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Friday 18 Aug 2017 | 21:03 | SYDNEY
Friday 18 Aug 2017 | 21:03 | SYDNEY

Gillard Indonesia visit bears some fruit

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3 November 2010 15:21

In a Lowy Institute Policy Brief calling for a 'step change' in Australia's relationship with Indonesia, published in March this year, Fergus Hanson said the two countries should 'negotiate a multi-decade vision for the economic relationship' which goes beyond a free trade agreement:

Australia and Indonesia could use a similar time horizon [to the Australia-New Zealand CER] to set out a common approach for integrating the two economies. While the agreement could be non-binding, it would set out for both countries a clear vision of where the economic relationship is headed and guide ongoing efforts to reduce internal barriers to expanded trade. The option to negotiate detailed commitments could be done gradually over a long period of time.

This is from yesterday's joint statement by the Prime Minister and President Yudhoyono:

Both Leaders agreed to commence negotiation of an Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA).

The agreement appears to be more ambitious than the previously planned FTA. As the Australia-Indonesia Business Council puts it:

The scope of the proposed CEPA is much broader and more strategic than a traditional Free Trade Agreement. A CEPA seeks to bring the two economies closer together, covering investment and industry cooperation; dealing with "behind the border" issues that frustrate business; and delivering significant capability transfer initiatives.

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