The Australian Prime Minster Scott Morrison this week attended Indonesian President Joko Widodo’s (Jokowi) inauguration, which marks the beginning of his second five-year term. During a meeting at the presidential palace, the leaders reiterated their support for the Indonesia-Australian Comprehensive Economic Partnership Agreement (IA-CEPA), as both sides inched closer to ratification of the deal.
The discussion that now follows in the Indonesian parliament will be influenced by key appointments in Jokowi’s new cabinet, due to be announced in coming days. It appears they will be voting on the Indonesia-Australia free trade deal that could also have been passed by presidential degree.
Australia and Indonesia signed the IA-CEPA in March this year. As one of the fastest growing economies in the Indo-Pacific, Indonesia presents a significant opportunity for Australian businesses. By some estimates, Indonesia will be the world’s fifth-largest economy by 2030, and the IA-CEPA ensures that Australia is well-placed to strengthen economic cooperation and share in Indonesia’s growth.
Australia also moved one step closer to ratifying the Indonesian Free Trade Agreement (FTA) after the opposition Labor Party indicated its support, saying it would be good for jobs, deflecting criticism they received from the union movement for supporting free trade deals with Indonesia, Peru and Hong Kong.
Indonesia is building a new capital city, which should generate jobs for Australian infrastructure companies, for Australian steel, for Australian engineers, Australian architects, Australian planners, Australian legal officers and service deliverers, including transport and forwarding. As a result of this agreement, which will see on the one hand, 2% of Indonesian goods and services into Australia become tariff free and, in return, 25% of Australian goods and services into Indonesia being tariff free.
Colless Young has well established representation in Indonesia. As your licensed Customs Brokers and international freight forwarders, we offer you professional guidance on all your import, export, shipping and trade requirements.
