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The country’s biggest international trade exhibition, the 27th Trade Expo Indonesia (TEI), has booked US$1 billion in transactions, up 115.29 percent from $464.5 million last year, but still behind the government’s ambitious target of $2 billion.
Deputy Trade Minister Bayu Krisnamurthi said that the figure was already “quite big” in terms of direct transactions, and claimed it could lead to much higher transactions in the future following what had been sealed during the event.
“In an exhibition, booked transactions are only precursors for bigger business deals. The event serves as an opportunity to open a network between buyers and sellers, and this will be followed next by contracts,” he said during a press conference on Thursday in Jakarta.
Out of the $1 billion transactions, around $780 million, or 78 percent, were made up by goods purchases, dominated by automotive and components (31.03 percent), aircraft and components (20.11 percent), electronics and electrical products (18.06 percent).
The remaining $220 million, or 22 percent, comprised service orders, particularly in the hospitality, mining and construction sectors.
Trade Ministry director general for national export development Gusmardi Bustami said that in addition to the $1 billion booked, the total value of transactions could potentially increase as there were ongoing negotiations still underway in the area of construction services.
According to Gusmardi, state-owned construction firm PT Wijaya Karya is still in talks with a South African counterpart, which may result in a $2 billion contract to develop parliament buildings in several African countries. “At present, the negotiations are already in the final stage,” he said, this further supports a possible post-event financial transaction boost, and would push up the Trade Ministry’s already ambitious initial target figure of $2 billion.
The five-day expo, which concluded on Oct. 21, was buoyed by a higher-than expected number of buyers registering at the event.
The expo saw 5,430 buyers from 95 countries, which was much higher than the initially pessimistic target of only 1,500 buyers. The initial low target was driven by the slowing global economy. Last year, the 26th TEI recorded a much higher number of buyers, 8,311, from 44 countries.
The biggest number of buyers visiting the expo came from Nigeria (11.27 percent), followed by Malaysia (6.10 percent), India (4.11 percent), the United States (4.11 percent) and Bangladesh (3.79 percent).
The deputy trade minister said that despite the government efforts to diversify exports to South America, the presence of buyers from the region was less than expected.
The Trade Ministry has scheduled the next annual expo to run from Oct. 16 to 20 in 2013, and it aims to double the number of exhibitors and buyers to 3,000 and 10,000 respectively.
Indonesian Employers Association (Apindo) chairman Sofjan Wanandi warned that while uncertainties over the global economic recovery persisted, more serious effort would be necessary to make a strong presence in the new markets.
The major tasks for the government would be to support exporters with adequate financing and banking facilities and solve logistical issues, in addition to opening representative offices in non-traditional destinations.
“We should not stop at annual meetings [at the expo], we must follow this up so that our trade transactions can really grow in new buyer countries,” he said during the press conference.