INDONESIA, SOUTH KOREA ENTER NEW STAGE OF BILATERAL RELATIONS by Fardah

Jakarta, May 25, 2016 (Antara)- Bilateral relations between Indonesia and South Korea have entered a new stage as the two nations celebrated the 10th anniversary of their strategic partnership agreement this year.

          The new stage was marked by the signing of several economic cooperation agreements, and various efforts were discussed to ensure mutual support in foreign, political, and global security affairs, according to South Korean President Park Geun-hye.  
     "The two countries agreed to deepen cooperation, especially in the fields of creative industry, maritime, and environment. Today, several memoranda of understanding were signed to create synergy in the cooperation," Geun-hye stated in Seoul, recently, after holding a bilateral meeting with President Joko Widodo (Jokowi), who had made a state visit on May 15-20.  
    South Korea is a strategic and key partner of Indonesia in Asia, President Jokowi stated, adding that bilateral cooperation in the fields of economy and industry had been proceeding smoothly.

          "Trade and investment between the two countries has been going well. Just now, we spoke about making investment in Indonesia. South Korea is interested to invest in the development of toll roads, harbors, railway tracks, power plants, and maritime infrastructure, among others," he noted.

          The head of state called on the South Korean government to facilitate fruit exports from Indonesia.

          At a business forum held in Seoul on May 16, Jokowi promoted Indonesia's potential areas of economic growth to hundreds of South Korean businessmen.

          Indonesia is currently building several infrastructure facilities, including highways, railways, seaports, airports, and irrigation dams.

          The infrastructure projects are not only being built on Java Island but also in remote areas, such as South Sumatra, Sulawesi, and Papua, he added.

          In addition, the president affirmed that the government was conducting a deregulation in the economic sector to facilitate ease of investment in businesses.

    "We will also carry out economic reforms, simplify business regulations and investment, and open up areas for economic cooperation," the president emphasized during the gathering attended by some 450 South Korean businessmen.

         Following the forum, the President conducted one-on-one business meetings with top officials of the Lotte Group and major steel producer POSCO.

        Seven memoranda of understanding (MoUs) were signed for establishing cooperation in several areas, including maritime, eradication of corruption, sports, and geospatial and peatland restoration, according to Indonesian Foreign Affairs Minister Retno LP Marsudi.

        The MoUs were inked by the ministers of both countries and witnessed by President Jokowi and President Park Geun-hye.

        During the president's visit to South Korea, Indonesia also saw strong commitment on the part of the South Korean government to enhance cooperation with Indonesia in various fields.

        Among the new areas of cooperation, to which the two countries are according priority, are expediting the pace of industrialization and developing the creative industry, she explained.

         In the meantime, the two countries signed several business agreements valued at US$18 billion, Head of the Indonesian Investment Coordinating Board Franky Sibarani said.

          The business agreements comprised investment commitments by six companies amounting to $15.8 billion and four memoranda of understanding (MoUs) valued at $2.2 billion.

         Sibarani explained that the business agreements covered the electricity sector, including renewable energy and industries, such as animal feed, filmmaking, footwear, and pharmaceuticals.

         "These business agreements demonstrate that South Korea has trust in Indonesia's potential areas of investment. The Indonesian government is conducting reforms in several regulations on investment of which some have run effectively," he remarked. 
     "President Joko Widodo affirmed that further steps will be taken to ensure that the business agreements can be realized. The board and the Indonesian Embassy in Seoul will monitor the realization process," Sibarani explained.

          The six companies that have established investment commitments are KOGAS in the gas infrastructure field, with a value of $10 billion; Lotte Chemical in the petrochemical sector, with $4 billion; and CJ Group in the animal feed and film industries, with $2.1 billion.

           The three other companies are Daewoong Pharmaceutical for manufacturing raw materials for the bio-pharmaceutical sector worth $100 million; Parkland in the footwear industry, with an investment of $83.5 million; and Posco for increasing the capacity of its phase II steel unit to 10 million tons.

           Meanwhile, the companies that signed MoUs for investment were KOGAS (South Korea) and PDPDE South Sumatra (Indonesia) for the construction of a gas pipeline from Tanjung Api-Api to Bangka Island worth $600 million and between KORBI and PT Coffindo for the development of solar power plants, with an investment of $100 million.

           The two other MoUs for investment were signed between Komipo, Posco Engineering (South Korea), and PT Sulindo Putra Timur (Indonesia) for developing a hydropower project in Southeast Sulawesi, with an investment of $230 million; and between Komipo, Samtan, PT Indika Multi International Energy, and Marubeni for the third phase of expansion of a power plant in Cirebon, West Java Province, with $1.27 billion investment.

         He also informed the media that Lotte Group is interested in increasing its investment in Indonesia to US$ 4 billion.

          "It is certain that before August 2016 all technical matters regarding the investment will be developed," Sibarani said after accompanying the President in a business meeting with the executive board of Lotte Group in Seoul.

          Lotte Mart also plans to expand its retail business in five major cities in Indonesia.

          A deputy at the Investment Coordinating Board (BKPM) Azhar Lubis stated that the BKPM will take several steps to follow up on the business agreements signed with Korean companies to accelerate their realization.

          The first step is that the BKPM representative, in coordination with the Indonesian Embassy in Seoul, will communicate with the Korean companies signing the business agreements, Azhar revealed. 
     "The communication will be initiated to obtain details of their investment plans in the country. Thereafter, we would coordinate with the related ministries or government agencies, including the regional administrations, to facilitate the investment plans," he affirmed.

          The swift three-hour investment licensing service is being offered to investors, with an investment plan of at least Rp100 billion, or creating at least one thousand jobs.

          So far, this year, 47 companies have availed the service, with a total investment plan of Rp110.7 trillion to create 34,735 jobs. 
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(T.F001/A/BESSR/F. Assegaf) 25-05-2016 13:01:12