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Indonesia, Singapore reaffirm economic, people-to-people relations
Bossing about: President Joko “Jokowi” Widodo (left) and Singaporean President Halimah Yacob inspect the honor guard during the latter’s state visit at the Bogor Palace in West Java on Tuesday
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ossing about: President Joko “Jokowi” Widodo (left) and Singaporean President Halimah Yacob inspect the honor guard during the latter’s state visit at the Bogor Palace in West Java on Tuesday. (Antara/Hafidz Mubarak A.)
Jakarta and Singapore reaffirmed on Tuesday their commitment to strengthening cooperation in a wide array of issues, including economic and people-to-people ties, as Singaporean President Halimah Yacob embarked on her first official visit to Indonesia this week.
President Joko “Jokowi” Widodo welcomed Halimah at the Bogor Palace in West Java on Tuesday, during which the two engaged in a bilateral meeting to discuss issues surrounding cooperation between the two Southeast Asian nations.
In a joint statement after the bilateral talks, Indonesia and Singapore announced the signing of the updated double tax avoidance (DTA) agreement between the two countries, which concludes negotiations that started in 2015.
“I was pleased to witness the signing of the updated avoidance of double taxation agreement between Singapore and Indonesia,” Halimah said at the palace on Tuesday.
“The updated DTA sends a strong signal that the two countries are committed to strengthening economic cooperation amid the challenging global economic situation.”
Halimah went on to explain that the DTA agreement, which will update the existing agreement between the two neighboring countries that came into force in 1992, will lower withholding tax rates for royalties and branch profits, among other points.
She added that the Singaporean government looked forward to the swift ratification and entry into force of the updated DTA agreement as well as the bilateral investment treaty that was signed by the two countries in 2018, both of which she believed would benefit Singapore and Indonesia’s bilateral investment and trade.
She also lauded the “successful joint project” between Indonesia and Singapore, highlighting that the Kendal Industrial Park in Semarang, Central Java, had been able to attract US$843 million in investment and was set to create more than 8,000 jobs in the area.
Halimah also emphasized that Singapore would support Jokowi’s human resource development agenda going forward.
“The establishment of Kendal Polytechnic within the Kendal Industrial Park is a good example of how Singapore investment supports skills and training for the Indonesian workforce,” she said.
Halimah added that she was also delighted at the Indonesian government’s decision to grant special economic zone status to Kendal Industrial Park, a move which she believed would make the area more attractive to investors.
Jokowi, meanwhile, expressed gratitude to the Singaporean president as the city-state had been among Indonesia’s top foreign investors over the years.
“Singapore has been [among] the largest foreign investors in Indonesia since 2014 and I really appreciate the commitment from Singapore to continuing the investment cooperation, including infrastructure [projects] in Indonesia,” Jokowi said during the joint statement.
Aside from emphasizing economic cooperation between the two countries, Jokowi also welcomed plans to strengthen cooperation in education, such as Block71, a start-up incubator initiated by the National University of Singapore that has expanded to Jakarta, Bandung in West Java and Yogyakarta.
He went on to encourage Singapore to improve the two countries’ cooperation in education, research and development, particularly in vocational training and people-to-people relations.
Investment Coordinating Board data shows that realized investment from Singapore reached $1.1 billion in 2019, accounting for 16.1 percent of total realized foreign investment in Indonesia.
The figure placed Singapore as the third-largest foreign investor in Indonesia, below China and Hong Kong.
Apart from the updated DTA agreement, the Singaporean Police Coast Guard and Indonesian Finance Ministry’s Directorate General of Customs and Excise also signed a memorandum of understanding to tackle smuggling, trafficking and other forms of transnational crimes.
The agreement, also signed on Tuesday, would allow the agencies from the two countries to conduct regular joint operations, patrols and bilateral training, Halimah explained.
Halimah arrived in Jakarta on Monday and is set to continue her visit until Thursday. She is scheduled to visit Yogyakarta on Wednesday, where she will be welcomed by Yogyakarta Governor Hamengkubuwono and visit Gadjah Mada University .
