French-Indonesian trade keeps growing

French-Indonesian trade keeps growing

Trade between France and Indonesia is growing steadily and
reached FF 14.7 billion (US$2.5 billion) in 1997, an increase of
26 percent over 1996. French exports were boosted by the delivery
of four Airbus A330 to Garuda Indonesia, and grew overall by 33
percent. Indonesian exports to France rose by 17 percent, and
achieved a record level of FF 6 billion.

Indonesia saw its trade deficit with France increase from FF
1.3 billion in 1995 to FF 2.6 billion in 1997. In 1998, the
bilateral trade balance will shift in favor of Indonesia, whose
exports to France increased at a high pace during the first three
months, boosted by their renewed competitiveness. The strong
decrease of overall Indonesian imports following the slowing down
of the economy will inevitably translate in a contraction of
French exports to Indonesia this year.

In 1997, Indonesia was ranked France's 31st customer with a
trade flow representing 0.53 percent of France's total exports
and its 33rd supplier, providing 0.39 percent of France's total
imports.

French exports to Indonesia are highly diversified and
concentrate for the most part on industrial goods. Besides
aerospace, which ranked first in 1997, France's main exports to
Indonesia are electrical equipment, electronics,
telecommunications equipment, machinery, chemicals, steel tubes
and pharmaceuticals. Consumer goods exports are growing steadily
but still represent a small percentage of total exports.

Indonesian exports to France are concentrated on a smaller
number of products, particularly shoes, textiles and garments,
plywood, rubber, consumer electronics, furniture, toys, coffee
and cocoa. Textiles and garments are by far Indonesia's main
export to France, and combined represent 26 percent of total
exports, followed by food products (17 percent), shoes (14
percent), furniture (14 percent) and consumer electronics (13
percent).

Although the bilateral trade figures will remain below their
potential level until the Indonesian economy recovers, they are
expected to catch up strongly afterwards. A growing number of
French companies are ready to develop and increase their market
share in Indonesia. They have the necessary capacity, a high
level of technology, a skilled workforce and their strategies are
already strongly directed toward foreign market.

An exhibition, France High Tech, held in Jakarta in April this
year, had more than 15,000 visitors. Staging such an important
event amid the crisis was proof of France's confidence in
Indonesia's future.

Table: France-Indonesia bilateral trade (in million FF)

French Indonesian

exports to exports to Trade

Year Indonesia France Balance

---------------------------------------

1990 2,819 2,940 -121

1991 3,728 3,617 +111

1992 6,619 4,265 +2,354

1993 4,549 4,582 -33

1994 4,169 4,472 -303

1995 5,173 4,537 +636

1996 6,513 5,148 +1,365

1997 8,685 6,027 +2,658