Indonesia to sign trade agreement with Iran next week

 
  Jakarta and Tehran have concluded the final stage of negotiations on a bilateral trade agreement,
  the `Indonesian Trade Ministry said on Wednesday.  

  The announcement came after the two sides finished a seventh round of talks, and the ministry
  said the governments could now proceed to sign the documents on the deal, which is called the
  Indonesia–Iran Preferential Trade Agreement (II-PTA).  

  The ministry said Indonesia and Iran would sign the trade agreement during a visit of Iranian
  President Ebrahim Raisi to Jakarta between May 22 and 24.  

  “Iran is a nontraditional trade partner for Indonesia. With this PTA, we hope to widen our export
  opportunities and expand our market reach, especially in the Middle East and Persia,” Johni
  Martha, the ministry’s director of bilateral negotiations. 

  Indonesia has been looking to new markets to diversify its export options and thereby reduce its
  reliance on traditional trade partners, many of which have been affected by a weakened global
  economy and geopolitical risks.  

  The government aims to speed up the country’s economic recovery from the impacts of the
  COVID-19 pandemic by increasing its exports.  

  Countries of the Middle East are among those considered alternative trade partners for the
  government, along with countries in Africa, South Asia, South America and Eastern Europe.  

  In July last year, Indonesia inked a comprehensive economic partnership agreement (CEPA) with
  the United Arab Emirates. The government has been pursuing similar cooperation with other Gulf
  states, including a CEPA with Saudi Arabia since 2018.  

  The negotiations between Indonesia and Iran come at a time of heightened geopolitical tensions
  in many parts of the world.  

  The United States government has imposed sanctions on Iran since 1979, following the seizure of
  the US embassy in Tehran, which restricted access for US companies to conduct business in Iran.  

  The Trade Ministry noted that trade between Indonesia and Iran amounted to US$54.1 million
  during the first three months of this year. Last year, the bilateral trade value increased by more
  than 23 percent to $257.2 million. 
 

  Motorcycles, vehicle parts, fatty acid industrial monocarboxylates and wood fiber are among the
  main goods shipped from Indonesia to Iran.  

  Meanwhile, major Iranian shipments to Indonesia include dates and grapes, carbonates and
  vegetable alkaloids, among many other products.  

  The ministry said Indonesia and Iran had also concluded negotiations on an article related to
  countertrade, which allows the two countries to pay for goods and services from the other side in
  kind rather than settling transactions with money.  

  This would allow trade between the two to continue despite possible difficulties in securing
  currency commonly used in international trade, such as US dollars.  

  “We have communicated intensively. Several postponed issues have been concluded. Both
  parties have been showing flexibility and commitment to quickly wrap up these negotiations,”
  Johni. 

  Source: The Jakarta Post

  Indonesia, EU complete 14th IEU-CEPA negotiations round 

  Indonesia and the European Union (EU) successfully completed the 14th round of the Indonesia-
  EU Comprehensive Economic Partnership Agreement (IEU-CEPA) negotiation in Brussels,
  Belgium, from May 8–12, 2023. 

 
  According to a statement received on Saturday, the two parties managed to achieve significant
  progress on the development of the agreement in the negotiation round. 

 
  "With this progress, we are optimistic that we can achieve the determined targets (in this
  negotiation process),” Director of Bilateral Negotiations at the Indonesian Trade Ministry Johni
  Martha said. 

 
  The negotiation team will continue to pay attention to Indonesia’s national interests, while
  considering the fair benefits that could be obtained by both parties, he added. 

 
  “Furthermore, all working groups will also continue to increase coordination and ready the
  attempts needed to resolve any tough issues," he said. 

 
  In a meeting on the sidelines of the G20 Summit in Bali in November 2022, Indonesian President
  Joko Widodo and President of the European Commission, Ursula von Der Leyen, expressed the
  hope that the IEU-CEPA negotiations would be substantially completed by the end of 2023. 

 
  "Both parties are committed to maintaining the positive (negotiation) momentum achieved in the
  previous round," Martha added. 

 
  According to the Trade Ministry’s website, the 13th round of the IEU-CEPA negotiation was held in
  Bali from February 6–11, 2023. 

 
  In the 13th round, both parties managed to complete discussions regarding the Chapter on Good
  Regulatory Practice (GRP) as well as the part concerning geographical indication (GI) in the
  Chapter on Intellectual Property (IP) Rights. 

  Meanwhile, 18 primary issues were negotiated in the 14th round, including trade in goods, rules
  of origin, trade in services, trade security, investment, government procurement, transparency and
  regulatory practice, dispute resolution, institutional provisions, as well as intellectual property
  rights. 

 
  The issues further covered state-owned enterprises, economic cooperation and capacity building,
  investment court system, subsidies, anti-fraud policies, energy and raw materials, small and
  medium enterprises, as well as trade technical barriers. 

 
  In addition, the negotiations over several chapters were completed in the round, such as the
  chapters regarding small and medium enterprises (SMEs), trade remedies (TR), as well as
  transparency. 

 
  The 15th round of the IEU-CEPA negotiations is scheduled to be held in July 2023 in Indonesia. 

 
  The total trade between Indonesia and the EU was recorded at US$33.2 billion (Rp491.2 trillion) in
  2022. 

  During the period, Indonesia’s exports to the EU reached US$21.5 billion (Rp318.1 trillion), while
  Indonesia's imports from the EU stood at US$11.7 billion (Rp173.1 trillion). 

 
  The country’s main export commodities to the EU were palm oil and its fractions, industrial
  monocarboxylic fatty acids, coal, copper, and footwear whose upper parts were made of leather. 

 
  Meanwhile, its main import commodities from the EU included iron and steel pipes, medicines,
  vaccines, pulp-making machines, and recycled paper or cardboard. 

  Source: Antara 

  Construction of proposed LRT system in Batam slated to begin in
 mid-2024 

  The construction of a proposed Light Rail Transit (LRT) system in Batam, Indonesia, is expected
  to begin in the middle of 2024, with the project targeted to finish in 2025. 

  Speaking to CNA, Chief of Batam Development Authority Muhammad Rudi said on Wednesday
  (May 17): “The land in Batam is managed by (the Batam Development Authority) so we can
  dedicate land for this project quite quickly. In other places, it can take years to free up land
  needed for any project.”  

  He also said: "The construction itself will start in mid-2024. We expect the project to be completed
  in 2025. That is our target.” 

  In a statement last month, Mr Rudi, who is also the mayor of Batam, announced his plan to build
  an LRT mass transportation system in order to reduce congestion and “make Batam a modern
  city”. 

  Mr Rudi told CNA on Wednesday that the LRT system is needed to accommodate Batam’s
  growing population, especially since more workers and visitors are expected in the
  post-pandemic period. 

  “For now, the only public transportation we have are buses. This is currently enough for the 1.2
  million inhabitants of Batam. But we have to think about the future,” he said.  

  He noted that Batam’s population is currently 1.24 million, up from 1.22 million last year. He added
  that the growth of private vehicles is faster than the city’s population growth.  

  According to him, five capsule-shaped LRT cars will be combined for a single trip. One LRT car
  can fit 20 people, with 10 people seated and 10 people standing. The cars are expected to be
  suspended at a height of around 9m. 

  “I think it is a unique design … It is like no other LRT. Because it is unique, this can become an
  icon of Batam,” he said.  

  Mr Rudi also said that there are four companies from Singapore, Malaysia, Germany and
  Indonesia that are working on potential design proposals. ”Although they are the ones proposing
  this, we will still hold a bidding process … (expected to start) in November,” he said. 

  He told CNA that the first phase of the project will be 11km long with 16 stations planned.  

  “We want to start with a line connecting the airport and Batam City Centre … In July, we will start
  the construction of Terminal 2 (of the Hang Nadim International Airport). We plan to build our
  station in between the existing terminal and the new terminal,” he said.  

  He also said that the project for Phase 1 is valued at US$110 million.  

  Mr Rudi also said that Phase 2 will encircle the city centre while Phase 3 will connect the city
  centre to Batu Ampar, Batam’s industrial area. However, no timeline has been set yet. 

  Source: CNA