Indonesia and Turkey agreed to finalize the Indonesia-Turkey Comprehensive Economic Partnership Agreement (IT-CEPA) negotiations this year - Photo: Trade Ministry.

JAKARTA (TheInsiderStories) – Indonesia and Turkey agreed to finalize the Indonesia-Turkey Comprehensive Economic Partnership Agreement (IT-CEPA) negotiations this year, which is expected to overcome obstacles and encourage increased trade performance of the two countries.

The total trade between the two countries in 2018 was recorded at US$ 1.79 billion, rose $9 billion from 2017 which was valued at $1.70 billion. Last year, Indonesia won a surplus of $634.9 million with an export value of $1.81 billion and imports of $611.5 million.

Meanwhile, for the January – April period the total trade between the two countries reached $503.7 million with Indonesian exports amounting to $381 million and imports of $122.7 million, trade ministry data showed.

Minister of Trade Enggartiasto Lukita,  who hold the bilateral meeting with Turkey’ trade minister Ruhsar Pekcan in Ankara on Friday (07/12) explained that the government is targeting Turkey as the new export hub to reach markets in the Middle East, South Europe, and North Africa regions.

“Indonesia and Turkey view each other as potential hubs to reach the market in each area. Indonesia, for example, may use Turkey as the gate to enter the Middle East, South Europe, and North Africa markets,” he said in an official statement.

Turkey, on the opposite, can make Indonesia a base for entering the ASEAN market of 600 million people as well as the Regional Comprehensive Economic Partnership or RCEP Region of 3.5 billion people. To that end, both parties hope that the CEPA currently being negotiated can be an incentive to encourage not only trade between two countries but also a mutually beneficial two-way investment.

Two ministers also agreed to assign the two negotiating teams to start increasing contacts to prepare for the fourth round of negotiations planned for October. These preparations include conducting a teleconference between Jakarta and Ankara starting in August to ensure that the two teams are ready to register progress before the end of 2019.

In the meeting, Lukita also expressed a request that Turkey is more selective in implementing trade security measures (anti-dumping, anti-circumvention, and safeguards). The minister, among other things, proposed that correspondence in the investigation process be carried out in English, and anti-dumping and other trade safeguards currently imposed on Indonesia could be terminated if they had entered the age of 10 years.

“The Turkish trade minister stated that his trade security policy was in accordance with the provisions of the WTO, but after we explained a number of difficulties faced by Indonesia in the investigation process, the Minister agreed to assign his team to discuss this in the context of the CEPA negotiations,” Lukita added.

Meanwhile, the Indonesian Ambassador in Ankara, Lalu Muhamad Iqbal, will facilitate the communication with the Turkey side in relation to push the IT-CEPA completion or to report the trade obstacles faced by Indonesia in Turkey’s market to the Trade Minister in Jakarta.

Iqbal explains that Indonesian products are very competitive in Turkey’s market, adding that the improving economic performance of Indonesia has attracted businesses in Turkey to cooperate with Indonesia either in trade sector or investment.

“If it’s realized, the CEPA between the two countries could push up each of its trade values and support the two-way investment,” Iqbal remarks.

Written by Lexy Nantu, Email: lexy@theinsiderstories.com