The Indonesian Minister of Trade Muhammad Lutfi and Secretary of State for International Trade United Kingdom Elizabeth Truss signed a Memorandum of Understanding on the Establishment of the Joint Economic and Trade Committee (JETCO) virtually on Monday (26/4/2021).
The signing of JETCO opens opportunities for greater trade cooperation in the future.
"The signing of JETCO marks a new chapter in bilateral relations between Indonesia and the UK. It is hoped that the two countries can encourage the improvement of bilateral economic relations in the future, assist the entry of Indonesian goods and services into the UK market, and encourage British investment in Indonesia, "said Trade Minister Lutfi through his official statement.
To note, the total trade between Indonesia and UK in 2020 is USD 2.2 billion. In January-February 2021, it was recorded at USD335.70 million. Of this amount, Indonesia's exports to the UK amounted to USD201.86 million, while Indonesia's imports from the UK amounted to USD133.83 million.
Indonesia's main export products to the UK include footwear with outer soles made of rubber, plastic and leather; palm oil and its derivatives; and footwear with an outer sole of rubber, plastics, leather, or composition leather with a textile upper.
Meanwhile, the formation of JETCO was the result of recommendations from the Joint Trade Review (JTR) conducted by Indonesia and the UK. The JTR is a joint study carried out to formulate recommendations in order to increase the trade and investment sector by identifying potential sectors, as well as obstacles and opportunities for existing cooperation.
The preparation of the Indonesia-UK JTR began in December 2019 and the JTR Report was finalized in mid-April 2021.
“JETCO is an important milestone in enhancing the Indonesia-UK partnership. We hope that in the future the two countries can improve their economic and trade relations together through a trade agreement, "said Trade Minister Lutfi.
To date, the two parties have identified nine potential sectors along with barriers and opportunities for cooperation, namely education, food and beverage, agricultural products, technology, medicine and health care, infrastructure and transportation, timber and wood products, renewable energy, services finance and professionals, as well as the creative economy.
JETCO is considered important as an annual ministerial level dialogue forum to discuss bilateral issues of the two countries more intensively and with focus, while ensuring that JTR results can be followed up.
The JETCO mechanism will be preceded by a working group (WG) meeting at the senior officials level. Going forward, Indonesia and the UK will be able to explore the possibility of a higher economic partnership, such as a trade agreement.
After the signing, Trade Minister Lutfi and Secretary Truss accompanied by their respective delegations held virtual bilateral meetings to discuss the follow-up to the signing and JETCO's plans for the future. The two ministers agreed to plan JETCO's first meeting in July 2021 in Indonesia.
"The meeting is very important because it is an opportunity to determine the direction of bilateral relations in the future for the two countries," explained Trade Minister Lutfi.
Also attending and witnessing the virtual signing event were Director General of International Trade Negotiations Djatmiko Bris Witjaksono, Director General of National Export Development Kasan, Indonesian Ambassador to Britain Desra Percaya, and Deputy Chairperson of the Indonesian Chamber of Commerce and Industry (Kadin) for International Relations Shinta Widjaja Kamdani.