05 April 2006

United States, Indonesia Strengthening Economic Ties, Says USTR

Portman says initiatives are building blocks for future free trade agreement

By Todd Bullock
Washington File Staff Writer

Washington -- The United States and Indonesia are strengthening bilateral economic ties through a number of initiatives and pledges for increased investment, says U.S. Trade Representative Rob Portman.

These initiatives are "building blocks" that will allow both countries to consider deepening ties through a free trade agreement, Portman said April 4 at a Washington press conference with Indonesia's Trade Minister Mari Pangestu.

According to Portman, bilateral trade between the United States and Indonesia totaled $15.1 billion in 2005. He noted Indonesia is also part of the 10-member Association of Southeast Asian Nations (ASEAN), which collectively represent the fourth-largest market for U.S. exports.

"As the largest majority Muslim country in the world, Indonesia's continued engagement with its neighbors in Asia as well as the United States can serve as a model for political cooperation between countries with diverse populations and different traditions," the USTR said.

The trade officials completed intensive discussions on the U.S.-Indonesia bilateral Trade and Investment Framework Agreement (TIFA), which included negotiations towards an agreement to combat illegal logging and trade in endangered species, according to Portman.

"This is a unique opportunity to strengthen our cooperation with Indonesia to better protect Indonesia's forests and sensitive habitats from illegal logging," Portman said,  "In addition, Indonesia has demonstrated a strong political commitment to addressing the problem and has asked the United States to partner with it on this important effort."

Both countries will seek to take concrete steps such as increasing law enforcement and promoting public-private partnerships to tackle pressing environmental problems while facilitating trade, he said.

CUSTOMS AGREEMENT REACHED

Portman also announced a bilateral customs agreement between the United States and Indonesia. The customs agreement allows for greater exchange of information, intelligence and documents that will assist countries in preventing and investigating customs offenses, he said, adding, "Such a framework is vital because of the explosive growth in the volume and complexity of international trade."

Portman and Pangestu also held discussions on strengthening cooperation against intellectual property rights violations.

"In my view, Indonesia has made progress in the area and we look for that to continue," Portman said.

The trade officials completed a memorandum of understanding that is intended to help prevent improper transshipment of Indonesian commodities such as shrimp and textiles to the United States.

"We also further explored how Indonesia can access the Millennium Challenge Account to provide capacity building which will support and endorse greater trade and investment relations," Portman said.

Portman said the United States looks forward to building a strong political and economic relationship with Indonesia and working to spur economic growth and raise living standards for people in both countries.

The transcript of the press conference is available on the USTR Web site, as is the full text of the press release.

For additional information, see East Asia and the Pacific and Millennium Challenge Account.

(The Washington File is a product of the Bureau of International Information Programs, U.S. Department of State. Web site: http://usinfo.state.gov)