Mon, 15 Aug 1994

S. Korea-RI economic ties rapidly expanding

JAKARTA (JP): The South Korean Ambassador here, Kyung Chul- kim, foresees a further deepening and broadening of bilateral economic cooperation with Indonesia due to the high degree of complementarity in the resource endowment of the two countries.

"Korea is already Indonesia's fourth largest trading partner and sixth largest foreign investor," said Kim on the occasion of the National Day of the Republic of Korea today.

He noted that the two-way trade between the two countries had been expanding rapidly over the past few years to reach US$4.7 billion last year.

The Korean diplomat projected an even higher rate of trade expansion as a result of the steady increase in Korean investments in the country and in its imports of energy, notably crude oil and liquefied natural gas (LNG).

According to the Investment Coordinating Board, Korea is now the sixth largest foreign investor in Indonesia with 340 investment ventures worth more than $3.65 billion in various industrial areas.

Last month, for example, the state-owned Pertamina oil company and Korea Gas Corporation signed new contracts which will increase Korean LNG imports from almost six million tons this year to nearly eight million tons a year beginning next year.

Korea also became the first newly industrializing country to enter Indonesia's hydrocarbon resource development when Kodeco Energy Co. Ltd.'s offshore concession area, west of Madura island in East Java, came on stream in 1985.

Kodeco has been piping natural gas to the Gresik power plant in East Java since last year.

"But our economic cooperation is not limited to trade and investment (natural resource development)," Kim said, proudly pointing to his country's contribution to various projects in Indonesia, including human resource development, through grant and soft-loan assistance programs.

Korea became one of Indonesia's country donors grouped in the Consultative Group on Indonesia (CGI) in 1992. But even before that year, Korea had begun extending grant and soft loans under its Economic Development Cooperation Fund.


Under this scheme, for example, the Korean government has committed $53 million in grants and soft loans to the financing of several development projects in Sumatra, Kalimantan and Java.

Kim also foresaw a promising future in technical cooperation as Indonesia is expanding and improving its vocational training centers in various provinces.

Korea, Kim said, has committed more than $10 million to the development of vocational training centers in the country and has thus far trained more than 865 Indonesians in Korea and sent 47 experts to help training programs in Indonesia.

Kim who assumed his post here last April also sees the Asia- Pacific Economic Cooperation forum as another boon to further strengthen Indonesian-Korean cooperation.

"Korean President Kim Young- sam will attend APEC's second leaders' meeting here in November," he said in referring to Korea's strong commitment to APEC, notably its bilateral economic ties with Indonesia. (vin)