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China has agreed to lift the 15 percent import duty imposed
on Indonesian cocoa exports in a bid to further increase the two
countries' rising trade volume.
The removal of the import duty was agreed upon in the Memorandum of
Understanding signed by Indonesian minister of trade, Mari E. Pangestu,
and her Chinese counterpart, Bo Xilai, during a meeting in Nusa Dua,
Bali, on Friday.
The MoU was signed as part of the framework of the Joint Commission on
Economic, Trade and Technical Cooperation between Indonesia and China.
China was previously accused of discriminating against Indonesian cocoa
products. China lifted its import duties on Malaysian cocoa products,
but Indonesia products continued to be subject to a 15 percent import
tariff.
Indonesia is the world's third largest cocoa producing country after
the Ivory Coast and Ghana in Africa. The value of Indonesian cocoa
exports to China increased from US$10.9 million in 2004 to $16 million
in 2005.
During the meeting, China also pledged to provide 20 million yuan in
grants for the prevention and management of avian flu. The meeting also
marked the establishment of the Indonesia-China Joint Investment
Committee and the setting up of a special website on Sino-Indonesian
trade relations.
Figures from the Ministry of Trade show that China is now the fifth
largest export destination for Indonesia and the third largest source
of Indonesian imports.
Based on the figures, the total trade value between the two countries
amounted to $12.5 billion in 2005, triple the $4 billion recorded in
2001. This represents an average growth rate of 32 percent over the
2001-2005 period.
Indonesia enjoys a trade surplus with China that increased sharply to
$819 million in 2005 from $503 million in 2004.
In 2005, approved Chinese investment in Indonesia amounted to $205
million (84 projects) making China the 9th largest investor in
Indonesia.
The two countries have committed themselves to tripling the current
level of bilateral trade to $20 billion by 2008 and $30 billion by 2010.
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