Indonesia Trade and Economic
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Heather GarvenIndonesia Trade and Economic
New Zealand's trade relationship with Indonesia is steadily growing. In the year ending June 2008, trade between Indonesia and New Zealand was worth NZ$1.78 billion FOB. Indonesia was New Zealand's seventh largest export market for the year ending June 2008, and the largest NZ export market in Southeast Asia. Within ASEAN, Indonesia is ranked New Zealand's fourth largest bilateral trading partner. The Indonesian and New Zealand markets are complementary and largely non-competitive. That said, there are sectors of mutual interest. For example, in forestry and wood products our bilateral trade is worth around NZ$200 million, almost equally divided between imports and exports. In 1998, Indonesia disestablished quantitative restrictions on dairy and meat imports.
Approximately 90% of New Zealand's exports to Indonesia are primary products (principally dairy products (about 40%), wood pulp, other wood products and meat). In the year ending June 2008, the value of New Zealand exports to Indonesia was NZ$958.7 million, up 47 percent on the previous year. New Zealand's dairy exports to Indonesia were NZ$408 million and paper and wood products were NZ$110 million. New Zealand's exports of frozen beef and of ferrous waste and scrap are two sectors that have rapidly expanded each year since 2002. New Zealand is one of Indonesia's leading suppliers of dairy products and the dairy industry continues to find new products to export to Indonesia, with whey products recently finding a sizable market. Exports of timber have also seen a significant expansion.
Indonesia's imports to New Zealand were valued at NZ$823 million in the 12 months ending June 2008, a 12% increase over the previous 12 months. Of the ASEAN countries, Indonesia is New Zealand's fourth-largest source of imports. In the year ending June 2008, New Zealand imported forest and wood products from Indonesia worth NZ$62 million. Indonesian exporters are rapidly increasing their share of the New Zealand market for petroleum oil (crude and refined), coal, and natural rubber, textiles, clothing and footwear. Crude oil, worth NZ$309 million in the 12 months ending June 2008, is Indonesia's largest single commodity export to New Zealand. The services sector offers considerable scope for growth, especially in the education sector.
New Zealand signed a Trade and Investment Framework (TIF) with Indonesia during former Trade Minister Hon Phil Goff's visit to Jakarta in August 2007. The first TIF working group meeting was held in Wellington between officials in July 2008. The TIF provides a basis for facilitating trade and investment flows between the two countries.
Business Linkages
The Indonesia Chapter of the ASEAN-New Zealand Combined Business Council, based in Auckland, promotes business relations between New Zealand and Indonesia, as does a similar organisation based in Jakarta. New Zealand and Indonesian government and business representatives met under the auspices of the Indonesia-New Zealand Joint Commission on Economic and Trade Relations (JETC), to facilitate business and trade relations. Based on agreement reached during the visit of President Yudhoyono in 2005, the JETC was elevated to a Joint Ministerial Commission, which met for the first time in Jakarta in May 2007.
Last updated: 24 February 2009
