RI, Africa Have Good Political Ties But Lack Economic Coop

Jakarta, Dec 19 (ANTARA) - Indonesia and Africa have long been tied with good political relations, thanks to the establishment of Asia-Africa conference in Bandung, West Java, in 1955 that marks Indonesia`s support for the development of the African nations. However, the 50 years of good relations does not apply to trade cooperation between the two sides. In 2011, two-way trade between Indonesia and Sub Saharan Africa (consisting of 42 countries, excluding North African countries) only reached US$9.5 billion. The figure is relatively small if compared to trade between Indonesia and India in the same year which reached US$17.6 billion. "The problem is perception that is already set in the mind of the peoples of both sides. Many Indonesians see African countries as poor nations with a lot of political turmoil. Meanwhile, in Africans` view, Indonesia is too far that it is hard for them to do business there," the director for African affairs at the Indonesian Foreign Affairs Ministry, Larso Simbolon, said. Contrary to what most Indonesians believed, Larso explained African countries have been growing economically over the past years, with countries such as Angola, Nigeria, Rwanda and Ethiopia recording robust economic growth. According to the analysis reported by The Economist magazine and the International Monetary Fund (IMF), seven African countries (Ethiopia, Mozambique, Tanzania, Congo, Ghana, Zambia and Nigeria) will be among top ten of the world`s fastest growing economies from the period of 2011 until 2015. With traditional markets, namely the United States and European countries being hit by economic slowdown, Indonesia needs to intensify its economic cooperation with non-traditional markets such as African countries. "This is the chance for Indonesia to boost its trade and economic relations with the African nations. The sincerity and spirit of the Asia-Africa Conference in 1955 must be translated into mutually beneficial economic relations," he said. Among the Indonesian commodities which have market potentials in Sub Saharan Africa are consumer goods, textiles and textile products, crude palm oil, paper products, furniture and lubricant. "An Indonesian instant noddle brand is already famous in Nigeria. Likewise, CN-235 planes made by state-owned aircraft manufacturer PT Dirgantara Indonesia have already penetrated the Burkina Faso and Senegal markets," said Larso. Currently, Indonesia is also marketing its electronic products to some African countries. Director General of High Technology-Based Industrial Products at the Industry Ministry Budi Darmadi said Indonesian electronic products entered the African market through ports in South Africa. "Indonesia is relying on electronic products like television sets, audio equipment and room air conditioners. From the South African ports the Indonesian products are distributed to the rest of Africa, including Cameroon, Nigeria, Senegal and Ivory Coast," he said. He said South Africans prefer Indonesian products because they have better quality than those of China. "Indonesian products in South Africa have much bigger market share than that of China`s. Africans do not like goods of low quality," he said. In view of that, Budi said, electronic products have a good chance to boost Indonesia`s exports to Africa. The urgency for Indonesia to penetrate non-traditional markets was also voiced by Chairman of Indonesian Businessmen Association (APINDO) Sofjan Wanandi. He called on Indonesian exporters to switch the focus of their exports from traditional markets, such as the United States, to new markets in Africa and East Europe. However, Wanandi added that Indonesian products have difficulties penetrating the new markets due to a lack of promotional campaigns. "Our shortcoming is (a lack of) promotional activities. So far, we have left the job to businessmen. That`s not enough," he said. Meanwhile, Trade Minister Gita Wirjawan said Indonesia`s exports to African countries have shown positive progress. Yet, the absence of national banks that directly support trade with African countries remains a challenge. Most African countries use European banks for trade financing. Therefore, Gita asked Indonesian banks to be more serious in financing trade, particularly with non-traditional export markets such as African countries. "It is difficult for us to conduct trade missions without the support of our national banks," the minister said. High import duty is the other challenge faced by both sides to improve economic ties. African countries are imposing 30 percent duty on the import of finished goods, while Indonesia wants the duty lowered to only five percent.