Coordinating Minister for the Economy and Trade Zulkifli Hasan said in Jakarta on Wednesday that the CEPA framework could help reduce trade barriers and logistics costs, as Indonesian products can enter the UAE duty-free.
He said the approach could serve as an interim mechanism while Indonesia continues direct negotiations with Saudi Arabia on market access for ready-to-eat food products.
"The agreement with Saudi Arabia is not yet completed. But we already have a CEPA with the UAE. Shipments to the UAE are duty-free, and from there they can be forwarded to Saudi Arabia," Hasan stated.
However, he noted several challenges, particularly regulations and food safety standards set by Saudi Arabia’s food and drug authority. Hasan has therefore instructed the National Food and Drug Agency (BPOM) to coordinate with its Saudi counterpart to remove technical trade barriers.
"We have decided that BPOM must immediately communicate to eliminate these barriers for food trade. Whether for ready-to-eat products or fresh foods. Some items are allowed, others are not," he emphasized.
Hasan added that routing shipments through the UAE could help reduce Hajj operational costs, especially food logistics, which form one of the largest expense components.
He said Indonesia has an economic potential of up to Rp60 trillion (around US$3.6 billion) from supplying food for Hajj and Umrah pilgrims, a market currently dominated by foreign suppliers.
The government is preparing measures to enable Indonesia to begin supplying food needs for the pilgrimage and gradually expand capacity in line with the domestic industry's capabilities.
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Translator: Maria Cicilia, Kuntum Khaira Riswan
Editor: Anton Santoso
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