“It is now timely for us, for Indonesia and Australia, to review this IA-CEPA," Pramono stated via video at the commemoration of "Five Years of the Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA)" on Thursday (July 3).
"We expect the IA-CEPA to serve Indonesia's interests as a developing country," he added.
He explained that Indonesia should work to improve its trade position with Australia so that bilateral trade can better support Indonesia's overall trade surplus with other countries.
To achieve this, Pramono said, Indonesia needs to produce more competitive value-added products, such as garments, automotive goods, electronics, biofuels, and batteries.
The Indonesian ambassador also noted that while promoting agricultural commodities remains important, the IA-CEPA review should also help both countries enhance cooperation in critical minerals and non-semi-industries, as well as improve overall manufacturing performance.
“Australia can assist Indonesia with upscaling, transfer of technology, know-how, and knowledge to help build Indonesia's manufacturing capabilities," Pramono stated.
He expressed hope that Australia would invest more in science, technology, engineering, and mathematics (STEM) education, as well as professional training, especially to improve governance, environmental, and social (ESG) standards.
"Hopefully, in the future, we will also cover skilled labor such as nurses and caregivers," Pramono added.
He also noted that investment between the two countries has decreased slightly over the past two years, emphasizing the need for Indonesia and Australia to work harder to boost investment.
The Indonesian ambassador emphasized that the two countries must build greater trust to overcome common challenges, especially amid current geopolitical tensions.
Meanwhile, Australian Ambassador to Indonesia Rod Brazier welcomed the decision by Indonesia and Australia to review the IA-CEPA to maximize the potential of economic relations, including in new areas of cooperation.
According to Brazier, political tensions and uncertainty in international trade can impact the global economy and its implications. He also highlighted the importance of high-quality free trade agreements such as the IA-CEPA to build economic resilience.
By implementing the IA-CEPA approach, Brazier said, countries provide certainty for businesses to continue investing in each other in the region to ensure sustainable stability and prosperity.
The IA-CEPA came into effect on July 5, 2020, and since then, bilateral trade between the two countries has doubled.
Combined trade in goods and services grew from 17.7 billion Australian dollars (around 11.6 billion US dollars) in 2019 to 35.4 billion Australian dollars (around 23.2 billion US dollars) in 2024.
Currently, Indonesia exports more goods and services to Australia and recorded a trade surplus with Australia of 3.13 billion Australian dollars (around 2 billion US dollars) in 2024.
Reporter: Cindy Frishanti Octavia
Editor: Aditya Eko Sigit Wicaksono
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