United Kingdom trade envoy Richard Graham, center, in Jakarta on Tuesday (22/08) reaffirmed the UK’s commitment to be a reliable trade partner for Southeast Asia's biggest economy and said more cooperation is possible post-Brexit when the UK finally leaves the European Union. (Photo courtesy of the United Kingdom Embassy in Indonesia)
UK Envoy Talks Indonesia-UK Bilateral Trade Post-Brexit
AUGUST 23, 2017
Jakarta. United Kingdom trade envoy Richard Graham reaffirmed in Jakarta on Tuesday (22/08) the UK government's commitment to be a reliable trade partner for Indonesia and said more cooperation is possible post-Brexit when the UK finally leaves the European Union.
Graham also encouraged Indonesia to open up more trade opportunities to attract more British investment.
In an exclusive interview with the Jakarta Globe, Graham spoke about the importance of the ease of doing business, including making it easier to obtain foreign work permits, reduce the negative investment list and evaluate long-term benefits for companies to conduct trade with Indonesia.
"When it becomes easier for companies to trade here, they will start thinking longer term, [considering possibilities of] joint ventures [which will make way] for technology and skills transfer – more benefits for the Indonesians," Graham said.
He also said Indonesia needs to develop strategic relations with foreign multinationals and explore ways to attract manufacturers to establish themselves in the country.
UK companies like GlaxoSmithKline and Dyson, Graham pointed out, have been manufacturing their products in other countries in the region, including Australia and Malaysia, opening up job opportunities and allowing those countries to take part in technological development.
According to Graham, Indonesia's Investment Coordinating Board (BKPM) is already well-aware of the potential in attracting UK businesses to the archipelago.
"So the question is really about trade policy structure […] We may need to develop either a long-term free trade agreement, or an economic partnership that will give framework to that relationship," Graham said.
However, the UK can only enter into formal trade discussions with other countries after it officially leaves the EU.
According to Graham, bilateral trade post-Brexit may focus on more specific areas, such as services and agriculture.
If Indonesia makes it easier for foreigners to work in the country, Graham said it will open up "new opportunities for professional foreigners, who are specialists in training and skills, to come here and build up more managerial skills in Indonesia," which will help Indonesia improve the quality of its human resources.
During his three-day visit to Jakarta, Graham also met with National Development Planning Minister Bambang Brodjonegoro, after which he said when it comes to development, the UK stands ready to contribute its extensive experience in high-tech infrastructure.
The UK will share its expertise in security equipment, engineering-related projects and infrastructure design to increase overall efficiency in big government projects.
Graham noted that like many other governments around the world, Indonesia faces challenges in implementation and delivery, especially in ambitious and complicated infrastructure projects.
Graham, who is in Jakarta from Tuesday to Thursday, is the UK's trade envoy to Indonesia, Malaysia, the Philippines and the Asean Economic Community.
In this visit, he is scheduled to meet a number of high-ranking Indonesian government officials, including Vice President Jusuf Kalla, BKPM chairman Thomas Lembong and State-Owned Enterprises Minister Rini Sumarno.
Britain is at the moment still negotiating an agreement on how it will officially leave the European Union, with hopes that it will be able to continue tariff-free and customs-efficient trade with members of the EU and protect about 40 percent of its total trade.
"We very much hope we will have the same trading relations with the EU without being a member of it, which is the bit we must negotiate," Graham told the Jakarta Globe.
As Indonesia continues discussions on a Comprehensive Economic Partnership Agreement with the European Union, the agreement reached with the regional bloc may serve as a "starting point" for future Indonesia-UK bilateral trade relations.
"[…] We will clone that over as a starting point for new UK-Indonesia relationship and then probably have discussions with Indonesia about how we can improve that deal," Graham said, adding that discussions will still take place even if Indonesia-EU discussions have not gotten very far by the time Britain leaves the bloc.
Graham noted that the UK is "encouraging both sides to reach an agreement" but that the EU is "never a quick negotiator."
Commenting on the United Kingdom's relationship with the Association of Southeast Asian Nations (Asean), Graham said in the future the UK can help the Asean Economic Community to improve standards in major areas, which in turn will help solidify and unite Asean.
In the important areas of financial services and regulatory framework, for example, the UK can help shape standards that will regulate how individuals with standardized skills and qualifications can work in Asean member countries.
"Our relationship with Asean has grown over the last decade […] and we hope they will grow in the future," Graham said, noting that relations may also deepen in the fields of creative media, professional services, aerospace and modern technology.