During a state visit to Indonesia dominated by the hot-button issue of people-smuggling, Australian Prime Minister Tony Abbott called for a strong partnership between the meat industries of the two nations, saying that Australia would offer help to expand Indonesia's cattle industry and welcome agricultural investment from Indonesia in Australia.

Along with an entourage of 20 senior Australian business leaders, Abbott said during a breakfast with Indonesian ministers and businesspersons that his newly elected government was determined to leave the time of disrupted beef trade in the past and was keen to explore investment opportunities and build partnerships in the sector.

'This is a chance here for each of us to play to our strengths: Indonesia, an acknowledged world leader in fattening and finishing, with some of the world's finest intensive feedlots; and Australia, with our vast grazing lands and our long pastoral history, skilled at breeding beef cattle at a globally competitive price,' he said in his remarks.

Beef and cattle exports have been a contentious issue between Indonesia and Australia ' two countries that have seen numerous ups and downs in their bilateral relations, particularly after Canberra imposed a ban on live cattle exports to Indonesia in 2011 following an animal-cruelty scandal broadcast on Australian television.

Although the export ban, which Australian herders said had seriously damaged the country's industry, was lifted later in 2011, Indonesia still reduced its import quota from 660,000 head of cattle to 260,000 per year to attain its self-sufficiency program.

The reduction, however, backfired, as it caused shortages and skyrocketing prices due to a lack of domestic supply to meet Indonesia's 500,000 tons of annual beef consumption. Indonesia has since altered its quota policy and has begun sourcing more cattle from the neighboring country.

Indonesia Trade Minister Gita Wirjawan said that due to a scarcity of open land in the country, Indonesia was open to all sorts of possibilities to enhance food productivity, including securing a business proposition in Australia for the purpose of fulfilling the food needs of Indonesia.

Australian Agricultural Company chairman Donald McGauchie, who was among the delegation joining Abbott and whose company exports around 60,000 head of cattle to Indonesia annually, said that cattle business players welcomed Indonesia's intention to develop its own cattle breeding business in Australia.

'[Indonesia's] been the biggest market for [Australian] live cattle, but it's not the biggest market for processed beef yet, but it will grow as well,' he told The Jakarta Post on the sidelines of the event.

Besides agricultural issues, Abbott also called for robust economic cooperation, noting that the two countries had yet to fulfill their bilateral potential, despite a long history of trade and increased people-to-people contact in recent years.

Trade relations between the two countries date back to the 17th century, and it has now been 80 years since the first trade commissioner was appointed to what was then Batavia.

However, compared to New Zealand, which has a population of only 4 million people, annual trade between Australia and Indonesia is still low, about Aus$15 billion.

Abbott said the new government intended to pursue fiscal restraint, deregulation, tax cuts and investment in economic infrastructure.

He also underlined the need to have more Australians studying in Indonesia, saying that he sought to launch a new Colombo Plan ' which previously operated from the 1950s to the 1980s and saw tens of thousands of the future leaders of the region educated at Australian universities ' to bring the best and the brightest students from the Asia-Pacific to Australia and vice versa.

Meanwhile, Australian Minister of Trade and Investment Andrew Robb said that it was important to have a significant political and economic relationship with the Indonesian government.

'We think now it's the perfect time to take the relationship to another level, to make Indonesia one of the significant partners in the world for Australia,' Robb said. (tam)

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