Indonesia, EU to establish most modern trade agreement

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Antara | 18 July 2018

Indonesia, EU to establish most modern trade agreement

by Yashinta Difa Pramudyani

Jakarta (ANTARA News) - The fifth round of talks on the Indonesia-European Union Comprehensive Economic Partnership Agreement (I-EU CEPA) will prepare the most modern trade agreement, as it covers several specific issues not addressed earlier.

The fifth round of talks, which took place in Brussels on July 9-13, 2018, not only covered discussions on trade in goods but also the trade of services, investments, and other forms of cooperation, Trade Ministry`s International Trade Negotiations Director General, Iman Pambagyo, noted in a statement received by Antara on Wednesday.

Among the specific issues discussed were energy and raw materials (ERM), for which negotiations were held by Energy and Mineral Resources Ministry`s special staff for Investment and Infrastructure Development Prahoro Yulijanto Nurtjahyo and staff for Strategic Planning Yudo Dwinanda Priaadi.

The ERM negotiations are targeted for completion in September 2018.

ERM-related issues discussed cover EU`s keenness to secure access to energy and minerals from Indonesia, including ways to enforce the application of the mineral exit duty.

The discussion continued with the spotlight on Indonesia`s stance to prioritize state sovereignty in the management of energy and mineral resources.

"Related to raw materials, Indonesia aspires to increase the added value. It is mandated by the law related to export duty on minerals, and discussion on the matter involves several ministries, including the energy and mineral resources ministry, trade ministry, industry ministry, and finance ministry," Priaadi stated.

The second topic discussed related to the implementation of energy business activities, wherein the EU has sought certainty in doing business in Indonesia.

He explained that the EU had also put forth a proposal for oil and gas blocks not sold at auctions to be handed over directly to them.

However, Priaadi explained that such a step could not be taken, as current rules encourage companies to be competitive in doing business.

"Please follow the auction. If it is competitive and can provide the best proposal, it can be given (the right of management). The government continues to improve the ease of doing business activity," Nurtjahyo stated.

He also asserted that highlighting simplified policies and streamlined regulations, among others, will demonstrate Indonesia`s position in the ERM negotiations.

"It is very beneficial for the EU, so they finally know and can reiterate the perfection of the draft ERM proposal," he noted.

The third ERM-related issue discussed was that both parties also agreed to encourage the implementation of international standards in energy and mineral business activities, especially related to safety.

Furthermore, it was agreed to conduct various research activities, development, and innovation related to ERM, mainly concerning renewable energy and energy efficiency.

Related to the palm oil issue, after the conclusion of negotiations, Pambagyo conveyed that the EU-Indonesia negotiations are bigger than the palm oil issue, as they also concern the commodity trade in goods, services, investments, and other forms of cooperation.

Although in trade, the contribution of palm oil is quite large, but Indonesia is also looking to raise that of other commodities.

"We are continuing this negotiation, but we are still echoing our concern about palm oil, as we receive `discriminative` treatment there," Pambagyo noted.

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source: Antara