JAKARTA, July 6 (Xinhua) -- The free trade deal between Indonesia and Australia that completely removes most trade tariffs for the products of the two nations and aims to ramp up investment has taken effect, Indonesian Trade Minister Agus Suparmanto said here.
The Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA) which took effect on Sunday was inked in 2019 and ratified by the Indonesian parliament in February, 2020.
Indonesian exporters would take advantage of the deal as all the country's export products will be untaxed in Australia and the industries in Indonesia will get raw materials with lower costs as the import tariff for Australian products are also deleted in Indonesia, Indonesia's Trade Ministry said in a statement received on Monday.
The trade minister encouraged entrepreneurs to take advantage of the trade deal in a bid to cast a pickup in the business activities which have been stretching deep during the novel coronavirus pandemic.
"The preferential tariff of the IA-CEPA must be used by the Indonesian entrepreneurs to bolster exports and boost competitiveness," Suparmanto said.
The trade volume of the two neighboring countries settled at 7.8 billion U.S. dollars last year.
The deal was expected to drift up Indonesia's exports to Australia, such as those of automotive products, textile and electronics, and Australia's exports to Indonesia, including those of wheat, diary and iron ore.
The IA-CEPA encourages the entry of the Australian investors into Indonesia and protects the Indonesian investors in expanding business to Australia.
The Indonesian Trade Ministry has issued three regulations to allow the imposition of the deal. Enditem