USTR Schwab and Indonesia Trade Minister Pangestu Announce Steps to Deepen Trade and Investment Relations

May 20, 2007



Washington, D.C. – United
States Trade Representative Susan C. Schwab and Indonesia’s
Minister of Trade Mari Pangestu today agreed to formally establish working
groups intended to deepen U.S.-Indonesia economic relations in four key areas:
intellectual property rights, agricultural and industrial goods, services and

Meeting under the United States-Indonesia Trade and
Investment Framework Agreement (TIFA) to discuss bilateral, regional and
multilateral trade issues, Schwab and Pangestu  directed the new working
groups to develop specific initiatives in these four areas to further enhance
trade and investment ties between the two countries.

“I am pleased that The United States and
Indonesia made additional progress in
deepening our trade and investment relationship in our meetings this week,” said
Amb. Schwab.  “We also discussed how we could work together to advance
ASEAN (Association of Southeast Asian Nations) integration and to help achieve a
successful outcome to the ongoing WTO Doha Round negotiations.
Indonesia is the largest
economy in Southeast Asia and a major exporter
of both agricultural and manufactured goods, so it has a lot to gain from a
successful Doha Round.”

Ambassador Schwab welcomed the continued cooperation
between the two sides under the bilateral Memorandum of Understanding (MOU) on
cooperation to prevent illegal transshipment of textiles and apparel through
Indonesia to the United
States.  The MOU, signed by Ambassador
Schwab and Minister Pangestu last September, provides for customs cooperation,
identification of textile and apparel manufacturers, and joint verification
visits to provide each country’s government with the information necessary to
stop textile and apparel transshipments.  

During the TIFA, the two sides reviewed the solid progress
made on implementation of the bilateral MOU to combat illegal logging and
associated trade, signed last November.  Since then, the two sides have met
to develop cooperation and agree on specific activities that will be funded with
the $1 million the United
States already has dedicated to the MOU. 
The MOU is designed to promote forest conservation by combating illegal logging
and associated trade and to help ensure that Indonesia’s legally-produced timber and wood
products continue to have access to markets in the United States
and elsewhere.

The meeting between Ambassador Schwab and Minister
Pangestu capped a full day of TIFA meetings between delegations from both
countries. The meetings covered a wide range of bilateral issues, including
investment, intellectual property, services, customs, transshipment of goods,
and agriculture.   During the meeting, Indonesia noted its intention to respect World
Organization for Animal Health (OIE) guidelines in determining access for
U.S. beef.  Ambassador Schwab
and Minister Pangestu also exchanged views on Indonesia’s new
Investment Law and the Indonesian government’s ongoing anti-corruption campaign,
which the U.S. Government strongly supports.  Business and government
representatives from the United
States and Indonesia also met under the TIFA to
exchange views on ways to further strengthen trade and investment links between
the two countries.


Indonesia is the United States’
31st largest trading partner.  Two-way trade totaled $16.5 billion last
year, a 9.3-percent increase over 2005. Two-way trade in services with
Indonesia totaled $1.6 billion in
2005, the latest data available.  U.S. foreign direct investment in
Indonesia was $9.9 billion in 2005,
the latest data available.

Indonesia also is a key player in
ASEAN.  In August 2006, the United
States signed a TIFA with ASEAN as a platform to intensify
our trade and investment relations with the ASEAN region, which is commercially
and strategically vital to the United States. With almost 600
million people and a combined GDP of $2.7 trillion, the ASEAN economies
constitute the sixth largest economic group in the world. ASEAN members include
Brunei Darussalam, Burma,
Cambodia, Indonesia, Laos, Malaysia, Philippines, Singapore, Thailand, and Vietnam.