JAKARTA (TheInsiderStories) – Indonesia and South Korea have signed a preliminary agreement on the Comprehensive Economic Partnership Agreement (CEPA) at Trade Expo Indonesia, Tangerang, today (10/16). While, with United Kingdom (UK) signed the Terms of Reference (TOR) of the Trade Review.
The signing of the the agreement was carried out Indonesian minister of trade Enggartiasto Lukita and South Korea’ minister of commerce, industry and energy Yoo Myung Hee witnessed by Vice President Jusuf Kalla. While, the the director general at the ministry Iman Pambagyo and UK’ trade commissioner for Asia Pacific, Natalie Black signed the TOR of the Trade Review witnessed by Lukita.
The minister explained, both countries plan to officially strike the CEPA in the first half of 2020. IK-CEPA negotiations were completed substantially at the 10th round of meetings held in Bali on Oct. 7 – 10.
“In the midst of the current global economic uncertainty, Indonesia and South Korea are in need a breakthrough to encourage trade and investment between the two countries. This expected to boost the value of trade between the two countries and South Korean investment in Indonesia,” said Lukita.
Through IK-CEPA, he revealed, Indonesia will later get better market access for products industry, fisheries, and agriculture in the South Korean market. On the other hand, Indonesia will provide market access to industrial raw materials, facilitating South Korean investment in Indonesia, he adds.
IK-CEPA negotiations began in 2012, but were briefly stopped in 2014. Then in February 2019, the two countries agreed to continue negotiations and targets Settlement negotiations before the end of 2019.
“According to the plan, the completion of this agreement is expected to be announced by the two heads countries in November 2019 on the sidelines of the 30th ASEAN-Korea Commemorative Summit at Busan, South Korea,” adds by the minister.
While Pambaguo added, currently Indonesia and South Korea are parties to several forums Other negotiations, namely the ASEAN-Korea Free Trade Agreement (FTA) and Regional Comprehensive Economic Partnership.
“However, we see opportunities where Indonesia and South Korea can cooperate more closely and broadly bilaterally through IK-CEPA negotiations. This is one of our steps in commitment to achieving the target trade value the two countries amounted to US$30 billion in 2022,” he asserted.
Based Statistic Indonesia data, in 2018, South Korea is the 6th largest export and import source for the country with the second total trade value the country reached $18.62 billion. Indonesia’ total exports to South Korea were $9.54 billion and total imports from South Korea were recorded at $9.08 billion. With this value Indonesia has a surplus of $460 million.
The country’ main export commodities to South Korea are coal, copper ore, natural rubber, plywood and tin. While Indonesia’ main import commodities from South Korea are synthetic rubber, sheet steel products, electronic products, and synthetic filament woven fabrics.
South Korea is striving to sign FTAs with Malaysia and the Philippines at the end of the year when the South Korea – ASEAN summit is slated for November in Busan. If all the negotiations under way are successful, the country will have free trade deals with all the five of its top ASEAN trading partners.
With UK, the two of the largest economies and members of G20, have an opportunity to renew and develop stronger economic ties. The Trade Review is a collaboration between Indonesia and the UK to assess the current state of our bilateral trade and investment relationship, as well as looking to identify possible opportunities to enhance bilateral cooperation for the future.
The Review will be based on empirical analysis and engagement with various stakeholders, including businesses operating in both countries. It will result in a joint report which will include recommendations to both governments.
The first formal meeting of the Trade Review will be held in December 2019 in London, said the UK’ trade commissioner.
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