South Korea pushes for stronger cooperation amid declining trade volume

The South Korean parliament is pushing to strengthen cooperation with Indonesia amid a declining trend in trade volume. The statement was made by Kim Gi-Hyeon, Chairman of the South Korea-Indonesia Parliamentary Friendship Association, at the ‘Indonesian Next-Generation Journalist Network’ event organised by the Korea Foundation and the Foreign Policy Community of Indonesia in Seoul on Tuesday. “I hope there will be more opportunities for economic investment, technology transfer, and talent development between Indonesia and Korea,” Kim said. Kim noted that bilateral trade volume is currently experiencing a sustained downward trend compared to 2020, when the figure reached approximately 25.5 billion US dollars. The MP highlighted the growing number of certification requirements under the Indonesian National Standard (SNI), which he said plays a role in increasing non-tariff barriers between the two countries and makes it more difficult for Korean companies to enter the Indonesian market. “This essentially increases non-tariff barriers between the two countries and makes it harder for Korean companies to enter the Indonesian market. These SNI standards were revised around a year ago, so more products are required to obtain certification, while the transition or grace period is getting shorter,” he explained. Kim also highlighted the impact of the removal of electric vehicle (EV) incentives on the automotive industry. According to him, the removal of incentives and policies which he considers to be more beneficial to China has made Hyundai, South Korea’s largest EV manufacturer, reconsider its investment expansion. “Hyundai Motor Company has produced electric vehicles in Indonesia, such as the Kona EV and IONIQ 5. These were the first electric cars manufactured in Indonesia,” Kim said, adding that after the incentive system was removed, the available benefits tended to be enjoyed more by Chinese companies. He said Indonesia could cooperate with South Korea in the fields of robotics and artificial intelligence (AI), as well as their application in the health sector. Kim also expressed his hope that both countries can further enhance talent development and technology transfer, given the large number of Indonesian students receiving scholarships from South Korea. Currently, 1,126 Indonesian students are on South Korean scholarships, making Indonesia the country with the highest number of recipients. At the request of the Indonesian government, South Korea is also pushing a policy to increase the number of Indonesian students studying in STEM (Science, Technology, Engineering, and Mathematics) fields. Indonesia and South Korea’s trade volume in 2025 reached 18 billion US dollars, with Indonesia holding a 25 percent surplus, while in 2024 the figure stood at 20.09 billion US dollars.