Saudi-Indonesian Business Forum Tackles Economic Cooperation

During King Salman’s visit to the country, the Indonesian capital city of Jakarta hosted the Saudi-Indonesian Business Forum, organized by the Ministry of Trade and Investment, which set out to discuss areas of trade and investment cooperation between the two friendly countries.

Attendees of the forum included H.E. Indonesia’s Minister of Trade, H.E. the Saudi Governor of the Authority for SMEs Dr. Ghassan Al Suleiman, and H.E. the Saudi Vice Chairperson of the Council of Saudi Chambers (CSC) Eng. Shuwaimi Al Ktab.

The CSC Vice Chairperson pointed out during his speech the importance of promoting the historic and spiritual relations between the two countries, noting that he looks forward to Indonesia’s participation in implementing the Saudi Vision 2030, which offers opportunities in several sectors, including healthcare, housing, renewable energy, industrial equipment, tourism, mining, localizing oil and gas, and digital economy. Eng. Al Ktab stressed the importance of promoting bilateral trade relations and exploring available opportunities in the two countries, so as to achieve successful partnerships that benefit both nations. On this note, he pointed to the modest trade between the two countries over the last decade, which did not exceed US$ 5.2 billion in 2015, compared to US$ 3.7 billion in 2006. In addition to Indonesia peaking at No.16 among the Kingdom’s largest trade partners during those ten years, which urges both sides to intensify their dialogue in order to get Indonesia among the Kingdom’s ten largest trade partners in the upcoming years.

The CSC Vice Chairman additionally encouraged businesspeople on both sides to maintain bilateral meetings to boost bilateral trade and investment relations and facilitate free trade, enable Saudi products’ access to Indonesian markets, and overcome obstacles hindering the flow of trade and investment between the two countries. Obstacles include high tariff and non-tariff fees, high transportation and insurance fees for Saudi exports, lack of organized routes for transportation, lack of business delegation exchanges, and scarce information on business opportunities in the Indonesian market.

Al Ktab urged Saudi and Indonesian businesspeople to tackle issues of concern; strengthen business trust, seek convenient mechanisms to inform about business and investment opportunities through institutions representing the private sector in having to do with industrial areas possessing infrastructure that suits Saudi investors in Jakarta and other main Indonesian cities, encourage Indonesian contractors to explore standing giant development projects in the Kingdom; and expand the scope of investments for Saudi investors in Indonesia, particularly in the agriculture sector, and namely food security-related products, such as rice, wheat, fruits and vegetables,

Additionally, Al Ktab encouraged  creating Saudi-Indonesian joint ventures that invest in agriculture and contracting, organizing trade exhibitions for Saudi products in Indonesia and vice versa, increasing non-oil trade and services, transferring technology, opening export offices in both countries, creating joint ventures that support exports, and taking advantage of the investment environment in the Kingdom where FDIs increased from US$176 billion in 2010, to US$224 billion in 2015 – reflecting the attraction and viability of Saudi Arabia as an investment destination. He also encouraged finding convenient mechanisms to settle possible commercial disputes, and focusing on training programs and exchanging knowledge.

The meeting included a presentation on the Saudi Vision 2030, and a roundtable concerning both sides’ expertise in targeted sectors, as well as investment opportunities in the Saudi and Indonesian markets, from services, to petrochemicals, to tourism (including religious tourism), and foodstuffs.

The forum saw the signing of three agreements in healthcare, energy, haj and Umrah, housing, and advanced technology. Moreover, CSC and the Chamber of Commerce and Industry of Indonesia signed an MoU to create a Saudi-Indonesian Business Council to promote bilateral trade and investment. Per Al Ktab, the MoU reflects the two countries’ mutual interest in elevating their bilateral trade and investment; noting that the joint council will provide a platform for businesspeople on both sides to introduce business opportunities, and will help explore new areas of cooperation in targeted sectors.

Per the MoU, the joint council consists of representatives from the business sector in both countries, and holds regular meetings in both Riyadh and Jakarta. The MoU additionally states that the joint council will facilitate exchanging information concerning business and investment opportunities in the two countries, promote economic and industrial cooperation, submit recommendations and studies to concerned bodies to improve economic cooperation, and organize different events and exhibitions in both countries.