Australia and RI promise more incentives for AIDA

Australia and RI promise more incentives for AIDA

By Riyadi

AMBON, Maluku (JP): Indonesia and Australia launched the
Australia-Indonesia Development Area (AIDA) here yesterday.

AIDA is a sub-regional economic zone linking northern
Australia with eastern Indonesia.

Indonesia's coordinating minister for production and
distribution, Hartarto, and Australia's minister of foreign
affairs, Alexander Downer, launched the zone.

At the first AIDA ministerial meeting Hartarto and Downer
pledged to provide incentives and aid to encourage business
activities in northern Australia and eastern Indonesia.

They said AIDA's main aim was to provide the private sector
with a good business climate.

They said AIDA needed to become as attractive investment place
as anywhere else to ensure long-term results.

"This is a win-win, complementary cooperation," Hartarto said
after the one-day ministerial meeting.

Downer said AIDA should enhance Australian firms'
profitability, create more jobs for Australians and benefit firms
and people in eastern Indonesia.

"So, there is absolutely no doubt in my mind that we should
contribute to the economic development of eastern Indonesia ...
because we want to see a more prosperous eastern Indonesia in the
interest of broader stability in the region," Downer said.

The meeting set up six sectoral working groups for
agriculture, fisheries and animal husbandry, education and
training, mining and energy, tourism, transport, plus trade and
industry.

Hartarto said Indonesia gave AIDA equal status as other sub-
regional economic zones it was involved in through ASEAN like the
Indonesia-Malaysia-Singapore Growth Triangle and Indonesia-
Malaysia-Thailand Growth Triangle.

Indonesians from AIDA regions traveling to Australia will be
relieved of fiscal clearance.

"All facilitations given to sub-regional cooperation within
ASEAN will be given to AIDA. The question is whether this is
sufficient or not, and that is what I'm thinking now," Hartarto
said.

Indonesia would look at what policy changes were needed to
cover Australians holding temporary residence permits, he said.

"I'm pleased to announce that Indonesia undertakes to increase
air services between Indonesia and Australia and in particular
within AIDA and to explore the development of new air routes by
Indonesian and Australian airlines," Hartarto said.

Visa-free short-term entry to Indonesia for foreigners from
specific countries, including Australia, would soon be available
at all AIDA international ports and airports, Hartarto said.

He said the government would review policies and procedures on
expatriate work permits to attract qualified Australians to
assist private sector business cooperation within AIDA.

To facilitate trade Indonesia had approved in principle to
computerized customs services at certain AIDA ports, especially
those with heavy international loads, he said.

Hartarto invited Australian investors to take advantage of the
fiscal incentives available for investment in eastern Indonesian
growth centers.

Downer said Australia would open two honorary consulates
within the AIDA area to facilitate business activity and the
movement of people.

Australia, through the Australia Agency for International
Development (AusAID), would fund a major study of eastern
Indonesia focusing on identifying opportunities and challenges to
trade and investment, he said

Australia would also contribute to a feasibility study into
the establishment of a World Bank International Finance
Corporation office in eastern Indonesia, he said.

"This office would provide technical assistance to private
firms to develop bankable investment project proposals," Downer
said.

Australia's Department of Employment, Education, Training and
Youth Affairs, will fund a pilot project on mining competency
standards and fund the introduction of competency standards for
tourism in Indonesia.

Australia had also set up a technical and vocational education
development assistance for Indonesians, especially those from
eastern provinces.

An Ausaid deputy director-general, Peter McCawley, said AusAid
had allocated A$25 million for the technical and vocational
education assistance, A$225,000 for the study on opportunities
and challenges in AIDA and A$130,000 for the feasibility study
into the establishment of an International Finance Corporation
office.

AIDA will have a three-tiered meeting structure -- sectoral
working groups will give inputs to periodic meetings of senior
officials which will report to the annual ministerial meeting.

The next ministerial meeting will be held back-to-back with
the Australia-Indonesia ministerial forum in Australia next year.

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