INDONESIA, VIETNAM TO STEP UP COOPERATION TO DOUBLE TRADE TARGET by Fardah

Jakarta, Feb 17, 2016 (Antara) - President Joko Widodo (Jokowi) and Vietnamese Prime Minister Nguyen Tan Dung have agreed to step up bilateral economic cooperation in order to realize the trade target of US$10 billion by 2018, almost doubling it from the 2015 level of US$5.3 billion.

         "In the field of trade and investment, we hope the two countries will step up cooperation to realize the trade target of US$10 billion by 2018," Jokowi said after the bilateral meeting with Nguyen Tan Dung. The meeting came on the sidelines of the US-ASEAN Summit in California on Feb. 15, 2016.     
    Indonesia ranks at number 29 in Vietnam's list of foreign investors, below Malaysia, Japan and South Korea.

         Prime Minister Nuyen Tan Dung told Jokowi that Vietnamese investors were interested in the fields of agriculture, oil and gas in Indonesia.  

    Dung extended an invitation to Jokowi to visit his country. "I take this opportunity to extend an invitation (to President Jokowi) to visit Vietnam," he stated.

       Jokowi expressed his intention to honor the prime minister's invitation to visit Vietnam this year.

         In the meantime, former Indonesian ambassador to Vietnam Mayerfas has called on the Indonesian companies, including state-owned enterprises, to be physically present in Vietnam to strengthen Indonesia's economic clout in Southeast Asia.

         "By choosing Vietnam as a base for Indonesian companies in Southeast Asia, we have a chance to benefit a market in Vietnam, which has a population of 92 million, as well as the markets of surrounding countries," the diplomat said in Jakarta on Feb. 16.

         Citing an example, he said state-owned cement company PT Semen Indonesia has been successful in developing business in Vietnam after it bought a cement factory there in 2013.

         The company has been able to supply cement to meet Vietnam's  domestic needs. Previously, Vietnam had to import nearly two million tons of cement annually, he said.

        The factory has also been able to access markets in Laos, Cambodia as well as Sri Lanka, Bangladesh and several African countries.

        "Therefore, we encourage other state-owned enterprises (BUMN) to be present physically in Vietnam as this will make Indonesia's economy strong regionally and will also enable it to dominate the Southeast Asian markets," Mayerfas said.

        At present, only about 20 to 30 Indonesian companies are fully operating in Vietnam.

         Thanks to its vast area and relatively cheap labor, Vietnam's foreign trade reached US$328 billion in 2015, 60 percent of it being foreign investment.

           The Indonesian diplomat is optimistic that the trade target of US$10 billion will be achieved, and that it may even be surpassed and reach US$12 billion.

        The bilateral meeting between Jokowi and Dung in California followed their previous talks held on the sidelines of the ASEAN Summit in Kuala Lumpur, Malaysia, on November 22, 2015.

       "Indonesia's investment in Vietnam is also growing rapidly to reach almost US$500 million. We hope the Vietnamese government would pay attention," President Jokowi affirmed last year.

       According to Ari Dwipayana of Jokowi's presidential communications team, the president has also offered Indonesia's strategic products to Vietnam, an offer that was welcomed by the Prime Minister.

       To further boost Indonesia's investment in Vietnam, the Indonesian Investment Coordinating Board (BKPM) said it will facilitate investment plans by both state and private companies in Vietnam as well as in other ASEAN member countries.

        "It is in line with the government's plan to benefit from the implementation of the ASEAN Economic Community," BKPM Chief Franky Sibarani  noted in a press statement last November.

        The BKPM estimated that Indonesian investment in Vietnam had already reached around US$2 billion, including US$500 million in the past five years.

        Based on data provided by the BKPM, there are 31 Indonesian companies investing in Vietnam in various areas, such as cement, medicines, property, packaging, paint, food, chemicals and freight forwarding.

          While seeking to attract foreign investment into the country, Indonesian state and private companies should also harbor regional and global ambitions, he emphasized.

         It is time for Indonesian companies to expand their operations abroad, he affirmed.

        "In fact, several state companies, such as Pertamina, Semen Indonesia, and Telkom already have business units abroad," he pointed out. 
  Bilateral relations between Indonesia and Vietnam have increased at a swift pace after the two inked a strategic partnership agreement in 2003.

        Key Vietnamese products exported to Indonesia include rice and crude oil while key Indonesian products exported to Vietnam are chemicals, pulp, textile materials, leather and fertilizers.

        According to Vietnam's Ministry of Industry and Trade, the two-way trade revenue between Vietnam and Indonesia reached US$5.4 billion in 2014. ***3***
(f001/INE)
EDITED BY INE/a014)17-02-2016 18:42:16