Indonesia deal study likely
Courier-Mail, Brisbane
Indonesia deal study likely
11 August 2006
(AAP)Australia and Indonesia are thinking about studying a free-trade deal between the two nations.
Business leaders in both countries want the governments of Australia and Indonesia to examine the pros and cons of a bilateral trade deal.
The suggestion came as Trade Minister Mark Vaile met his Indonesian counterpart Mari Pangestu in Canberra yesterday for annual bilateral trade discussions.
"The business community proposed that perhaps we start thinking ... about studying an Australia-Indonesia free trade agreement," Dr Pangestu said.
"All of these things really start with a feasibility study. Any bilateral agreement should be based on mutual benefits."
She was reluctant to rate the chances of an FTA getting to the negotiation stage.
"We need to start with the first step and examine the costs and benefits and see if we should take it to the next level," she said.
"We need to now consider ... how and when it should be done."
One idea is for the scoping study to be part of the terms of reference for a joint expert group being set up by Australia and Indonesia.
"This joint expert group comprises of private sector and academics from both sides. So they could do the scoping exercise and come back to us," Dr Pangestu said.
"Most of these things do start with an academic study."
Most of Indonesia’s trade deals are being negotiated through the Association of South-East Asian Nations (ASEAN). It is currently only in negotiations for a bilateral agreement with Japan.
Australia and New Zealand are currently in negotiations with ASEAN - of which Indonesia is a member - on a free-trade deal.
Dr Pangestu acknowledged that those talks could call into question the need for another agreement.
"Is there added advantage to having a bilateral one on top of the ASEAN one? That is certainly a very valid question," she said.
A spokesman for Mr Vaile said Australia and Indonesia had agreed to form an experts group to explore ways to further improve the economic relationship.
"The FTA scoping study proposed by business for the experts group is one option we have agreed the experts group might explore," he said.
"This proposal reflects confidence in an economic partnership which continues to grow and prosper."
