- East Africa-Indonesia Preferential Trade Agreement on the horizon
Arusha, Tanzania, Wednesday 14th August 2024 – H.E. Tri Yogo Jatmiko, Ambassador of Indonesia accredited to the East African Community (EAC), paid a courtesy visit to the East African Business Council (EABC) and discussed the potential for negotiating preferential trade agreement between the EAC and Indonesia.
In his remarks, Mr. Adrian Njau, Acting Executive Director of EABC, stated that according to ITC Trade Map, the EAC’s total exports to Indonesia stood at USD 117 million in 2023, while imports were valued at USD 597.1 million making it unfavorable to EAC.
H.E. Tri Yogo Jatmiko noted that 60% of Indonesia’s trade is with Association of Southeast Asian Nations (ASEAN) countries, while Africa accounts for only 4%. Indonesia is the 15th largest economy globally, the largest in ASEAN, and a member of the G20 with a population of 280 million.
H.E. Tri Yogo Jatmiko emphasized that improving direct connectivity to East Africa will strengthen trade ties and engagements between business persons.
The Ambassador explained, Indonesia is committed to diversifying its sources of imports and advancing its economy by enhancing manufacturing output and expanding global trade ties.
EAC’s top exported products to Indonesia in 2023 were cocoa beans (USD 90.9 million), unmanufactured tobacco (USD 15 million), and skins and sheep of lamb (USD 3.4 million).
Imports from Indonesia included palm oil (USD 285.54 million), paper (USD 59.6 million), semi-finished iron products (USD 43 million), bulldozers and graders (USD 25.7 million), and machinery equipment (USD 10 million).
Mr. Njau said, “There is a growing interest in trade and investment between EAC and Indonesia. An economic agreement would provide preferential tariffs and open the Indonesian market to EAC products such as wheat, soybeans, rice, vegetables, cocoa beans, and food preparations.”
In 2023, Indonesia’s total imports from the world for wheat amounted to USD 3.8 billion, soybeans USD 1.5 billion, rice USD 1.7 billion, vegetables USD 743 million, cocoa beans USD 732 million, and food preparations USD 701 million. Of recently Indonesia investors have signed agreement with Tanzania authorities to establish multimillion fertilizer factory which will use available natural gas as its raw material.
The EABC is committed to partnering with business associations in Indonesia to promote trade and investment ties through joint exhibitions, conferences, and business missions.
Other areas of discussion included agriculture and agro-processing, education and capacity building, tourism and cultural exchange, technology transfer, and business and advocacy support.
