Australia And Indonesia To Sign Free Trade Agreement

Roman Schwartz
September 3, 2018

BOGOR, Indonesia-The leaders of Indonesia and Australia hammered out a free-trade agreement that they said would lead to lower tariffs and would relax investment regulations.

Indonesian President Joko Widodo and Morrison signed a memorandum of understanding committing the countries to get a free trade deal done within months.

Scott Morrison became Australia's prime minister last week after factional warfare in the ruling Liberal Party ended Malcolm Turnbull's short tenure as prime minister.

"Indonesia has the honour of being the first country visited by the prime minister".

Bilateral trade between the neighbours was US$8.5 billion (S$11.6 billion) a year ago, with Indonesia a incurring deficit of US$3.5 billion.

The Asian neighbours have been in prolonged trade talks since early in the decade, with diplomatic tensions between the two sides occasionally stalling the negotiations.

Indonesia, southeast Asia's largest economy, is Australia's 13th-largest trading partner and government figures put annual two-way trade at A$16.4 billion (RM49 billion) in 2016-2017.

Shares extend falls on Trump trade threats
Global markets had started the week on a high, fueled by hopes for a new Canada-US-Mexico trade pact and easing Brexit fears. Donald Trump blamed the trade disputes with China for hampering his efforts to denuclearize North Korea.

Indonesian President Joko Widodo chats with Australian Prime Minister Scott Morrison at the presidential palace in Bogor, Indonesia August 31, 2018.

"We have also taken a big step in economic relations today by ensuring Australia and Indonesia realize the existing economic opportunities".

"Trade agreements with neighbouring countries such as the IA-CEPA helps provide our industry with confidence that it can continue to prosper through developing export markets, which helps secure the profitability and competitiveness of the Australian vegetable industry".

Birmingham listed frozen meats, live cattle, feed grains, dairy, citrus and rolled steel as examples of Australian products destined for favourable treatment under the deal.

Morrison said he hopes his relationship with Jokowi will be as good as that enjoyed by Turnbull.

Although the deal will not be formally signed immediately, Morrison welcomed the development.

On security, President Widodo noted that Indonesia and Australia agreed to boost cooperation in the battle against extremism and strengthen their collaboration on fighting cyber crimes.

Other reports by

Discuss This Article

FOLLOW OUR NEWSPAPER