Talks on possible cooperation in the oil, gas and other energy sectors will provide the main focus for a South Korean trade delegation that will visit Indonesia next week.
South Korean ambassador to Indonesia Lee Sun-Jin said Thursday in Jakarta that between 70 and 90 of the 190 delegates taking part in the trade mission were interested in discussing potential cooperation in the energy and mineral sectors.
Led by the South Korean commerce, industry and energy minister, the delegates will meet senior Indonesian officials, including the coordinating minister for economy, energy and mineral resources minister and state-owned enterprises minister, during their three-day visit from April 30 to May 2.
With its lack of energy and natural resources, South Korea is highly dependent on imports, partly from Indonesia, to meet its energy needs.
South Korea's LNG imports from Indonesia account for about 30 percent of its total LNG requirements. The country also imports 13.1 percent of its coal from Indonesia, 4.6 percent of its crude oil, 12.4 percent of its timber, 22 percent of its rubber, 26 percent of its pulp and 29.2 percent of its copper.
Talks on the future of LNG imports from Indonesia will also be high up on the agenda given that the Indonesian government is considering reducing its LNG exports in order to meet growing domestic demand.
"We have not yet received any information from the Indonesian government about its plan to reduce LNG exports. In fact, so far we don't see any problems regarding the two countries trading relationship. We are aware that there are some problems with Japan, but not with us," Lee said.
He added that the delegates would discuss the matter in detail during their three days in Indonesia.
The South Korean delegation will consist of 130 representatives of state-owned enterprises, 40 state officials and 20 representatives of private-sector firms.
Lee said that the visit was a follow up to the joint declaration on the creation of an extensive strategic partnership, which was signed by South Korean President Roh Moo-hyun and Indonesia President Susilo Bambang Yudhoyono last year.
However, unlike the areas covered by December's agreement, this time the two sides will focus on an additional sector -- research and development -- besides the other seven sectors -- policy support; trade, investment and technology; the forestry and marine industries; energy and natural resources; infrastructure and construction; information technology; and the defense sector.
Lee said he was optimistic that the visit would be successful as the two countries had already established task forces to convert the joint declaration into concrete action.
The South Korea task force comes under the auspices of the Korean Commerce Ministry and the Korean Chamber of Commerce, while the Indonesia team is led by the coordinating minister for the economy and the Indonesian Chamber of Commerce and Industry.
Figures from Bank Indonesia show that South Korea's foreign direct investment amounted to US$650 million in 2006, up from $420 million in 2005.
South Korea is Indonesia's fifth largest trading partner, while Indonesia is Korea's ninth largest trading partner, with the two-way trade volume amounting to $13.6 billion in 2006, representing an increase of 2.7 percent from the $13.23 billion recorded in 2005.
Bilateral trade in 2006 produced a surplus in Indonesia's favor of about $3.8 billion.