Thu, 16 Jun 2011

Jakarta (ANTARA News) - The European Union (UE) hoped a comprehensive economic cooperation with Indonesia under the Comprehensive Economic Partnership Agreement (CEPA) could raise the investment opportunities for European companies in Indonesia.

"In the short run, we hope to raise investments here," head of an EU delegation/ambassador Julian Wilson said following an Indonesian-EU vision group recommendation in Jakarta Wednesday.

He said under the cooperation, the EU wished for a conducive climate for its business players in Indonesia.

He said while the EU is still the second biggest investor in Indonesia after Singapore, direct EU investment to Indonesia was still small than that of the entire Asia.

"Investment in Indonesia accounted for only 1.4 pct of EU`s direct investment in Asia," he said.

Julian said most of EU investors had been investing in the textile, footwear and pharmaceutical companies in Indonesia.

"If conditions are favorable, they may invest in the aircraft industry here," he added.

He also said that increase in EU`s investment in Indonesia is mutually beneficial.

"Unlike China, cooperation is merely mutually complementary to meeting their own purposes. Indonesia, however, can also benefit from our investment such as in employment," he said.

He also said that the EU is also hoping for the benefit of increased trade under the CEPA.

And he said that the increased trade would not harm Indonesia`s trade because the commodities of the two sides are more complementary in nature.

"We are manufacturing high-tech machinery for factories here, while Indonesia is producing things like textile, footwear and raw material for export to Europe under a mutually beneficial cooperation," he said.

Talks about increased Indonesia-UE relations under the CEPA were started from a meeting between President Susilo Bambang Yudhoyono and European Commission President Jose Manuel Barroso by the end of 2009.

The two sides agreed to increase trade and investment, and assigned a joint vision group to study the potentials of the cooperation.

For six months the vision group discussed issues on the planned partnership and made some recommendations, including bilaterial agreement between the two sides covering a rate of nil percent of 95 pct of the rates of at least 95 pct of the trade value in not more than nine years.

In the meantime, joint chairman of the Indonesia-EU vision group Djisman Simandjuntak said the recommendations include increased market access through dealing sanitation standard problems and other non-tariff obstacles as well as capacity development.

"Combining capacity facilities and development needs to consider how to reach harmonized standards and evaluation of Indonesia and the UE. The vision group recommended CEPA to identify priority sectors once in every three years for adjustment of standards, testing, evaluation and accreditation," he said.

The vision group also recommended CEPA to include concrete measures to promote "green" elements on a sustainable basis in trade and investment in Indonesia and the UE.

"Sustainability here is not only referring to the environment, but business relations as well," member of vision group Jakob Sorensen said.

Another vision group recommendation covers the management of the government, increasing capacity to support increased market access, and prenegotiation, socialization and consultation.

"Initial consultations with the important stakeholders are also very important, with socialization and consultations conducted pior to negotiations so that many sides already have their inputs," Djisman said.

He also suggested quick negotiations so that cooperation agreements could be carried out at least in the next two years.(*)