Australia and Indonesia have successfully concluded negotiations on the Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA). The agreement includes several important provisions to encourage bilateral trade and investment partnerships in mining and resources services along with a range of other industries.
These measures will create a larger scope for Australia’s world-leading mining services firms to partner with Indonesian businesses in developing that country’s extensive minerals and energy resources. It will also provide new export opportunities for Australia.
A provision which will benefit mining and mining-related services include Indonesia’s commitment to improving market access for construction services, including mine site construction, technical testing and analysis services and engineering services.
The agreement’s tariff reductions on goods also assist with eliminating Indonesia’s 5 per cent tariff on copper cathodes and will significantly reduce tariffs (or remove them all together) on a range of steel products, improving market access for these resources-based commodities.
The Minerals Council of Australia (MCA) said the provisions of the IA-CEPA now allows Australian firms to own up to 67 per cent of contract mining and mine site preparation services in Indonesia. Tania Constable, CEO of the MCA said the agreement will add to the enormous potential growth in the bilateral trade and investment relationship between Australia and Indonesia in coming years.
“Indonesia is one of the fastest-growing economies in Southeast Asia with a population of more than 260 million,” she said, “given the strategic importance of the relationship between Australia and Indonesia, finalisation of this agreement is a milestone for Australian trade policy.”
The agreement was also welcomed by the Australia Indonesia Business Council (AIBC), an organisation involved with the promotion and facilitation of trade and investment between Australia and Indonesia.
“The Australia-Indonesia relationship is an important yet historically underdone one, and this agreement promises to kick-start a new era of trade and investment between our countries,” said Phil Turtle, National President of the AIBC.
More information on the Indonesia-Australia Comprehensive Economic Partnership Agreement can be found here.
