Indonesia’s Trade Mission to Chile Targets Trade Value of Nearly Rp 16 Trillion.
Jakarta – The Ministry of Trade led the Indonesian Trade Mission Delegation to Chile on May 9-10, 2024. The Director-General of National Export Development (PEN) at the Ministry of Trade, Didi Sumedi, stated that the trade mission aims to boost Indonesia’s trade value with South America through Chile.
This is a continuation of the utilization of the existing trade agreement between Indonesia and Chile, namely the Indonesia-Chile Comprehensive Economic Partnership Agreement (IC-CEPA).
“Through the utilization of the IC-CEPA trade agreement, the potential trade value between both countries can still be increased to US$1 billion (equivalent to Rp 15.9 trillion – at an exchange rate of Rp 15,977). The Trade Mission to Chile also serves as a contribution from the Ministry of Trade in supporting the National Export Enhancement Task Force, and Chile is one of the priority countries targeted for export growth,” Didi explained in his statement on Friday (5/17/2024).
“The Ministry of Trade is committed to continuously promoting Indonesian products to enter non-traditional markets, one of which is the South American region. Chile holds a strategic position among other South American countries as it can serve as an entry point for Indonesian products into the South American region,” Didi continued.
Didi conveyed that in this trade mission, there were nine business actors and associations participating. These business actors and associations operate in various sectors such as palm oil and its derivatives, pesticides, chemical products, vehicle spare parts, and packaging.
Meanwhile, the Indonesia-Chile business forum, attended by more than 70 Chilean business players, followed by one-on-one business matching between Indonesian companies and Chilean business players, has successfully recorded transaction potentials worth US$7.45 million or Rp 119.20 billion. The transaction potentials are generated from palm oil and its derivatives, motor vehicle spare parts, and plastic packaging.
Additionally, a business meeting was also held with the Confederation of Chilean Industries (Sociedad de Fomento Fabril/SOFOFA) and representatives of the Chilean Government in the field of international economic relations (Subsecretatia de Relaciones Economicas Internationales Chile/SUBREI).
The meetings aimed to encourage the involvement of Indonesian and Chilean business players, as well as broader and mutually beneficial cooperation between the two countries.
As part of the trade mission to Chile, several business visits were conducted, including to Supermarket Jumbo, importer of Mannheim automotive spare parts, furniture importer Area Design, and Indonesian bicycle importer Cross Mountain.
Supermarket Jumbo, the largest retailer in South America, has imported noodle products from Indonesia with various variants and flavors. Supermarket Jumbo expressed interest in trying coconut products from Indonesia.
In response to this, Didi welcomed the interest and would facilitate a meeting between Jumbo and Indonesian companies producing coconut products.
Didi mentioned that besides food and vehicle spare parts, the potential growth of the furniture industry in Chile is also very promising. During the visit to Area Design, a prestigious furniture supplier in Chile, Didi found that 70% of its products originated from Indonesia. Didi believed that through the preferential tariff scheme of the IC-CEPA, which has entered the implementation stage, Indonesia’s furniture export performance to Chile will continue to increase.
“Moreover, Indonesian furniture products can compete in the Chilean market in terms of price with similar products from other countries,” added Didi.
Meanwhile, during the meeting with Cross Mountain, a renowned sports product importer in Chile, Didi invited Cross Mountain, which has also imported mountain bikes from Polygon Indonesia, to take advantage of the tariff reduction scheme of IC-CEPA in increasing the volume and value of bicycle imports from Indonesia.
“Bicycles are one of the products that receive preferential tariff reductions under the IC-CEPA scheme,” explained Didi.
Meanwhile, the Director-General of International Trade Negotiations (PPI) at the Ministry of Trade, Djatmiko Bris Witjaksono, explained that Chile itself is a country with a very open economy. Chile has signed 34 Free Trade Agreements (FTAs) with 64 countries, including Indonesia.
Djatmiko mentioned that IC-CEPA itself eliminates 89.6% of the total tariff lines. Therefore, Indonesian business actors can take advantage of it through the use of the Certificate of Origin (COO) Form IC-CEPA.
“IC-CEPA has had a positive impact on increasing the trade value between Indonesia and Chile by 21.73% compared to trade value before IC-CEPA,” Djatmiko said.