The Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA) was signed by Prime Minister Scott Morrison and President Joko “Jokowi” Widodo in federal parliament on Monday.
The bilateral economic partnership will help Australian businesses profit from lower import tariffs and greater market access as the agreement will eliminate 99 per cent of Australian goods imported into Indonesia.
This is expected to increase the competitiveness of local exports and boost Australian ownership of companies based in Indonesia.
Australian exporters will receive automatic issue of import permits for live cattle, frozen beef, sheep meat and other key exports.
Indonesia is Australia’s 13th largest trading partner and In 2018-19, the total two-way trade in goods and services with Indonesia was worth $17.8 billion.
The Australian Government’s Department of Foreign Affairs and Trade stated that Indonesia is one of the fastest growing economies in the Indo-Pacific, and presents a significant opportunity for Australian businesses.
“By some estimates, Indonesia will be the world’s fifth-largest economy by 2030, and IA-CEPA ensures that Australia is well-placed to deepen economic cooperation and share in Indonesia’s growth,” the department stated.
The announcement of the partnership follows the Peru-Australia Free Trade Agreement (PAFTA) that enters into force Tuesday 11th February.
The PAFTA was signed in 2018 and is expected to expand peru’s presence in Australia’s agricultural industry.
James Yeomans, deputy head of mission of the Australian Embassy in Peru, told ComexPerú “Peruvian products with the greatest potential to enter the Australian market are avocados, asparagus, table grapes, blueberries, tangerines.”
The Australian Government’s Department of Foreign Affairs and Trade stated that “this trade agreement provides Australian businesses a gateway to Latin America, strengthening our economic relationships within the region and helping facilitate value chains between Americas and Asia”.