Australia vows to promote trade with Indonesia

JAKARTA (JP): Australian Deputy Prime Minister/Minister for Trade Tim Fischer made it clear yesterday that his government will not change its policy toward Indonesia and will further promote bilateral trade.

Speaking at a breakfast meeting hosted by the Indonesia- Australia Business Council yesterday, Fischer pointed out that his new coalition government is unequivocally committed to the development of closer economic ties with the Asian region, including Indonesia.

"I believe that this commitment is reflected in the fact that both Mr. Downer and myself have made Asia our first port of call as we commence overseas activities associated with our respective portfolios," he said in reference to Australian Foreign Affairs Minister Alexander Downer.

He noted that his coalition government needs to do a lot more to make Australia one of the truly dynamic Asia-Pacific economies.

"The government has started by moving quickly to get macroeconomic policy back on course," he said.

Measures that will revitalize and deepen micro-economic reform and improve Australia's competitiveness are on the drawing board, he said. "Our priority areas include labor market reform, the waterfront, communications, transport and energy."

With respect to economic links with Indonesia, Fischer said that Australia's domestic economic policy will be key to developing bilateral ties.

He said that Indonesia is also going down a similar path of economic reform to boost its trade and investment performance.

"President Soeharto's government has a remarkable record of effective economic management and has sustained an equitable economic growth. It has embarked resolutely on the challenging task of trade liberalization and economic deregulation," he said.

Saying that President Soeharto has played a key leadership role in the APEC (Asia Pacific Economic Cooperation) forum, he noted that Indonesia's domestic economic approach is reflected in its commitment to the regional economic grouping and its principles.

Expansion

Asked about Australia's intention to increase trade relations with Indonesia, he said, "We'll particularly expand in the sector of services that include insurance and tourism."

Indonesia saw its trade deficit with Australia increase from US$1.1 billion in 1994 to $1.4 billion last year. During 1995, its exports to Australia reached only US$0.4 billion, while imports from Australia amounted to $1.8 billion.

The chairman of the Indonesia-Australia Business Council, Sabam Siagian, said that the trade deficit is not a serious one and can be tackled if Indonesian businesses are more active in entering the Australian market.

"I noticed that there is an impression among our businessmen here that the Australian market is restricted. They don't see the potential of the country's population. Although their number is only 18 million, they have a per capita income of $16,000," he told The Jakarta Post.

Sabam, who was a former Indonesian ambassador to Australia, added that Australia's high per capita income presents an opportunity for Indonesia to market its goods there.

"There are many opportunities for us. But of course we have to improve things like quality and on-time delivery," he noted.

He acknowledged, however, that there are still barriers preventing Indonesia from benefiting from the Australian market.

He cited the quarantine procedure as one example.

"Sometimes it is an obstacle to our food products. But it can be tackled," he said. (13)