Sat, 13 Mar 1999

RI and Russia agree to promote trade

JAKARTA (JP): The Indonesian and Russian governments signed on Friday three agreements to promote bilateral economic relations.

The deals signed by Minister of Industry and Trade Rahardi Ramelan and his visiting counterpart Georgy V. Gabuniya included agreements on technical cooperation, on trade and on the avoidance of double taxation.

"These agreements will provide a solid basis for the business communities of our two countries to work diligently in the spirit of partnership in enhancing economic and trade relations," Rahardi told reporters after the signing ceremony.

This ceremony was also attended by Russian Deputy Prime Minister Yury D. Maslyukov and Indonesian Coordinating Minister for Economy, Finance and Industry, Ginandjar Kartasasmita.

Rahardi said the agreements would be followed by the establishment of the Indonesia-Russia Joint Commission on Economic and Trade Cooperation.

The two countries would sign more partnership pacts in the near future, including the Investment Guarantee Agreement, Air Transportation Agreement, and Tourism Cooperation Agreement, he said.

He said he had also consulted with Russian Trade Minister Gabuniya over the possibility of signing a counter-purchase agreement between the two countries to intensify bilateral trade.

"Counter trade needs support in the form of a binding agreement between the governments and the private sector," he said.

The counter-trade deal would follow the two agreements already signed with China and Korea earlier, he said.

Rahardi noted that the bilateral agreements with Russia were signed when the two countries were enduring financial and economic crises.

But the fact that both of the countries were richly endowed with natural and human resources would strengthen their resilience, he said.

"In efforts to revive the economy, both countries require accelerated state support and assistance to domestic enterprises in finding ways to speed up market penetration," he said.

Bilateral trade between Russia and Indonesia was limited in the past, he said.

In the January to October period of 1998, total trade volume between the two countries reached US$115.4 million, down from $282.2 million in the same period in 1997.

Indonesia suffered a $38.4 million deficit in its bilateral trade with Russia in the first three quarters of 1998, with exports reaching $38.5 million and imports totaling $76.9 million.

In the same period of 1997, imports from Russia reached $210.9 million while exports from Indonesia to that country reached $71.3 million.

Indonesia's exports mostly comprised agricultural products including natural rubber, tropical oil, cocoa and tea as well as consumer goods like textiles, garments and footwear.

Indonesian imports from Russia are dominated by raw materials such as ferrous and non-ferrous metal products, fertilizers and chemical products.

Maslyukov and Gabuniya, and 20 other Russian delegates comprising government officials and business figures arrived here on Thursday for a three-day visit. (das)