With impressive and consistent economic growth, a rapidly expanding domestic market, a growing middle class and abundant natural resources, Indonesia is becoming a political and economic powerhouse in South-east Asia, and around the world. Opportunities abound for Canada to play a part in Indonesia’s incredible success story. Sixty years ago, our two countries established official diplomatic relations, setting in motion a vibrant partnership. Today, we work together on a number of important issues, including counterterrorism, human rights and poverty reduction.
Our cooperation also extends to business, with trade and investment being a key dimension of our partnership. Indonesia is Canada’s largest merchandise export market in South-east Asia, while Canada buys a significant amount of rubber, apparel and electrical machinery from Indonesia. This activity is driving a substantial trade relationship, with bilateral merchandise trade reaching $3.1bn in 2011.
On the investment side, Indonesia is Canada’s largest investment market in South-east Asia. By the end of 2011, the stock of direct investment by Canadian companies had collectively reached over $3.6bn in Indonesia. When I visited Indonesia in 2011, I saw many instances of Canadian companies contributing to Indonesia’s economy in key areas. For example, I attended the grand opening of Manulife Financial’s new marketing office in Jakarta. You can also see the success of Canadian firms like Research in Motion, whose BlackBerry has become the dominant smartphone across the archipelago, or Talisman Energy and Husky Energy, which are helping Indonesians make the most of their country’s rich mineral resources and oil and gas reserves.
Our business together is about more than just numbers. It represents jobs, prosperity and opportunity for Indonesians and Canadians alike. After all, the global economic recovery remains at a fragile stage. Like Indonesia, Canada weathered the global crisis very well, and we believe partnerships, not protectionism, hold the key to lasting recovery for the global economy.
As the Indonesian economy continues expanding, we see great potential to expand our ties. During my visit, I took every opportunity to show our Indonesian partners what Canada can offer in key sectors like financial services, transportation, aerospace, information and communications technology, and natural resources. Canada’s team of trade commissioners is helping us spread the word. They work tirelessly to help Canadian firms build a presence in the Indonesian market and to raise awareness about Canada’s excellent growth prospects, low-tax business environment, and its talented, multicultural and well-educated workforce.
We want more Indonesian investment in Canada, and we think more Canadian investors should be looking at opportunities in Indonesia, as well. To help reach this goal, we are negotiating a Foreign Investment Promotion and Protection Agreement that will give investors from both countries the predictable framework they need to invest with confidence in each other’s market. More broadly, Canada is deepening our engagement with the members of ASEAN. With 10 economies accounting for over 600m consumers, a rapidly growing middle class, abundant natural resources and vitally important shipping lines, the region is becoming an influential force on the world stage.
We are also looking forward to joining the Trans-Pacific Partnership. Linking North America’s common production platform with the fast-growing supply and value chains of countries like Indonesia and the rest of the Asia-Pacific region will help our businesses become that much more competitive.
As the world looks for ways to create lasting economic recovery, Canada is convinced that increased trade and investment provides the single best way forward. Our many past successes and long history of cooperation convince me that the Canada-Indonesia partnership holds great potential to create jobs and prosperity in both countries in the years ahead. It is up to us to harness this potential for the good of Canadians and Indonesians alike – and the time is now.
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