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IA-CEPA may be signed next month

A landmark trade deal between Indonesia and Australia may still be signed before the two countries head into general elections, after months of postponements following Canberra’s plan to move its embassy to Jerusalem

Dian Septiari (The Jakarta Post)
Jakarta
Sat, February 16, 2019

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IA-CEPA may be signed next month

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landmark trade deal between Indonesia and Australia may still be signed before the two countries head into general elections, after months of postponements following Canberra’s plan to move its embassy to Jerusalem.

Foreign Ministry spokesperson Arrmanatha Nasir said on Friday that the two sides were looking out for the most “appropriate” moment to meet and sign the multibillion dollar deal, deferring the final decision to their respective trade ministers.

“I think at the moment the two [trade] ministers are working on the technical details [...] to find the appropriate time to sign the agreement,” he told reporters in Jakarta.

Trade Minister Enggartiasto Lukita told reporters the previous day that the Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA) could be signed next month.

Up until the end of last year, the minister had insisted that the signing of the CEPA document came under the authority of the Foreign Ministry, which had expressed disappointment over Canberra’s apparent sudden change of tack in its Middle East policy.

The deal, negotiations for which had been concluded in August, was due to be signed in November but was postponed when Australian Prime Minister Scott Morrison proposed the relocation of the country’s embassy in Israel to Jerusalem.

This sparked strong criticism from Jakarta, with Foreign Minister Retno Marsudi reportedly telling her Australian counterpart Marise Payne that it was a “slap in Indonesia’s face”.

As the world’s largest Muslim-majority country, Indonesia is a staunch supporter of the Palestinian cause, and has argued that the status of Jerusalem must be negotiated between Palestine and Israel as part of a final peace deal.

Both Israel and Palestine claim Jerusalem as their capital.

Morrison, who first floated the proposal ahead of a by-election in a Sydney suburb with a sizeable Jewish population, conceded that the embassy move would only be initiated “when practical”.

Meanwhile, Enggartiasto’s statement on the margins of a meeting with the Eurasian Economic Union was gladly welcomed by Australian Trade Minister Simon Birmingham, who was quoted by AFP as saying it “would increase the two-way flow of trade and investment”.

Kevin Evans, Indonesia director at the The Australia-Indonesia Centre, said it was possible that Indonesia had begun to feel comfortable talking about the impending trade deal, and that Canberra would not pull any more surprises.

“Maybe Australia’s clarification [...] and acknowledgment of the aspirations of the Palestinian people was sufficient to show that Australia still held to the global consensus,” he told The Jakarta Post on Friday.

Evans also said March would be the right time for the two sides to seal the deal, as they both faced elections in April and May, respectively.

President Joko “Jokowi” Widodo faces a second presidential debate on Sunday, which will discuss food security, a topic of interest to Australia.

The IA-CEPA will include improved access for Australian cattle and sheep farmers to Indonesia’s market of 260 million people. Meanwhile, greater access to the Australian market is expected to spur Indonesia’s automotive and textile industries and boost exports of timber, electronics and pharmaceuticals.

Bilateral trade between the two countries was worth US$11.7 billion in 2017. (tjs)

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