Monday, January 18, 2021

Indonesia opens market opportunity to Africa, beginning with Mozambique

Press Release : AMR Partnership / Image courtesy : Freepik



 The Ministry of Trade ("Kemendag") targets to ratify the Indonesia-Mozambique Preferential Trade Agreement (IM-PTA) next year. IM-PTA is Indonesia's first trade agreement with a country in the African region and is Mozambique's first agreement with a country in the Asian region.

 One of the urgencies of this trade agreement is the diversification of export destination countries, where it is hoped that the market share to the African continent is expected to be greater in the future. Deputy Chairman of the Chamber of Commerce and Industry ("Kadin") for International Relations,ShintaWidjajaKamdani also said that market opportunities in Africa are quite promising for the national industry. 

"Regarding market opportunities, least developed countries ("LDCs") and developing countries in Africa are promising for national industries even though they do not have large market shares such as traditional markets or high purchasing power". 

According to her, this is because these countries do not have too strict product standards so that national business actors do not have to bother to adjust business processes and take care of various matters related to standards of goods to enter the market.

 "This is very good for small and medium enterprises or business actors who are exporting for the first time. Indirectly we are encouraging Micro, Small and Medium Enterprises ("MSMEs") and national business players who are only good at home to expand into other markets," said Shinta.

 Not only that, she also said, trade competition in Africa is easier considering that only a few countries in Africa have manufacturing bases and only a few countries were willing to trade with the African region. This makes the competition less intense.

 "It would be better if the government also helps create an FTA / PTA or an affordable trade insurance scheme to cover some of the high trade risks with LDCs and developing countries in Africa," According to Shinta, with this government's move, business actors can be more interested and more confident in expanding their businesses to Africa.

See also : kontan.co.id

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