[i]For French Day/Sunday/July 14

For French Day/Sunday/July 14 Material from embassy.

France-RI trade ties: Confirmed for long-term commitment

Indonesia has, for a long time, been a major Asian trading partner for France.

Despite the deep economic and monetary crisis of the late 1990s, French companies have confirmed their commitment to the Indonesian market.

Around 120 French companies are present in Indonesia, including 80 joint ventures. It is estimated that French investment in Indonesia amounts to approximately US$4 billion and provides 30,000 direct and indirect jobs for Indonesians.

The main areas for French exports are industrial products including semi-products (39 percent) like chemicals and electrical components, and equipment goods (36 percent).

Between 1997 and 1999, the economic crisis strongly affected French exports which plunged 70 percent in value (the drop was most felt in the equipment goods sector where France has strong comparative advantages).

However, due to Indonesia's recovery, French exports in 2001 increased by 28 percent.

In France, Indonesian exports hold a strong position with consumer goods: textiles, clothes, leather products (25 percent), furniture (25 percent), and also agricultural and food products (11 percent).

During the crisis, France was a steady market for Indonesian exports and the trade balance has been close to 1 billion euro in favor of Indonesia for the past two years.

French technology and equipment perfectly matches Indonesia's requirements to modernize its industry and infrastructure.

Major sectors of trade and investment include telecommunications, basic infrastructure (mainly road and transportation equipment), water management, agriculture and food.

One of the tools that has been promoting these objectives is our bilateral cooperation.

France has been providing soft loans to Indonesia and is an important bilateral donor of financial aid with more than 300 projects financed over the last 20 years, which is the clearest symbol of France's long-term commitment to Indonesia's economic development.

France fully supports the Indonesian government in its efforts to reform the economy. France, a member of the Paris Club, agreed with other donor countries to an important rescheduling of Indonesia's public debt in April.

In Indonesia, in spite of the economic crisis, some French investors have been achieving very good results for the past two years.

This is particularly true for companies working in the retail trade. Regarding these results, and bearing in mind that France represents an important market for Indonesian exporters, we are sure that our bilateral economic relations will be stronger in the future provided that fiscal and judiciary security is assured.