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hina says it will not review the ASEAN-China Free Trade Agreement (ACFTA) with Indonesia as it is not a bilateral agreement.

Indonesia could, however, discuss specific problems with China, Chinese Ambassador to Indonesia Zhang Qiyue said on Tuesday.

“Whenever there is a specific problem, the Chinese government is very much willing to discuss it with [our] Indonesian counterparts,” Zhang told reporters after a forum hosted by state radio station RRI in Jakarta.

The ACFTA was signed in 2004, leaving enough room to make arrangements for gradual tariff reductions and to disseminate information on implementing the agreement, Zhang said.

Zhang added that Indonesia’s trade deficit with China was US$1.2 billion since the agreement was implemented in 2010, according to Chinese government statistics — substantially less than the $5.6 billion recorded by the Indonesian government.

Indonesia needed to look at the specific items constituting its trade deficit, rather than the amount, Zhang said.

“The deficit is a result of imports of raw materials, intermediate materials and machinery used to support economic activities,” she said, adding that in recent years, Indonesia had increased its imports of Chinese machinery to build infrastructure, such as power plants.

Zhang said that the free trade agreement had had an overall positive effect although China had suffered a trade deficit with ASEAN as a whole.

According to the Chinese government, trade between China and ASEAN was valued at $292.8 billion in 2010, up 37.5 percent from 2009, before the ACFTA was implemented.

China’s exports to ASEAN were valued at $138.2 billion in 2010, up 30.1 percent, while its imports were$154.6 billion, up 44.8 percent.

Zhang said China would take several measures to help Indonesia, such as asking Chinese commercial banks to give more loans to vulnerable Indonesian industries and encouraging Chinese firms to invest in Indonesia.

Several Chinese steel, textile and footwear companies are reportedly eying investments in Southeast Asia’s largest economy.

Zhang said China would encourage its textile and footwear machinery associations to assist their Indonesian counterparts.

“We want to develop bilateral trade between China and ASEAN or Indonesia. We want both sides to get the long term benefit from [the ACFTA],” she said.

Indonesia scrapped 6,682 tariffs for goods in 17 sectors, including 12 in the manufacturing sector and five in the agriculture, mining, and maritime sectors following the ACFTA’s implementation on Jan. 1, 2010.

According to a survey released by the Industry Ministry in March, Indonesian products have lost ground to Chinese goods in the domestic market after ACFTA’s implementation.

Meanwhile, Trade Minister Mari Elka Pangestu was quoted by detikfinance.com as saying that she still believed the solutions agreed to by the China and Indonesia in 2010 would solve trade imbalances.