Indonesia and Australia yesterday signed a long-awaited trade deal after months of diplomatic tension over Canberra’s contentious plan to move its embassy in Israel to Jerusalem.
Indonesian Minister of Trade Enggartiasto Lukita and Australian Minister of Trade Simon Birmingham wrapped up the multibillion-dollar agreement in Jakarta, about nine years after negotiations started.
The pact would include improved access for Australian cattle and sheep farmers to Indonesia’s 260 million people, while Australian universities, health providers and miners would also benefit from easier entry to Southeast Asia’s biggest economy.
Greater access to the Australian market is expected to spur Indonesia’s automotive and textile industries, and boost exports of timber, electronics and medicinal goods.
Bilateral trade was worth US$11.7 billion in 2017, but Indonesia is only Australia’s 13th-largest trading partner and the economic relationship has been viewed as underdone.
Both ministers touted the deal as indicative of deepening ties between the two countries, which have occasionally butted heads on foreign policy issues, including Australia’s hardline policy on asylum seekers.
The deal has been in negotiation since 2010 and was expected to be signed before the end of last year, but it stalled when Australian Prime Minister Scott Morrison in October proposed the relocation of Australia’s embassy to Jerusalem.
In December, Morrison formally recognized west Jerusalem as the capital of Israel, but said that the contentious embassy shift from Tel Aviv will not occur until a peace settlement is achieved.
Morrison stood by his decision, despite outcry from neighboring Muslim countries. Indonesia in response simply said it had noted the decision.
The agreement would eventually see the elimination of all Australian trade tariffs, while 94 percent of Indonesian duties would be gradually eliminated.
Australian investment in Indonesia totaled US$597 million last year, but that is expected to increase under the new deal, which also included provisions for greater protection of foreign direct investment.
“Indonesia is a good market for Australia because of the large population [and] the increasing movement of the middle class,” said economist Kresnayana Yahya, from Surabaya’s ITS university.
The less developed eastern reaches of Indonesia could significantly benefit from Australian investment, he added.
The trade deal also came just ahead of national polls in which Indonesian President Joko Widodo is pushing his economic record in the battle for re-election.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by