Indonesia to develop trade with Tunisia

JAKARTA (JP): Indonesia seeks to increase bilateral trade with Tunisia by developing a more direct trade link, an executive of the Islamic Conference Committee at the Indonesian Chamber of Commerce and Industry says.

The committee's executive chairman Muchrim Hakim said yesterday trade relations between the two countries had not been optimal, mainly because of the lack of direct marine and air transport service.

"So far, trade between the two countries has to go through a third country such as Singapore or France, because of the lack of a direct transportation link," Muchrim said.

As a result, businesses from both Indonesia and Tunisia were hesitant to expand their exports to each other, because of extra transportation costs and limited funds, he said.

However, Muchrim said exporters from both countries could get international aid to expand trade links, for example, by using trade facilities offered by the Islamic Development Bank.

The facilities included the Import Trade Finance Operation for imports and the Long-Term Trade Finance Scheme for exports, he said.

Muchrim said that Tunisia, like other Islamic countries, was a good market for Indonesian products.

"We are facing tough competition against products from northern countries such as China, and we must emerge in markets of developing countries," he said.

"These countries are easier to enter, as they do not impose strict political and human rights requirements, protection or tax barriers to our products like developed countries, such as the United States or European countries," he said.

The first secretary of the Tunisian Embassy in Indonesia, Borhene El Kamel, said yesterday that Tunisia, located in the northern part of Africa, was also a perfect gateway for entering other markets in neighboring countries or the European market.

The country had agreed to develop a free trade zone with the European Union for industrial products by 2008, he said.

But businesses from both countries also lacked knowledge about each other's economies, he said.

To establish a stronger network between the two countries, 39 business delegates representing 27 Tunisian companies planned a two-day visit here to meet with local businesspeople.

The delegation is scheduled to meet with the committee and local businesspeople here tomorrow and to attend the National Merchandise and Commodity Expo the next day.

Data from the Tunisian Export Promotion Center shows two-way trade between the two countries declined last year to 26.06 million Tunisian dinars (US$26 million) from 27.62 million dinars in 1995.

The decline was caused by a drop in Tunisian exports to Indonesia to 14.48 million dinars last year from 17.84 million dinars in 1995.

Indonesian exports to Tunisia rose to 11.57 million dinars last year from 9.77 million dinars in 1995, or only 0.2 percent of Tunisia's total imports.

Indonesia mainly exports palm oil, furniture, polyester yarn and synthetic textiles, while Tunisia exports phosphate and fertilizer to Indonesia. (das)