will look at the potential for cooperation in Indonesia, which is driven by the potential for Indonesia’s economic performance.

Previously, President Jokowi confirmed that Indonesia was the best partner for investing in the Southeast Asia region. A number of priority sectors in Indonesia have high potential for Australian investors to invest in Indonesia.

Thus, it is hoped that economic cooperation between Indonesia and Australia will bring many benefits. Through this collaboration, apart from increasing trade and opening access to the Australian market for Indonesian products, it will also increase investment, attracting the flow of foreign direct investment (FDI) from Australia which will later be able to create jobs and encourage economic growth.

Bilateral cooperation between Indonesia and Australia on the economic aspect will have an impact on involvement in other strategic fields. For example, the IA-CEPA and CSP agreements are the basis for expanding collaboration in the education, research and development sectors. The transfer of technology, expertise and knowledge from Australia to Indonesia is a positive impact of this collaboration. Apart from that, the tourism sector is also a focus, where increased cooperation is expected to support the growth of the tourism industry in both countries.

Overall, economic cooperation with Australia helps Indonesia achieve its national development goals, such as increasing economic growth, reducing poverty and improving people’s welfare.

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