Australia warned of further repercussions

Australia warned of further repercussions

SINGAPORE (AFP): Indonesia's Trade and Industry Minister Rahardi Ramelan has accused Australia of mixing politics with trade and warned that Jakarta might expand a campaign to cut its commodity imports from Australia.

He charged on the sidelines of Southeast Asian trade ministers' talks which opened here Thursday that Australian unions which staged a boycott of Indonesian cargo over the East Timor crisis sparked off the trade problem.

"They are boycotting and hindering trade and the Indonesian business and industry have to make a decision because they want to have continuity (in supplies)," Rahardi told reporters on the eve of the Association of Southeast Asian Nations (ASEAN) talks.

He said that Indonesian business groups had come to him concerned about the disruption of imports from Australia following the boycott and he had told them: "Please safeguard your sources. Don't depend on one country."

Rahardi said so far Indonesian associations representing wheat and cotton importers had approached the government to seek alternative sources of supply. He indicated that sugar importers would follow suit.

"Until today, wheat and cotton. For sugar, I am sure they will come to us also," he said.

Australian Trade Minister Mark Vaile on Wednesday played down concerns that Australian imports to Indonesia could be cut back over the government's stance on East Timor, where Australian troops are leading a UN force assigned to restore order.

Vaile said Jakarta had been concerned its exports could be disrupted because of union blockades in Australia, but they were lifted when Indonesia agreed to allow UN peacekeepers into East Timor.

Rahardi said Indonesia would not face problems if Australia held back its exports and repeatedly stressed that "it is a buyers' market."

He said that for wheat particularly, there were abundant supplies including from China and India. "As long as it is a buyers' market, it's no problem.

Asked how he could help restore trade ties, Rahardi said: "It is really the decision of the Indonesian people, including the business (sector), and how they judge, how they value the relations with Australia.

"In Australia, the problem is the society. (There is) sensitivity (on the trade front) because of politics. Politics and trade should not be mixed."

The minister said 60 percent of Indonesia's wheat imports and 40 percent of cotton imports came from Australia.

Two-way trade between Australia and Indonesia is worth about A$5.5 billion (US$3.52 billion) annually but the Indonesians enjoy a A$1.4 billion trade surplus, largely due to Australian imports of crude oil and petroleum products.

The surplus was the first recorded by Indonesia since early 1990s.

Indonesian officials said Australia's Vaile had sought a meeting with Rahardi on the sidelines of the ASEAN meeting here but it could not be arranged because Rahardi had to return home for a meeting of Indonesia's highest legislative body, the People's Consultative Assembly (MPR).

The MPR kicks off a general convention Friday that will lead to the selection of the country's new president in November.

Vaile was scheduled to attend a meeting Friday of trade ministers from ASEAN with their counterparts from Australia and New Zealand as part of an annual exercise.