07 April 2011
The current size of mutual trade between Turkey and Indonesia, two of the world’s fastest growing economies, remains below the desired level and must be increased, President Abdullah Gül said Tuesday in Jakarta, where he called on Indonesian entrepreneurs to invest in Turkey.
Upon an invitation from Indonesian President Susilo Bambang Yudhoyono, Gül arrived on Monday in Indonesia, for his first visit there as the Turkish president. Speaking at a Turkey-Indonesia Business Forum meeting Tuesday in Jakarta, in which Yudhoyono also participated, Gül emphasized that the two countries “have more to discover about each other’s potential in trade.”
Mentioning a discrepancy in mutual investments between the two countries, he said: “Mutual trade volume between the two countries stands at $1.7 billion. … Turkish businessmen have investments worth $70 million in Indonesia, while Indonesian entrepreneurs’ investments in Turkey total only $600,000.”
“Indonesia, which has a gross domestic product [GDP] of more than $700 billion, a population of 250 million and rich natural resources, and Turkey, with its successful economy at the junction of Europe and Asia, should have a much stronger cooperation than they currently have,” Gül said. He said tourism is one of the important investments areas that entrepreneurs from both countries could also cooperate in. “The Turkish tourism industry could offer new horizons for their Indonesian counterparts by building new facilities and hotels in this country.”
He said Indonesian investors could enjoy free market conditions in Turkey, which has strong trade relations with EU members. Remarking that Turkey achieved 8.9 percent growth in its economy last year over 2009, he said the country is “last year’s champion in terms of the fastest economic growth among Organization for Economic Cooperation and Development [OECD] members.”
Turkey and Indonesia agreed to initiate comprehensive strategic partnership cooperation. Both countries are working on regulations to ease procedures on mutual trade. As Gül also mentioned at Tuesday’s meeting, the two countries are expected to sign a free trade agreement (FTA) in the near future.
Also speaking at the meeting, Yudhoyono reiterated Gül’s remarks that trade relations are below desired levels and said there is still much to do to improve relations. Underlining the beginning of “a new era” in relations with Turkey, he invited Turkish investors to take part in new investments in Indonesia. Indonesia expects the total size of new investments in the country to reach $300 billion within the following 15 years. “We would love to see Turkish businessmen get a larger share of this cake,” he noted.
$400 mln defense deal
A visit to Indonesia by President Abdullah Gül has already started to bear fruit even before his return to Turkey, with an announcement on Wednesday of the signing of a defense agreement deal worth $400 million.
The deal was signed between Murad Bayar, undersecretary of the Turkish Undersecretariat for the Defense Industry (SSM), and Indonesia’s junior defense minister Sjafrie Sjamsoed on Wednesday. Leading Turkish defense firms Aselsan, Roketsan and FNSS will take part in the agreement.
As part of the deal with Indonesia, Aselsan will produce wireless phones for the Indonesian army and Roketsan will develop ballistic missile systems. Additionally, FNSS will manufacture armored carriers for the Indonesian army. The three companies are expected to finalize projects within the following year. FNSS earlier agreed to sell 257 armored carrier frames for the Pars 8x8 armored vehicle to the Malaysian army.
Officials from SSM told Today’s Zaman that the two countries would enjoy an increase in mutual trade, currently around $1.7 billion, thanks to new investments in the defense industry.
Turkey has been taking initiatives to expand its existence in the Asian defense industry. As early as February, Turkish and Malaysian defense companies had signed a $600 million deal, making it Turkey’s largest single sale in defense industry exports. Malaysian companies also have several agreements for cooperation in the defense industry with Turkish companies MIKES, TUSAŞ and GATES. Turkey is now eying a similar achievement in Latin America. In this regard, SSM officials are gearing up for visits to Brazil, Chile, Colombia and Peru in the following days to discuss potential joint projects with these countries.