Diplomatic ties between Indonesia and Latin America countries have been going on through various cooperation schemes, such as Forum for East Asia – Latin America Cooperation (FEALAC) and Pacific Alliance. Even so, the low trade and investment between the two sides showed that strong economic cooperation has yet to take place.
“We have close political relations with Latin America. We have the same framework for politics at the grassroots level. But this has not yet warmed up the trade and economic relations,” said International Relations lecturer from UGM, Dr. Riza Noer Arfani, on Friday (11/5) at Faculty of Social and Political Sciences UGM.
He said this during the Foreign Policy Forum organised by Institute of International Studies (IIS) UGM and Sociedad Indonesia para America Latina (SIpAL) of the Faculty, in cooperation with Indonesian Foreign Affairs Ministry.
The Forum discussed challenges and opportunities for cooperation between Indonesia and Latin America, especially through trade blocks in the Latin America, MERCOSUR. Riza said trade and investment intensity from Latin America was not yet significant compared to from partner countries in Asia, Europe, and North America. He mentioned that the economic policy direction under President Joko Widodo and current economic phenomena means open opportunities to increase trade and investment volumes.
“Seeing the current developments in global production network, actually opportunities are open wide. Initiative for south-south is also quite emphasised in this government, which can pave the way for trade opportunities with MERCOSUR,” he added.
Head of Sub-directorate III for Americas and Europe in the Foreign Affairs Ministry, Virdiana Ririen Hapsari, added that currently Latin America was one of target countries for Indonesia’s economic diplomacy.
“In line with the guidelines from President Joko Widodo, Indonesia opens exports to non-traditional markets, Latin America is one of the prospective markets for Indonesia. So, Indonesia has to be able to make use of the engagement with the Latin American countries, particularly through regional organisations,” she said.
Ririen explained the weak exploration of the market was caused by geographical condition and language barrier. Indonesia, she said, needs to develop connectivity with them through social cultural, people-to-people, and media connectivity.
“Latin America has bonus of demography, about a quarter of the total population (163 million population) are between 15-29 years of age, which becomes the regional driving force, especially in creative industry or small and medium businesses,” she said.
She viewed that opportunities are wide open for Indonesia-MERCOSUR. She asked the Indonesian businessmen, academics, media, and the young generation to be engaged in building such connectivity.