The visit is expected to gain concrete results including in completing early stage negotiations on the Comprehensive Economic Partnership Agreement (CEPA) between Indonesia and the European Union (EU), according to Trade Minister Thomas Trikasih Lembong following a limited cabinet meeting led by Jokowi to discuss the preparation of his European tour in Jakarta, April 16.
When the CEPA is realized, Indonesia would gain access to the markets in EU that comprises 28 member countries with a total population of 530 million and an economy of US$ 18.5 trillion per year.
Besides, the visit is also expected to boost foreign direct investment from Europe to Indonesia, according to the Investment Coordinating Board (BKPM).
Europes investment potential was quite huge, but Indonesia had yet to optimally benefit from it, Franky Sibarani, the BKPM chief, noted in a statement.
The realization of investment from Europe reached Rp149.8 trillion during the 2010-2015 period, he remarked, hoping that the Presidents upcoming visit would boost European investment in Indonesia.
Several cabinet ministers will accompany the President during the visit, according to Sibarani.
In every country, the head of state and his entourage will attend a business forum, which is expected to draw some 200 to 250 businessmen, Sibarani who left for Europe on April 16, remarked.
The total investment from the four European countries reached Rp106.8 trillion during the 2010-2015 period, according to the BKPM data.
Meanwhile, the total value of the EU investment in Indonesia amounted to $2.26 billion. Europe, as a whole, is ranked third among the major foreign investors in Indonesia.
The Netherlands, with a total investment worth Rp70 trillion, is ranked seventh; Britain, with Rp31 trillion, came tenth; Germany, with Rp5.2 trillion, stood 17th; and Belgium, with Rp1.6 trillion, ranked 27th, he revealed.
Investment from those European countries in Indonesia had yet to reach an optimal level, Sibarani believed.
The investment commitment of European nations to Indonesia in January 2016 reached Rp6.53 trillion, up tenfold from Rp670 billion in January 2015.
In 2015, the European investment commitment increased 16 percent to Rp37.3 trillion from Rp32.2 trillion in 2014.
Indonesia will establish cooperation with some European companies in several areas, Minister of State Owned Enterprises (SOEs) Rini Soemarno said earlier.
President Joko Widodo is scheduled to visit the European Union Headquarters in Brussels, Belgium, on April 19, 2016, the minister said.
"The government will establish cooperation with Siemens for education and development of local content, and with Rolls Royce for engine maintenance services. In addition, PT Antam (a mining company) will also partner with Ferrostaal for processing ferronickel into stainless steel," Rini explained.
Currently, the EU is the fourth-largest trading partner of Indonesia with trade value reaching US$26.14 billion in 2015. Of this, Indonesias surplus amounted to $3.02 billion, slightly down from $4.21 billion surplus in 2014.
Indonesias main exports to the EU countries include machinery, motor vehicles, pharmaceuticals and oil fuel.
In early April, Vice-President of the European Commission Federica Mogherini visited Jakarta and paid a courtesy call on President Jokowi on April 8 to discuss a number of issues, including ways to expand cooperation in the economic sector between Indonesia and the European Union.
"The European Union is one of Indonesias traditional partners for trade, investment and tourism," Indonesian Foreign Minister Retno Marsudi, stated.
"In the context of trade and investment, a lot of opportunities remain to be explored," she said.
Around a million tourists from the EU countries visited Indonesia in 2015.
From the point of view of the EU, Indonesia is a key partner in a key region, Federica Mogherini, who is concurrently the High Representative of the EU, said in her remark at the Joint Press Conference with Retno Marsudi.
"It is our firm intention to work in a systematic and continued way to explore all the potential that is there for further cooperation in all different sectors. For trade and investment, I can confirm that we can build on the good work that has been done so far to cover the last mile and to move to important steps in the upcoming weeks," she said.
She lauded the upcoming visit of President Jokowi to Europe, including to the EU Headquarters in Brussels, Belgium.
"That would be the first ever visit of an Indonesian President to the European Union institutions and that would for sure highlight the new, upgraded level of our strategic cooperation," the Italian official said. ***3***
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Reporter: Fardah
Editor: Fardah Assegaf
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