In a bid to ensure the longevity of their bilateral relations, Prime Minister Lee Hsien Loong and Indonesian President Susilo Bambang Yudhoyono have pledged to strengthen their countries’ cooperation in the areas of business, security, environment and education. The agreements occurred when they met this week for the Singapore-Indonesia Leaders’ Retreat.
Analysis by Singapore company formation specialist Rikvin shows that this year’s retreat builds on progress, particularly in the areas of air connectivity and agricultural trade, following the Bogor Retreat in March 2012. In addition, the retreat reaffirms that opportunities are abound for Singapore companies in Indonesia.
Commenting further, Ms. Christine Lim, General Manager of Rikvin said, “The retreat seeks to deepen Singapore’s long-standing bilateral and economic cooperation with Indonesia. According to IE Singapore, Indonesia was Singapore’s third-largest trading partner last year, with total trade amounting to S$79.4 billion. This signifies a S$1.4 billion improvement from 2011. In addition, Singapore hosts as many as 138,000 Indonesians. Many of them reside here as domestic workers, while others are students and professionals.”
In a bid to further enhance economic links, the two leaders encouraged their private sectors to collaborate on projects under Indonesia’s 2025 Master Plan for the Acceleration and Expansion of Indonesia’s Economic Development (MP3EI).
The areas that Indonesia seeks large scale investments in include shipping, textiles, food and beverages, steel, defense equipment, palm oil, rubber, cocoa, animal husbandry, timber, oil and gas, coal, nickel, copper, bauxite, fisheries, tourism, food and agriculture, the Jabodetabek area, the Sunda Straits strategic area, transportation equipment, and information and communication technology.
Analysis by Rikvin shows that the MP3EI aims to accelerate the development of 8 key programs in 22 activities so that its positive effects can be felt by all members of Indonesia’s population. The development will span across 6 economic corridors namely Sumatra, Java, Kalimantan, Sulawesi, Bali – Nusa Tenggara and Papua – Maluku Islands.
The areas that Indonesia seeks large scale investments in include shipping, textiles, food and beverages, steel, defense equipment, palm oil, rubber, cocoa, animal husbandry, timber, oil and gas, coal, nickel, copper, bauxite, fisheries, tourism, food and agriculture, the Jabodetabek area, the Sunda Straits strategic area, transportation equipment, and information and communication technology.
“Therefore, there are many opportunities for Singapore companies to offer their expertise in Indonesia. Having a base in Singapore means having access to the facilities and connectivity of a global city, and at the same time, having quick access to a high-potential market such as Indonesia.”
“Furthermore, Singapore companies should have a vested interest in Indonesia’s continued flourishing as it will contribute to enhancement of ASEAN economic pie as a whole, especially at a time where western economies are still not out of the woods. We anticipate that the business opportunities in Indonesia will encourage more enterprises to form a Singapore company,” affirmed Ms. Lim.
Other than economic cooperation, the two leaders discussed combating terrorism through the Counter-Terrorism Cooperation Working Group (CTCWG). They have also tasked their officials to facilitate talks for the early conclusion of maritime boundary delimitation in the eastern part of the Strait of Singapore. In addition, they concurred that territorial disputes in the South China Sea should be resolved in accordance with international law, such as UNCLOS. As well, they discussed enhancing diplomatic relations as well as mitigating the haze issue.
“Altogether the retreat is a strong indicator that both Indonesia and Singapore are committed to peace in the region as well as to create win-win opportunities for their industries and business communities. We anticipate that these efforts will contribute to Asia’s continued growth momentum, in spite of current challenges,” added Ms. Lim.
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