Bilateral economic and trade ties

Bilateral economic and trade ties

Trade

Indonesia has been a major Asian trading partner for France
for a long time, and despite the deep economic and monetary
crisis affecting Indonesia since mid-1997, French companies have
confirmed their commitment to the Indonesian market. (see
ambassador's message)

This situation is expected to persist in the coming years, in
line with a gradual increase in our Indonesian imports.

The main areas for French exports are semi-products (48
percent), including chemicals (19 percent) and electrical
components (12 percent).

During the 1997-2000 period, the economic crisis strongly
affected French exports, which decreased by 71 percent in value
(the drop was mostly registered in the equipment goods sector
where France has a strong position).

However, in line with the recovery registered in Indonesia
since January 2000, our exports have increased by 17 percent last
year.

Year 2000 confirms the stronger trade relations with
Indonesia, which accounts for nearly 2 percent of our exports
outside the European Union.

The first figures for 2001 show a continuation of this
positive trend with a new increase of more than 45 percent.

Indonesian exports to France have strong positions in consumer
goods: textiles/garments and leather products (27 percent),
furniture (24 percent), and agricultural and food products (12
percent).

Last year, Indonesian exports to France have steadily
increased by 20 percent.

(Data in the form of graph to be placed here - bsr)

Economy, finance

The financial cooperation between the two countries has been
initiated in the early 1970s, reflecting the policy of the French
government to promote economic links between our two countries.

In the last 30 years, 2.5 billion Euro has been committed to
finance over 300 projects of development in the following
sectors: power generation and transmission, TV and
telecommunications, water treatment, airport and railway
infrastructure, agriculture and health.

With the crisis affecting the implementation of new
infrastructure projects, the French government has confirmed its
commitment to continue its financial cooperation with Indonesia
through its participation in the international financial
institutions as well as on a bilateral basis.

French aid to Indonesia is, however, being adapted to the
social priorities created by the economic conditions, focusing on
health, agriculture and fishery project, while major
infrastructure projects already committed are being continued in
the railway sector, civil aviation safety equipments, irrigation,
energy and water treatment and distribution sectors, tourism and
service industries.

On the international level, France is participating in the
International Monetary Fund (IMF), World Bank and Asian
Development Bank assistance program to Indonesia.

As a member of the group of official creditor countries to
Indonesia gathered in the Club de Paris, France is also
contributing to the two successive public debt rescheduling
agreements signed in September 1998 and April 2000.

Out of a total of US$10 billion rescheduled loan, due to
mature between mid-1998 and end of 2002, France is involved for
an amount of $700 million.

The commitment of the French authorities to support Indonesia
in this difficult period is based on a long friendship between
the two countries and it will be continued in the future with the
objective to strengthen our bilateral relations.