Australian council sees trade with RI falling

Australian council sees trade with RI falling

CANBERRA (Dow Jones): The Australia-Indonesia Business Council
said Wednesday trade between the two nations likely will decline
in the wake of the terror in East Timor since the pro-
independence vote August 30, Philip Hawke, acting president of
the council, said.

"The relationship between Australia and Indonesia has been
destroyed and that will affect business," even though business
relations haven't noticeably deteriorated, Hawke told Dow Jones
Newswire.

"We would expect trade figures to decline," he said. "Our
feeling at the moment anyway is that there is a very real
reluctance amongst Australians to get involved in trade with
Indonesia. We are seeing that in withdrawals from membership of
our council and we are beginning to see people say, 'No I won't
go there, if I'm going to go overseas I'll go to Thailand or
Malaysia.'"

He cited an expected downturn in Australian cotton exports to
Indonesia in particular.

Hawke also said in a statement that worsening relations with
Indonesia aren't in Australia's interest and can't be allowed to
continue.

Australia must redevelop relations with Indonesia and ensure
trade restarts as well, following trade union work bans on
vessels plying the Indonesian trade and on Garuda, the national
airline.

Indonesia was Australia's 10th largest trading partner in 1998
with two-way trade of A$5.71 billion.

Australian exports totaled A$2.15 billion, with big-ticket
items being cotton, wheat and mineral products.

Indonesian exports to Australia totaled A$3.56 billion in
1998, with major items being crude oil, gold for refining and re-
export and jewelry.

Hawke said Indonesian exports to Australia jumped in 1998,
partly reflecting the influence of a weak rupiah and the export
drive associated with the economic downturn. In 1996 these
exports totaled A$1.71 billion.

The Australia-Indonesia Business Council, which has 500
members, also supported a statement Sept. 17 from its Indonesian
counterpart that some negative reactions in Indonesia to
Australia aren't representative.

The council said, "The actions of the current Indonesian
government and the atrocities committed by the pro-integration
Indonesian militias in East Timor aren't condoned by the vast
majority of Indonesian people."