A trade agreement between Indonesia and Australia has been hailed as a timely signal to the world about the importance of free trade. The Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA) was signed on March 4, 2019 in Jakarta.

The IA-CEPA will allow 99% of Australian products to enter into Indonesia tax-free or with significantly improved preferential agreements. All goods from Indonesia will enter into Australia duty-free.

This free trade agreement between Indonesia and Australia has been in talks for eight years and has seen five Australian prime ministers leading the negotiations.

The agreement will open new agricultural and educational opportunities between the two nations. The IA-CEPA allows automatic import permits for grains, meat, citrus fruits, and horticultural products, and grants Australian universities and vocational training institutions the ability to operate in Indonesia.

In addition to benefitting from the elimination of all tariffs on Indonesian imports into Australia, Indonesia will also enjoy an increase in the amount of work and holiday visas granted to Indonesian citizens. Working visas granted to Indonesians travelling to Australia are expected to increase from 1,000 to 4,100 in the first year, before growing to 5,000 in six years.

According to the joint statement of Australia’s Prime Minister Scott Morrison and Minister for Trade Simon Birmingham, the IA-CEPA builds on multiple trade deals, including the ASEAN-Australia-New Zealand Free Trade Agreement. Australia’s recent participation in free trade agreements have led to a $22.2 billion record trade surplus in 2018. As one of the fastest growing economies in the Indo-Pacific, Indonesia presents another significant opportunity for increased market access for Australian businesses.

To read more about this FTA please visit Australian Mining, VOA and the Australian Government official site.