‘Indonesia has not expressed interest in FTA’
Jakarta Post, Indonesia
‘Indonesia has not expressed interest in FTA’
11 November 2009
Indonesia and the European Union signed a Partnership and Cooperation Agreement (PCA) on Monday that will bring Southeast Asia’s largest economy and the largest regional grouping in the world under one umbrella for cooperation on the economy, environment, education, human rights and democracy. The EU and Indonesia have a combined population of over 10 percent of the world’s population and bilateral trade between the two stood at more than US$29.8 billion in 2007. The PCA with EU will add to Indonesia’s existing strategic partnerships with Japan, China, India, South Korea and the United States. The Jakarta Post’s Lilian Budianto interviewed James Moran, director of the Asia Directorate at the European Commission on the sideline of a seminar on Indonesia-EU relations on Tuesday in Jakarta. Moran said the EU and Indonesia has discussed a possible free trade agreement under the ASEAN framework but this had stalled over some issues. Below are the excerpts from the interview:
Question: Is the PCA agreement with Indonesia the first between the EU and an Asian country?
Answer: We already have similar agreements with Central Asian countries but with Southeast Asian countries, this is the first one. We have negotiations underway with six other countries at the moment, including with China and ASEAN countries. With ASEAN, we have negotiations going on with Thailand, the Philippines, Vietnam, Brunei, which is just about to begin, and Singapore.
In addition, we have PCA negotiations with China, which have been underway for the last two years. They are at different stages of advancement; some are very advanced and some are just started, but this is the first one to be signed.
I am negotiating it from the European side and very much involved with the negotiations currently going on. This is very important that we do this, it’s not only for EU-Indonesia relations but for Asia in general. It shows that Europe is reaching out to Asia in a new more meaningful way and so it’s not an important event just for the EU and Indonesia but also for the wider region.
Do you concentrate on similar areas of cooperation in the other six negotiations?
Similar areas but in each country you have different preoccupation, and you have different priorities. So, you must take into account that when you are making agreements, these can best suited to each different country. But there are a number of common themes.
With Indonesia, we found many common themes and interests in terms of values. In matters such as human rights and democratization here in Southeast Asia, we found a lot of new areas for cooperation.
But we will also start in energy, transportation, ICT and a lot of others areas.
EU has put an emphasis on human rights conditions for its cooperation. What about the PCA with China and concerns over its human rights conditions?
We have had a human rights dialogue with China for a long time, for 14 years and we don’t always agree with China on human rights. It’s not a secret; we are not the only ones. We have been including the Americans that have disagreements with them also from time to time but I think there has been some progress that we can see with China over the years.
For example, we are against the death penalty in Europe; China still has the death penalty. But at least, in the last couple of years, they have reformed the system of execution and sentencing that we think is moving in the right direction.
We hope very much that they will see eventually the interest of doing well overall on this. There has been some progress in China, but clearly it is a debate that will go on for some time.
ASEAN-EU FTA negotiations have been stalled for quite a while. What’s the issue behind this?
The difficulty for the trade agreement with ASEAN rests on the ideal. It is the Rolls-Royce we are trying to buy. However, when we are looking into our wallets on both sides, we find that we don’t have quite enough money. In order to buy a Rolls-Royce we have to make a sacrifice on both sides and the difficulty is there that you have different ASEAN countries, different levels of development, different interests and different priorities on trade.
We have to come together to make it meaningful and that’s proven very very difficult. We are not going to give up on a regional agreement of some kind but we have to have a real FTA, not just an FTA label on an agreement because that’s what we do in Europe. We probably have to have different arrangement with different ASEAN countries. So, I think you will see a bilateral track open up on the FTA with different ASEAN countries very early next year.
There are two or three countries that are very interested already and we will continue to work on the regional track. So, perhaps in the long run is to first deal bottom up, build FTAs individually with countries interested in doing so and then perhaps try to get it to the regional level. So, we end up with some rather small tasks but once we work on it we will eventually buy a Rolls-Royce.
Will Myanmar with its poor human rights records still be an issue in relation to an FTA with ASEAN?
I don’t think Myanmar is still an issue in the course of the FTA because the level of development there is so low that there is no way we could have a reciprocal FTA with an economy of that order, apart from the political difficulties that we obviously have.
Will the EU also discuss an FTA with Myanmar because for the ASEAN-EU FTA to happen, it has to include Myanmar?
No, because they are not interested in an FTA and the level of development in Myanmar is far too low anyway for a reciprocal FTA. What I am talking about is individual countries that are interested.
Singapore and Thailand are interested in doing this and want to start bilateral discussions.
In the meanwhile, we will continue to look at the regional possibility; we want to have a regional agreement if we can possibly get one. We realize that it’s going to take a long time. Indonesia for the time being has not expressed interest (in an FTA), but we will see, may be later on.
