BOGOR (TheInsiderStories) – Indonesia and Australia will sign Indonesia-Australia Economic Partnership Agreement (IA-CEPA) in November, said one senior official on Friday (31/08). The two countries have had discussions over the six years before reaching an agreement which is marked by the signing of the declaration today.
According to Widodo, Australia is one of Indonesia’s key partners and also for the ASEAN region.
After a bilateral meeting, Morrison and Widodo witnessed the signing of four agreements namely declaration on the conclusion of the IA-CEPA, a memorandum of understanding on cooperation in the field of creative economy, transportation, national cyber and crypto agency.
Both also emphasized the importance of respecting international law and security with the signing of the cooperation in the field of security, especially related to cyber security, regional and global issues, terrorism eradication, development of the concept of Indo Pacific, as well as the Palestinian issue.
Minister of Trade Enggartiasto Lukita explained, IA-CEPA not signed today because there are still legal requirement and other administrative issues that must be resolved. However, he emphasized that contents of CEPA has been been completed and no further discussion.
“We started 6 years and after 10 years of signing an agreement with Japan, IA-CEPA is the first time we signed,” said the minister.
When CEPA is implemented, he said, Indonesia will gain the advantage of ease of export and tariff will go to 0 percent. “For beef imports would be use tariff rate quota,” he said.
Instead, Australia will ease of investment in Indonesia in the education, health and capacity building sectors. Indonesia’s interest to encourage Australian investors open educational institutions in Indonesia, because now as many as tens of thousands of Indonesian students studying in Australia.
While, the Coordinating Minister for the maritime Luhut Panjaitan stated that the various agreements signed today will be able to increase export value of Indonesia.
“For example, right now many Australian car factory closed so we could be the first priority because of the distance we close,” he said.
CEPA covers not only free trade pact in the form of goods, but also services, investment and intellectual property. The deal, which has been discussed since 2012 and was originally to be completed last year and should be signed in 2018.
Based on data from Statistics Indonesia, bilateral trade was valued at US$8.5 billion in 2017, with a deficit of $3.5 billion on the Indonesian side.