A new trade era with one of the world’s fastest growing economies has commenced. Almost 100 per cent of Australian goods exported to Indonesia will enter duty free and provide a competitive edge for Australia’s farmers, businesses and investors.
The Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA) commenced on July 5 after it was ratified by Indonesia’s parliament in February.
Under the agreement, almost 100 per cent of Australian goods exported to Indonesia will enter duty free or under significantly improved and preferential arrangements that will give Australian exporters a competitive edge.
Simon Birmingham, Federal Trade Minister said the agreement will provide a boost for Australian farmers and businesses who have been doing it tough during the COVID-19 crisis.
He said Australian grains growers will now be able to export 500,000 tonnes of feed grains including wheat and barley into Indonesia tariff free. This will provide a significant boost for the Australian grains industry, building on our substantial milling wheat exports.
“Australian services suppliers and investors will also benefit through greater certainty for entry and operation in the Indonesian market, including guaranteed levels of Australian ownership in a range of sectors,” he said in a statement.
“This is the most comprehensive bilateral trade agreement Indonesia has ever signed, and will give our exporters a competitive edge in what is one of the fastest growing economies in the world.”
Simon said with one in five jobs trade related, enhancing opportunities for Australian exporters, with key trading partners such as Indonesia will be crucial to reducing job losses arising from the COVID-19 pandemic and a critical part of our ultimate economic recovery.
David Littleproud, Agriculture Minister said by 2050 Indonesia is projected to be the world’s fourth largest economy, with per person consumption predicted to be greater than China for key commodities such as cereals and beef.
“With many restrictive tariff requirements for our exporters being eliminated under this agreement, Indonesia represents a game-changing opportunity for our farmers,” he said.
“Our dairy farmers will benefit from the elimination of a five per cent tariff on concentrated and sweetened milk and cream.”
Andrew Gee Minister Assisting the Minister for Trade and Investment said the IA-CEPA was a big win for country exporters looking to get their high-quality products out into the global market.
“Indonesia is our 13th largest export market and there is huge potential for the relationship to grow. The IA-CEPA will provide big ticket items for Australian exporters, including preferential access into the Indonesian market for our cattle farmers and citrus producers,” Andrew said.