December 20, 2012

 

Australia to tighten economic bilateral ties with east Indonesia

 

 

As part of its goal to tighten bilateral economic ties, Australia aims to establish a stronger business presence in Indonesia, particularly in the eastern part of the archipelago.

 

One of the potential areas that is drawing interest from Australian business people is animal husbandry in which they had already demonstrated widely known expertise, Terry Mills, the chief minister of Australia's Northern Territory, said.

 

"We can provide cattle breeding stock to the eastern provinces and the farmers can raise and fatten the cattle, then send them up to Jakarta and feed the rest of the country," he said after a business meeting with the Indonesian Chamber of Commerce and Industry (Kadin) on Tuesday (Dec 18) in Jakarta.

 

Australia has long been Indonesia's top source of imports of live cattle because its animals are free from major illnesses, such as foot and mouth disease, which makes it eligible to deliver livestock.

 

Last year, Australia temporarily suspended live cattle exports to Indonesia due to violations of animal welfare in local abattoirs during slaughter. The decision caused a significant impact on Australia's cattle industry, forcing it to resume exports after a deal for improvement in slaughter standards was reached by both sides.

 

Bilateral trade between Indonesia and Australia stood at US$5.67 billion during the January-July period this year, up only 0.06 % from last year. Potential partnerships could also be made in fisheries and extractive industries, Mills said.

 

Australia's move to step up cooperation with Indonesia comes after Prime Minister Julia Gillard released a white paper called "Australia in the Asian Century", which rolled out a wide-range of important goals and the strategies to achieve them, pertaining to the country's role in Asia and emerging economies in the region, including Indonesia.

 

To help materialise business expansion in eastern Indonesia, Australia expects to improve connectivity by opening direct flights to and from the Northern Territory's capital Darwin and East Nusa Tenggara's capital Kupang, which would take roughly an hour for a single trip, Mills added. Currently, the only direct flight available connects Darwin and Denpasar, Bali.

 

Utama Kajo, Kadin's chairman of natural resources development, said that the Australian government should find an Australian airline that would be interested in the route to enhance the cooperation.

 

"There are many natural resources that can be processed to give added value using technology from Australia," he said, citing handling of fisheries products as an example.

 

Apart from that, Australia could assist local small and medium enterprises to grow through capacity-building assistance, Kajo added.