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Trade issues tabled as Indonesian delegation travels down under

As the chief executive of APP affiliates Solaris Paper Australia and Cottonsoft New Zealand, I was invited to join the Indonesian delegation that travelled with the Minister of Trade, His Excellency Gita Wirjawan, during his visit to Auckland and Canberra in the second week of October 2012. I found Pak Gita to be an urbane, charismatic and charming man, even during the five tedious hours we spent sitting on an Air New Zealand carrier jet waiting for pre-flight repairs to be completed.

Pak Gita’s visit may have been brief, but it had impact. He met with his respective ministerial counterparts, New Zealand’s Tim Groser and Australian Senator Craig Emerson, and all parties put their respective views on bilateral trade between the three nations on the table. The main reason for my involvement in the delegation was to help Pak Gita understand some of the barriers to and issues around these trade relationships.

On the Indonesian side, the talks to which I was privy were convivial, and remained so as we alerted Minister Groser to the importance of the New Zealand Government’s recognition of the potential threat to trade of an overactive environmental lobby. This is especially important when dealing with a country as large and complex as Indonesia, and one that is trying to form new standards and levels of transparency for sustainable practice. Indonesia is the world’s fourth most populous nation, and the 15th-largest economy (by GDP based on purchasing-power-parity).

Importantly, the size of the Indonesian economy is projected to rise to seventh-largest globally by 2030, putting Indonesia ahead of developed nations such as Germany and the UK.

Regarding Australia and its trade connections to Indonesia, the issues were much more identifiable. There were two primary areas of concern to delegates: first, the ongoing debate in Australia surrounding live cattle exports to Indonesia, which were banned for six months in 2011; and second, the Australian Government’s intention to pass the Illegal Logging Prohibition Bill 2012.

While Pak Gita stated that he recognized the need for Australia to have such a policy to address illegal logging, he felt it must not come at a cost of creating trade barriers, especially in relation to forestry and paper. He noted that Indonesia’s Wood Legality Verification System (SVLK) should be seen as constituting verification of the legality of timber products in accordance with leading global standards, and that the Indonesian Government would like to see SVLK acknowledged in the Australian bill.

It was clear that the value of APP is recognized by the Indonesian Government and that the two parties are seeking to assist each other where possible. I believe I speak for all participants in saying that I concluded the visit impressed by Pak Gita, who is Harvard-educated and extremely knowledgeable about global trade and economic issues. His advocacy for the fostering of closer trade relations between Indonesia, Australia and New Zealand was welcomed.