"The establishment of the negotiation was carried out by the two countries with the awareness and hope that the establishment of the ICA-CEPA can provide various benefits of trade and investment opportunities for business actors from both countries as a whole," Lutfi said while making an official statement following the virtual launch in Jakarta on Monday.
The launch of the ICA-CEPA marks a milestone in the 69-year Indonesia-Canada relationship, he added.
The agreement is expected to support economic growth, trade and investment, and create jobs for the people of the two countries, Lutfi said.
The effort is part of strategies for strengthening foreign cooperation relations between Indonesia and Canada as important and strategic equal partners, especially in the midst of a very dynamic global geopolitical change, the trade minister noted.
"This step is a follow-up to President Joko Widodo’s directive so that Indonesia actively forms international trade negotiations with potential trading partners in order to open up new market opportunities, especially to create export opportunities in the midst of a pandemic," Lutfi said.
The agreement is a strategic effort to open up opportunities for greater penetration of Indonesian products in North America, considering that it currently has just one trade agreement in the Americas, namely with Chile in South America, he observed.
Meanwhile, director general of international trade negotiations, Djatmiko Bris Witjaksono, revealed that Lutfi and Ng have directed their negotiating teams to look into technical matters before negotiations start. The first round of negotiations is planned to take place before the end of 2021.
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"We have started a series of initial coordination steps with all ministries and institutions to prepare for these negotiations based on three main principles, namely market access, facilitation rules, and cooperation," Djatmiko said.
During the first quarter of this year, the two countries conducted a series of online discussions on a wide range of potential issues regarding the agreement, he informed.
The issues discussed by the two nations included market access for trade in goods, trade in services, investment, economic cooperation, including various other trade-related areas that will be further considered by the two parties during negotiations, he elaborated.
"The government hopes that with ICA-CEPA, Indonesia can increasingly compete with neighboring countries in the Southeast Asia region that have previously had trade agreements with Canada, or who have joined the Trans-Pacific Partnership Trade Agreement (CP TPP)," Djatmiko said.
Based on data from the Central Statistics Agency, processed by the Ministry of Trade, Canada ranks 32nd among Indonesia's export destinations and 16th as a source of Indonesian imports, with total trade pegged at US$2.4 billion in 2020.
During the period, Indonesia's total exports to Canada were recorded at US$789.1 million. Meanwhile, its imports from Canada stood at US$1.6 billion.
In the last five years, Canada has invested US$718 million in Indonesia’s mining, hotel and restaurant, as well as logistics sectors.
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