Indonesia`s economic diplomacy to target Latin America, East Europe

Indonesia`s economic diplomacy to target Latin America, East Europe

Deputy Foreign Minister AM Fachir. (ANTARA PHOTO/Widodo S. Jusuf)

Jakarta (ANTARA News) - Indonesia`s economic diplomacy will target Latin America and Eastern Europe, after previously successfully cooperating with Africa.

"We have a sufficient strategy, which is equally important to facilitate business people with ease in terms of tariffs," Deputy Foreign Minister AM Fachir said after a press conference on the implementation of the World Creative Economy Conference (WCCE) in Jakarta on Tuesday.

The Ministry of Foreign Affairs has conducted an independent study of the potential and opportunities for economic cooperation in Latin America, and one of its objectives is to increase the volume and quality of Indonesian trade.

Economic diplomacy is directed at exploring the potential of non-traditional markets and alternative markets for Indonesian products.

Foreign Minister Retno Marsudi in the 2017 annual press statement set the Latin American region as one of the priority areas for increasing trade and investment cooperation.

She outlined the Latin American region consisting of 33 countries and with a continental area of 42 million square km. The population comprises 634 million (2015), of which 60 percent is concentrated in three countries, namely Brazil, Mexico and Colombia.

Latin America`s total GDP in 2015 was more than 5.3 trillion US dollars. Besides this region, there are three economies that are included in the G-20 group, namely Brazil, Mexico and Argentina.

The value of Indonesia`s trade growth trend to Latin America year on year fell by 2.57 percent, while Indonesia`s non-oil and gas export deficit was 1.82 billion US dollars in 2015.

As an effort to improve competitiveness, the Ministry of Foreign Affairs also encourages more preferential trade agreements (PTA) through bilateral and group forums, as Indonesia has done in the Economic Community forum of West African States (ECOWAS).

According to the Deputy Minister, Indonesian diplomacy in principle facilitates foreign business actors who want to enter Indonesia and, at the same time, widen the expansion of Indonesia`s economic potential abroad.

Previously, Indonesia had succeeded in organizing the Indonesia-Africa Forum, which resulted in an economic agreement worth 586 million US dollars and opened up the potential for economic cooperation worth 1.3 billion US dollars.

Through the forum, officials and businessmen from Africa began to look at Indonesia as a business partner, one of the areas being the field of connectivity.

"We have a new hub in Africa, namely in Addis Ababa, through cooperation with Ethiopian Airlines. We are exploring that Ethiopian Airlines can bring Indonesian commodities to Africa," Fachir explained.

While in the construction sector, PT Wijaya Karya (WIKA) has signed a contract for the renovation of the Niger Presidential Palace with a value of 20 million euros.

Besides BUMN, the Ministry of Foreign Affairs also supports private participation in economic cooperation with various countries, and encourages the role of the Indonesian Export Financing Agency (LPEI) or Indonesia Eximbank to assist in terms of financing.

"We will continue to do this. Of course, the Ministry of Foreign Affairs is more on the aspect of diplomacy while continuing to encourage the perpetrators," said Fachir.

Reporting by Yashinta Difa Pramudyani
Editing by Eliswan