Six decades of relations between Indonesia and Switzerland could be used to boost momentum to strengthen ties, including accelerating negotiations on the establishment of a comprehensive economic partnership agreement (CEPA) between Indonesia and four members of the European Free Trade Association (EFTA), a diplomat has said.
Despite strong and growing bilateral ties, Foreign Ministry director general for American and European Affairs Dian Triansyah Djani noted the need for Indonesia to widen its ties with Switzerland and its surrounding countries.
The value of bilateral trade between the nations is currently US$260 million. “We have to dissect and explore the untapped potential within both our countries,” he said in a seminar celebrating 60 years of bilateral relations, organized by the Swiss Embassy in cooperation with the Centre for Strategic and International Studies (CSIS) in Jakarta on Thursday.
Dian said that there were many other areas of cooperation that could be enhanced, such as sustainable development, fighting transnational crime and money laundering and providing mutual legal assistance (MLA).
The anniversary of six decades of relations is also timely to accelerate CEPA-EFTA negotiations.
Indonesia is in the process of negotiations to tackle a number of barriers impeding trade and investment with members of EFTA, which is comprised of Iceland, Lichtenstein, Norway and Switzerland. The EFTA has been seeking economic partnerships with countries in the region including Malaysia, Vietnam and India.
Indonesia’s chief negotiator for the CEPA-EFTA, Soemadi Brotodiningrat, acknowledged slow progress in the negotiations ahead of a seventh round of talk in Surakarta, Central Java, in May.
“By its nature, Indonesia is always cautious when it comes to negotiating free trade, not only with the EFTA,” Soemadi said.
Soemadi said that the negotiations would be complex, especially since the two parties’ economies and populations were different in size.
Another problem, he said, would be that Indonesian stakeholders were unfamiliar with the EFTA market and its economic potential. “In our mind-set, the question is not of benefit, but rather about loss.”
Indonesia tends to the perception of opening markets based on our rules. We do not intend to jointly make the rules with them.”
Despite a number of unresolved issues, Soemadi said that he hoped the 60th anniversary of bilateral relations would create momentum for negotiations.
Dian said that capacity building was an important point in the negotiations. “This will be a stepping stone, and after that there can be another step to much larger negotiations with the EU. Bilateral negotiations take time, let alone negotiations with four countries,” he said.
Swiss ambassador to Indonesia, Timor-Leste and ASEAN Heinz Walker-Nederkoorn said that inter-sessional meetings required a different attitude of negotiation.
He compared Indonesia’s progress to that of India, which is currently conducting parallel negotiations with the EU.
“The bigger the country, the more complicated the decision making process will be to bring the main stakeholders into one line,” he said.
Swiss corporate powerhouses are among the most dominant in the food, pharmaceutical, agricultural biotechnology, banking and insurance sectors.
Nestlé, for instance, ranks 12th of top 500 companies, and operates three factories across Indonesia.
Indonesia-EFTA trade amounted to US$1.06 billion in 2012. The EFTA’s main export categories to Indonesia were machinery and pharmaceuticals, while Indonesia primarily exported footwear, electrical machinery and apparel to the EFTA market. (asw)
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