Indonesia eyes increased U.S. investment, trade after preference extension

FILE PHOTO: Stacks of containers are seen at Tanjung Priok port amid the coronavirus disease (COVID-19) outbreak in Jakarta, Indonesia, August 3, 2020. REUTERS/Ajeng Dinar Ulfiana

(Reuters) – Indonesia will see a significant boost in trade and investment from the United States as a result of Washington’s renewed trade preference facility with Southeast Asia’s largest economy, a top Indonesian official said on Sunday.

“The ambition of the government is to double (U.S.-Indonesia) trade in the next five years to $60 billion, while simultaneously encouraging U.S. investment,” said vice foreign minister Mahendra Siregar, who noted this came after over two years of negotiations.

The Office of the United States Trade Representative (USTR) said on Friday it had closed Indonesia’s eligibility review for access to the Generalized System of Preferences (GSP) facility, with no loss of previous benefits.

The GSP programme gives privileged trade status to developing economies.

Total two-way trade with the United States was worth $28.6 billion last year, according to Indonesian trade ministry data.

Mahendra told a press conference that the U.S. International Development Finance Corporation (DFC) was also “very interested” in investing in the country’s upcoming $5 billion sovereign wealth fund.