Brazil, the
largest economy in South America, expects to expand its cooperation with
Indonesia, Southeast Asia’s largest economy, as there is still enormous room
for growth in many areas, including agriculture and high-technology industry, a
high-level official says.
Undersecretary-general
for Asia of the Brazilian External Relations Ministry, Maria Edileuza
Fontenelle Reis, said that Brazil wanted to boost bilateral trade and
investment in Indonesia, its key partner in the Southeast Asia region, in the
near future as economic cooperation between the two countries was very much
complementary.
“In terms
of investment and trade, prospects are numerous. Our bilateral trade figure is
now more than US$3 billion and should reach beyond $4 billion by year’s end.
But the dynamism and dimensions of our economies are way beyond that,” she told
The Jakarta Post in an exclusive interview in Jakarta on Tuesday.
Reis is on
an official four-day visit to Indonesia, set to conclude on Wednesday, and
leading a business delegation comprising 17 representatives from the Brazilian
Ministry of Agriculture, trade promotion department and businessmen from the
energy, mining, civil construction and aviation sectors, such as mining firm
Vale and aircraft producer Embraer.
At 58.73
percent, Vale is the largest shareholder in PT International Nickel Indonesia
that has just been renamed PT Vale Indonesia.
Reis
explained that as one of the world’s largest beef producers, Brazil wanted to
export beef to Indonesia. Indonesia is reportedly seeking alternative sources
of cattle and beef imports to reduce dependency on Australia following a recent
suspension of its live cattle exports due to alleged mistreatment of cattle in
local slaughterhouses.
“We’ve
received an Indonesian team to discuss with our sanitary and phytosanitary
authorities about the possibility of opening the local market to Brazilian
beef,” she said, adding that exporting genetic materials for husbandry,
re-utilization of degraded soil and investment in the local biofuel industry
were also possibilities.
In the
high-technology sector, Brazil is also looking to raise its exports of
airplanes to Indonesia as well as to investing in the production sector.
“We have
already sold 16 aircraft to Indonesia and we could increase this number.
Indonesia is also very much interested in having some kind of technology-based
trade-off, for example the production of aircraft parts here, and we are
considering this possibility,” she said.
Embraer,
the world’s third-largest airplane producer after Boeing and Airbus, Reis said,
had studied the possibility of teaming up with Indonesian firms. Apart from
that, investment would also continue in the energy sector with Brazilian firms
engaging in building hydropower plants in Indonesia, she said.
Reis said
Brazil was interested not only in increasing exports and investing in
Indonesia, but also to increase imports, such as fertilizers, textiles and palm
oil and further Indonesian investment, including in infrastructure projects.
She said
that Brazil expected to sign a number of agreements soon, including on trade,
in a bid to forge closer cooperation.
The
agreements are set to be signed during the ASEAN Summit in Bali next month,
during which a large Brazilian business mission will be present to explore
business opportunities in Indonesia.
Bilateral
trade between Brazil, which has a gross domestic product (GDP) of approximately
$2 trillion and is the world’s seventh-largest economy and fifth in terms of
purchasing power, and Indonesia has grown significantly in recent years.
According
to Trade Ministry data, bilateral trade rose by 185.09 percent to $3.25 billion
in 2010 from $1.14 billion in 2006.
Indonesia
exports natural rubber, crude palm oil, paper and electronics and imports
soybean oil, sugar cane, cotton and iron from Brazil.
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