Trade between Ireland and Indonesia much more room for growth

Sean Kelly, MEP for Ireland South, has underlined the importance of fostering trade and investment relations with Indonesia, the largest economy in the ASEAN bloc. Kelly, speaking at the Inter-Parliamentary Meeting between MEPs and Members of the Indonesian Parliament, said that “trade between Ireland and Indonesia has much more room for growth”.

During the last 26 years, the exports of Ireland to Indonesia have increased at an annualized rate of 4.43%. Kelly added, “Ireland is also interested in enhancing people-to-people connections, including through intensifying education cooperation.”

The ASEAN region, a consortium of ten nations in the Indo-Pacific, represents a rapidly expanding market with over 600 million consumers. As a group, the ASEAN bloc stands as the EU’s third-largest trading partner outside Europe, trailing only behind the United States and China.

Mr. Kelly recognizes “the enormous economic and trade potential in the cooperation between the EU and Indonesia, particularly for countries like Ireland who export infant formula, concentrated milk and wide variety of agricultural products, including food and drink, such as our famous whiskey as well as medical and pharmaceutical products. There is a lot of potential for Ireland in South East Asia and more and more businesses are starting to see this”.

Indonesia, which constitutes approximately one-third of the ASEAN region’s GDP and boasts a population of 270 million inhabitants in 2020, holds a prominent position in trade negotiations. The EU is Indonesia’s fifth-largest trading partner.

The EU and Indonesia officially launched negotiations for a free trade agreement (FTA) in July 2016, but these have stalled over disagreements about Jakarta’s protectionism and the EU’s policies toward palm oil, a key Indonesian export.

Kelly stresses that “adherence to a rules-based multilateral trade system is of utmost importance for the EU, and the global trading system should not be manipulated to facilitate unfair trade practices. This is fundamental for the likes of Ireland who have an open economy that looks outward when it comes to trade.”

In relation to an ongoing trade dispute related to Indonesian nickel export restrictions, Kelly called on the Commission “to adopt appropriate and proportionate measures in response to Indonesia’s breach, but also to continue efforts to engage constructively with Indonesia to reinforce and strengthen EU-Indonesia relations.”

Kelly added, “When it comes down to it, we need to reduce dependence on China. This is done by diversifying our trade supplies and partners, so more trade in South-East Asia makes sense.”