Newsletter No. 657
News-Analysis
June 24, 2007

 

HIGH HOPES AND LINGERING DOUBTS: THE FORTHCOMING JAPAN-INDONESIA ECONOMIC PARTNERSHIP AGREEMENT

The seventh round of Japan-Indonesia Economic Partnership Agreement (EPA) negotiations was held at the Foreign Ministry building in Tokyo on the 21st and 22nd. The highest-ranking Japanese representative was Deputy Foreign Minister Masaharu Kono. The Indonesian side was led by Ambassador Soemadi Djoko Moerdjono Brotodiningrat

The Indonesian media is reporting that a final draft of the EPA has been agreed upon, and that it is now ready to be signed by President Susilo Bambang Yudhoyono and Prime Minister Shinzo Abe (or whomever else is in that post) in Jakarta in August.

One point of contention which apparently has not been resolved is the question of Indonesian laborers in Japan. The Indonesian government would like Japan to accept many more workers from their country, but Japan is famously resistant to the idea of foreign immigration to the Islands of the Gods.

On the other hand, according to an Antara report, Director-General for Workers Placement of the Ministry of Manpower Myra Hanartani said “there was a loophole the two countries could use to open Japan's work market. It was the loophole that could be utilized through certain format in the EPA, she said. ‘With that, Japan is now ready to receive nurses and attendants for tending its senior citizens.’”

It should be recalled that Indonesians already form the largest single Muslim community in Japan, making up over 35% of the total in 2004 according to the research of Hiroshi Kojima. He found that at that time there were more than 20,000 Indonesian Muslims in Japan, more than double the number of Bangladeshis, the second-largest community.

At any rate, the Indonesian Chamber of Commerce and Industry (Kadin) is putting high hopes on the EPA. Kadin Vice-Chairman Rachmat Gobel told the media: “In the past ten years Japanese investment in Indonesia has continued to decline. It is hoped the 50th anniversary of RI-Japan diplomatic relations will be a momentum for refreshing the two countries’ (economic) relations…

Japan has technology and much capital, while Indonesia has a lot of natural resources and a large market. If the two potentials are synergized they could become strong capital for increasing balanced and mutually beneficial cooperation.”

However, some harbor doubts that Indonesia will be able to fully utilize the opportunities that the EPA may provide.

Halida Mujani, special adviser for international cooperation at Indonesia's Trade Ministry, said, “Japan is still waiting for the promulgation of the new Investment Law and wants to know how it is implemented in the field. They are also closely monitoring developments in taxation and labor affairs in Indonesia.”

JAPANESE-MADE PATROL BOATS FOR MALACCA STRAITS SECURITY

Antara has reported that three Japanese-made patrol boats will be sent to the Indonesian Police in December. One of the three boats was launched earlier this month in the presence of Indonesian Ambassador Jusuf Anwar.

The three patrol boats are being constructed by the Sumidagawa Shipyard Company, a manufacturer of patrol boats, ferries, and medium-class warships. According to Antara, each of the three patrol boats is 27 meters in length, 98 tons in weight, can travel at 30 knots, and can carry up to 12 personnel.