[ad_1]
Indonesia and the United Arab Emirates signed a free trade agreement that strengthens economic ties between Southeast Asia’s largest economy and the main oil-producing Gulf nation.
Friday’s deal, reached by Indonesian President Joko Widodo during a visit to Abu Dhabi, will remove or significantly reduce tariffs on most goods traded between Muslim countries.
The UAE Ministry of Economy said Indonesian palm oil, food, fashion and UAE petrochemicals, rubber products, plastics and steel would benefit from the reduction or elimination of tariffs.
Indonesia’s trade ministry said the agreement includes chapters on services, investment, intellectual property and mutual recognition of halal certification. The text of the agreement has yet to be released and still needs to be ratified by both countries, a largely authoritarian process. UAE, but in democratic Indonesia it could take months.
According to the Economic Complexity Observatory, Indonesia’s main exports to the UAE are palm oil, jewellery and precious metals, while the UAE’s exports to Indonesia are mainly LPG and non-crude, iron and non-alloy steel.
The oil-rich UAE has forged closer trade ties with Indonesia as part of its ambition to double its economy to $816 billion by the end of the century, in part by signing off on free trade agreement.
This year it signed similar deals with India and Israel.
UAE Economy Minister Abdullah bin Touk told reporters that the deal with Indonesia could increase bilateral non-oil trade to US$10 billion (RM44 billion) within five years from about US$3 billion (RM13 billion) last year. Ringgit).
Indonesian Trade Minister Zulkifli Hasan said Jakarta expects the UAE to make more investment in Indonesia following the agreement, which he said would boost exports to the Middle East and elsewhere.
A country of around 10 million people, the UAE is a major trade hub for the Middle East and Africa, Asia and parts of Europe.
The UAE will benefit from greater access to the Indonesian market of more than 270 million people as it diversifies its trade links and seeks to create jobs for its one million citizens.
The government estimates that the trade agreement will create 55,000 high-skilled jobs in the UAE by 2030, UAE Minister of State for Foreign Trade Tani Al Zeyoudi told Reuters.
“Our GDP will increase by about US$4.6 billion (RM20 billion) by 2030. Exports will increase by US$3.2 billion (RM14 billion) and imports by US$2.6 billion (RM11.4 billion) by 2030 Ringgit),” he said in an interview.
The UAE is in bilateral free trade talks with at least a dozen other countries, including Australia and South Korea.
“We are almost done with Colombia. It will be signed in the next few weeks,” Al Zeyoudi said, adding that Turkey could reach an agreement by the end of the year. — Reuters
[ad_2]
Source link