Australian Indonesia Free Trade Agreement

Austrade and a number of our partners have developed practical guidelines for Australian companies on key sectoral opportunities in Indonesia under the AI-CEPA. Check this section from time to time to see the latest information. Information on export and import opportunities under IA-CEPA, AANZFTA and other free trade agreements can be found on the FTA portal. This agreement will help diversify Australia`s trade and strengthen our economic and cultural relations with one of our closest and closest neighbours. Shortly after Indonesia ratified the agreement, Monash Australian University announced its intention to open a campus in Indonesia, becoming Indonesia`s first foreign university. [20] Indonesian economic observers have noted that the free trade agreement could lead to an increase in imports of agricultural products, including Australian beef, which could supplant the local beef industry. [21] The Australian Labor Party also challenged the terms of the contract on investor-state disputes and temporary work in Indonesia in Australia. [22] Australia offers considerable opportunities to develop its trade, investment and economic relations with Indonesia. The IA-CEPA contains clauses relating to bilateral free trade, investments, qualification visas, investor arbitration procedures, e-commerce and intellectual property protection. [1] Under the agreement, Indonesia will lift tariffs on almost all Australian products exported to Indonesia, while all Indonesian products exported to Australia will be duty-free. [2] Australian companies could hold a majority stake in Indonesian telecommunications, transportation, health and energy companies. In addition, the number of working holiday visas issued each year in Donesier would increase from 1,000 to 4,100 (then to 5,000[1] by 2026, and Australian universities could open Indonesian campuses. [3] “This is the most comprehensive bilateral trade agreement ever signed by Indonesia, and it will give Australian exporters a competitive advantage, particularly at a time when many are doing so harshly in the wake of the COVID-19 crisis.

Australia`s free trade agreement with Indonesia will finally come into force on July 5 and will give exporters a welcome boost amid the economic downturn caused by coronavirus. Australia`s two-way trade with Indonesia totaled $11.7 billion in 2018/2019, making it Australia`s 14th largest trading partner. Resources and agricultural products are one of Australia`s largest exports of goods to Indonesia, which is one of Australia`s largest markets for coal, crude oil, wheat and live animals. Australia says 99% of its exports to Indonesia will be duty-free in terms of value or have improved preferential access by 2020, compared with 85% under an existing trade agreement between Australia, New Zealand and 10 Southeast Asian countries. Indonesian exports to Australia will not face tariffs, but under the Southeast Asia agreement, it already enjoys largely duty-free access to the Australian market.

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