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Eyes on environment as bilateral trade with Indonesia takes off

Though most of the general chatter surrounding international trade seems to be about Australia and China, I suspect that behind some ministerial doors a great deal of time is spent on New Zealand’s relationship with Indonesia, and the ever-widening trade channel with the world’s fourth most populous nation.

Kiwis would be justified in feeling a patriotic swell in the breast over some recent events bearing on international relations. For example, the 20 September visit to New Zealand by United States Defence Secretary Leon Panetta led to a softening of U.S. policy on New Zealand navy vessels (and a general, if grudging, nod of acceptance that the nuclear-free policy isn’t going anywhere). The following week, the Indonesia Forum in Auckland was attended by the Indonesian ambassador, more than 250 captains of New Zealand industry and an air of enthusiasm. The forum aimed to discuss the opportunities and challenges for New Zealand businesses in Indonesia which arise out of engaging with this important bilateral trade partner.

Strengthening diplomatic and trade ties is about far more than lip service; barring, perhaps, unforeseeable mineral discoveries, New Zealand will never be more than an economic minnow in global waters, so we must be creative and cooperative to form advantageous partnerships. Fortunately, we’re good at both.

So what are the hindrances to closer bonds and an expansion of trade with Indonesia? Chiefly, New Zealand must ensure that all environmental issues are in balance – that, from a sustainability standpoint, we can demonstrate best practice throughout the industry. Every company has its own way of characterizing this – what dairy giant Fonterra calls ‘traceability,’ we term ‘chain of custody’ – and the Government, along with business, must make the investment required. By 2030, Indonesia will be the world’s sixth or seventh most economically powerful nation, and New Zealand can’t afford to stumble on sustainability.

Knowing this, Cottonsoft has dedicated resources over the past five years to ensuring it meets best-practice standards. We have a strict chain of custody system in place and tolerate no illegal wood in our supply chain. This dovetails with the objectives of APP’s 2020 Roadmap to Sustainability, which focuses in part on the company’s firm position of responsibility in relation to high conservation value wood and the obligations of suppliers.

Additionally, from a trade perspective, Cottonsoft serves as a useful example to New Zealand businesses seeking to develop relationships with Asia Pacific affiliates or potential suppliers. For trade opportunities to be seized and maximized, industries need a picture of how these connections can be managed well.

Overall, the Indonesia Forum represented good progress between New Zealand and Indonesia. Relationships aren’t made overnight, and some rockiness is to be expected, particularly when there are distinct socioeconomic or cultural differences.

Likewise, Australia is facing issues of the day head-on with Indonesia. For example, Australian Prime Minister Julia Gillard recently began a bilateral discussion with Indonesia’s president, with people-smuggling high on the agenda. There is increasing evidence of healthy competition emerging between the New Zealand and Australian governments as to who can get closer to Indonesia faster, and that’s a good thing too.

There is a pleasing momentum in New Zealand trade relations at present, and more attention being given to our relationship with Indonesia than ever before. It is now up to New Zealand manufacturers, importers and exporters to ensure they measure up on sustainability as well as supply.