19/11/2014 - 05:04

Barnett blind on Indonesian trade

19/11/2014 - 05:04


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The state government’s decision to shut WA’s trade office in Jakarta is a retrograde step.

Barnett blind on Indonesian trade
MAJOR MARKET: WA shipped 53,800 tonnes of beef to Indonesia last year.

It is nothing short of ridiculous that Liberal MLCs have to stage a trip to Indonesia to show Premier Colin Barnett why the Western Australian trade office in Jakarta should not be shut.

Is Mr Barnett really that unaware of the importance of Indonesia to WA?

Even if he were not the state development minister, the man in charge of our international trade and investment relationships, he would have to try extremely hard to ignore the rise and rise of the Indonesian economy and its huge potential for this state.

Let me just remind him of a few key facts.

Indonesia is one of our key agricultural trading partners, notably for wheat, cattle and beef. The latter two were worth $91 million to the WA economy last year, as Mr Barnett's agriculture minister, Charles Baston, has pointed out.

Indonesia is our most important partner in the $236 million live export industry, followed by Israel, and the second biggest importer of our beef. WA shipped 53,800 tonnes of beef to Indonesia last year.

More importantly, the agricultural sector shows massive potential, considering the growth in the Indonesian middle class and their more expensive tastes in food.

Try to get your head around the staggering numbers involved – the Boston Consulting Group forecasts the Indonesian middle class to double in size from 74 million to 141 million people by 2030.

Think of the potential of a market that is already 29 times bigger than WA's total population and is developing a taste for international travel, consumer goods and investing in education.

Think of the growth we could target for our education services, an export market already worth more than $1.1 billion, and our international tourism industry, worth almost $2.5 billion.

By 2030, the Indonesian economy is also tipped to become the world's 10th biggest.

As a result, our closest neighbour will become the dominant South-East Asian power and a significant force in the Indian Ocean region.

WA was a trailblazer among Australian states when it became the first to establish its own trade office in Indonesia in 1992.

We now have a sister-state relationship with East Java and Bali has become virtually a second hometown for many Western Australians.

But Mr Barnett's decision leaves us with poor representation in South-East Asia compared with other states, among them Victoria, which has nine executive staff in Jakarta and Kuala Lumpur. Queensland opened a new trade office in Jakarta last year to try to capture more of the lucrative international student market.

Indonesia is a very important country to us and I believe it should be a significant partner in the diversification of our economy, boosting agricultural and services exports such as education and tourism.

The inauguration of President Joko Widodo last month marked the beginning of an exciting era for Indonesia and offers new opportunities for WA companies to forge strong trade and investment relationships.

We need a strong WA voice in Jakarta to look after the state's interests.

Mr Barnett needs to show some vision and keep the Indonesian trade office open. If anything, it should be expanded and better resourced.


Mark McGowan

Wa Labor leader


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