Posted : 2013-10-11 19:03
Updated : 2013-10-11 19:03

Park eyes trade pact with Indonesia

President Park Geun-hye looks at Korean letters written by her late father and former president Park Chung-hee carved in a cornerstone at the Korean embassy in Jakarta, Indonesia, Friday. Park is on a three-day state-visit to the Southeast Asian country. / Yonhap
By Kim Tae-gyu

JAKARTA — President Park Geun-hye asked for an early conclusion to the stalled negotiations on forming a comprehensive economic partnership agreement (CEPA) with Indonesia at a meeting with entrepreneurs from the two nations, Friday.

The two sides launched talks on the CEPA, which is more wide-ranging than the free trade agreement (FTA), last July but has failed to make breakthroughs over the past year.

"To achieve the goal of reaching $100 billion in trade between the two countries, we need the framework of the CEPA. It will greatly contribute to expansion of bilateral trade and create a win-win model," Park said.

"Korea will closely cooperate with Indonesia to strike a mutually-beneficial CEPA as soon as possible. I call for the support of the businesspeople here." Last year, Korea exported products worth $13.9 billion to Indonesia while the former's imports from the latter amounted to $15.7 billion for a trade volume of $29.6.

"To achieve a joint goal of the $100 billion trade, it is a high time for us to take action," said Park.

She will meet her Indonesian counterpart Susilo Bambang Yudhoyono today. Park also visited the Jakarta office of Daewoo Shipbuilding and Marine Engineering (DSME), one of the world's largest shipyards with a big presence here.

"Under the some $1.1 billion deal of exporting three submarines to Indonesia, the DSME created an office in Jakarta to employ many young Indonesians so that they can learn about vessel design," Park's senior economic secretary Cho Won-dong said.

"Two submarines will be constructed in Korea but the third one will be built here so that Indonesia can get the technology transfer. This could be a model case for collaboration between the two countries' defense industries." On top of the DSME, a set of Korean companies have proactively made inroads to Indonesia, the world's fourth most populous nation with great growth potential, led by players such as POSCO and Hankook Tire.

POSCO set up a joint venture with Indonesia's state-run outfit Krakatau Steel in 2010 to invest $2.7 billion to establish its first overseas integrated steelworks in Cilegon, some 100 kilometers west of Jakarta.

The works are almost done with test runs currently underway for parts of its facility. POSCO is to start churning out iron late this year after an opening ceremony where President Yudhoyono is also expected to participate.

POSCO, which strives to make a preemptive move in Southeast Asian markets against China's foray, also has an option to channel an additional $3.3 billion to expand the capacity for a second-phase project.

During this summer, Hankook Tire opened its newest plant in Bekasi, 20 kilometers east of Jakarta, where the Seoul-based outfit will produce an annual capacity of 6 million cars and light truck tires.

Park arrived in Jakarta late Thursday after taking part in two international meetings on Indonesia's resort island of Bali and Brunei this week.

She plans to return home Sunday, the end of an eight-day overseas trip.