RI, Libya ink deal to step up trade ties

RI, Libya ink deal to step up trade ties

Fabiola Desy Unidjaja, The Jakarta Post, Tripoli

Indonesia and Libya agreed on Saturday to enhance economic
cooperation between them by finalizing a countertrade deal of
crude oil for commodities and military accessories.

The deal was signed during a visit by President Megawati
Soekarnoputri to Libya, whose economic prospects have received a
major boost since the United Nations lifted earlier this month
15-year-old economic sanctions that had been slapped on the North
African country.

"The deal covers 5,000 barrels of Libyan crude oil per day for
our commodities such as building materials, textiles, furniture
and military accessories," Minister of Industry and Trade Rini
Soewandi said here on Saturday.

The crude oil was worth about US$40 million per month and
would be delivered starting early next year, Rini added.

In exchange, she said, Libya would buy military accessories,
including shoes, caps and belts, from Indonesia.

"They have also ordered three patrol boats from PT PAL
Indonesia, and are giving consideration to buying a Puma
helicopter, NBO helicopter and also a CN-235 airplane from us,"
the minister said.

Indonesia owns aircraft maker PT IPTN in Bandung, and
shipbuilder PT PAL in Surabaya.

Megawati is the second world leader after Spanish Prime
Minister Jose Maria Arnaz to have visited Libya since the UN
Security Council (UNSC) lifted its economic sanctions on the
African country on Sept. 12.

The UNSC imposed economic sanctions on Libya after the bombing
of U.S. Pan Am flight 103 over Lockerbie, Scotland, in 1988. A
Libyan intelligence agent is serving a life sentence in a
Scottish prison for the bombing, while a second was acquitted.

The move clears the way for initial Libyan payments of up to
US$10 million per victim, or $2.7 billion in total, to the
families of the 270 people killed in the attack.

Also on Saturday, the Mali president arrived in Tripoli to
meet with Libyan leader Moammar Qaddafi.

Rini said that Libya had asked for Indonesia's assistance in
the construction field as the country would boost development
projects after the sanctions were scrapped.

"They want us to help them in property construction and are
interested in making investment in some enterprises such as
Petrokimia Gresik and also in tourism," she said.

Megawati received a warm welcome from Qaddafi at a reception
tent located in the compound of the Syuhada monument, at the
Libyan leader's house, bombarded by the U.S. in 1989.

Megawati was given a chance to see the house, which has been
left in the state it was after the U.S. attack, before a full
military ceremony to greet her in front of the guest reception
tent.

Qaddafi also hosted a dinner for all the delegation members
from both Indonesia and Mali at the reception hall, located near
the tent, and entertained them with a variety of performances
from local artistes.

Megawati, wearing a purple dress, and Qadaffi later held a
closed-door meeting at the hotel where the Indonesian President
was staying. It was unprecedented for Qaddafi to visit a guest
outside his residence compound.

Relations between the two countries date back to the 1950s
when founding President Sukarno, Megawati's father, visited
Tripoli. Last year Indonesia opened an embassy in Tripoli,
separate from the Indonesian Embassy in Tunis.

The visit to Tripoli was also marked by some confusion, as the
Libyan government repeatedly made changes to the schedule of
events to be attended by Megawati.

She flew back to Jakarta later on Saturday and is slated to
arrive in Jakarta at noon on Sunday after a stopover in Dubai.