Post Brexit Referendum and its potential implications toward Indonesia-EU CEPA Negotiation

APINDO under the International Relations Division held the International Trade Forum themed Post-Brexit and the future UK-EU trade deals: The Potential Implications in Indonesia-EU CEPA Negotiation on Wednesday, August 10th 2016.

This agenda was aimed to raise the awareness of the APINDO's members regarding to the impacts of the market turmoil caused by Brexit Referendum, especially in their respective business services and the possible impact to the recently started ID-EU CEPA negotiation. Member's exposition to this current issue would benefit ideal future trade deals for Indonesia to EU and the UK. The forum was also explaining the implication during the post-Brexit.

Delivered by the lecturer of Airlangga Institute for International Law Study, Intan Soeparna delivered her insights that Brexit will have no significant effect to Indonesia. She stated that since UK will become a single player after Brexit, it is a right time for Indonesia to have ideal trade deal with the UK. For EU-Indonesia CEPA negotiation, Brexit would not be a challenge since the negotiation is ongoing. However, she reminded Tariff, Trade in Service and Foreign Direct Investment shall be the main concern for Indonesia position in a sense that Indonesia products may face higher import tariff in the UK after it is completely out of EU in the next two years.

In line with Intan, the Head of Center for Policy Analysis and Development on American and European Region Ministry of Foreign Affairs (P2K2), Leonard F.Hutabarat, also mentioned that Brexit referendum will have no significant effect to Indonesia.

He purposed three recommendations, as followed: 1) Indonesia shall negotiate bilateral Free Trade Agreement (FTA) to anticipate significant policy changes in the UK; 2) Indonesia shall capture gain from capital outflow resulted by economic uncertainty in post-Brexit where investors are trying to relocate their investment; and 3) Indonesia shall aware and anticipate domino effect of Brexit whereby some of major trading partners like ASEAN, EU, China and the US will be affected significantly.

Furthermore, Director of Directorate of American and European Intra-Regional Cooperation Ministry of Foreign Affairs, Dewi Gustina Tobing elaborated about the current strategic Indonesia-UK relations. She uttered that there will be no significant trade loss from EU or the UK. However, the number of trading will be separated between EU and the UK. She suggested that Indonesia shall proceed to negotiate ideal trade agreement with UK (separated from Indonesia-EU CEPA negotiation). Regarding to capital outflow, she argued Indonesia is very attractive to foreign investors as a result of Tax Amnesty.

This fruitful discussion between the audiences and the speakers brought would be enhanced further by conducting other forums with several issues to be discussed. The upcoming forum is scheduled on September 14th, 2016.  

Post Brexit Referendum and its potential implications toward Indonesia-EU CEPA Negotiation

Selasa, 16 Agustus 2016 |