Business

Indonesia-Zambia pact vital

PRESIDENT Edgar Lungu greets Dr Hassan Wirajuda, special envoy of the President of Indonesia at State House in Lusaka yesterday. PICTURE: EDDIE MWANALEZA/ STATE HOUSE

KALONDE NYATI, Lusaka
AS ZAMBIA aspires to transform its economy, looking to partnerships such as South-South Cooperation is cardinal.
This is because South-South cooperation offers exchange of resources, technology and knowledge among developing nations.
Zambia, like most other developing countries has, however, not fully exploited the initiative which consists of mainly some Asian, South American and African countries as demonstrated by the low trade volumes.
One such country, which Zambia has under-utilised is Indonesia.
“The trade volumes are uninspiring and sadly keep dropping,” head of chancellery and economic affairs at the Indonesian Embassy in Zimbabwe Hutomo Listyaghi said.
Despite Indonesia being rich in natural resources like gas, petroleum, gold, timber and rubber, and allowing Zambians to enter the country without a visa, Zambia has not exploited that market fully.
Statistics provided by the Indonesian Embassy in Zimbabwe, which also oversees Zambia, show that trade between Zambia and Indonesia has remained insufficient at less than US$10 million.
Of the total US$9.6 million recorded between the two countries last year, Zambia exported goods worth US$7.5 million while imports were at US$2.1 million from Indonesia, which is significantly low, considering the abundance of natural resources and products that the two countries offer.
Zambia exports cotton and tobacco while it imports paper, rubber and plastic components.
For instance, trade volumes dropped by half last year from US$18.5 million in 2016. In 2013, the total trade stood at US$17.4 million and later dropped to US$13.2 million in 2014 and US$11 million in 2015.
Mr Listyaghi attributes the low volumes of trade to lack of information on the opportunities offered by both countries and the information gap is largely due to lack of an embassy in Lusaka.
“Many traders, both Zambian and Indonesian, are unaware of the opportunities. Lack of an embassy has affected the promotion of relations between the two countries.
“It is important for both governments to work together in cementing ties, encouraging investors and traders to partner,” he said.
Despite the limited information trickling down on local entrepreneurs on business opportunities in Indonesia, a few Zambian entrepreneurs like Chipuma Maulu have entered that market.
Mr Maulu, who has been importing rattan garden furniture from that country since 2015, calls on other entrepreneurs to take advantage of that market.
“It is a new market which entrepreneurs need to exploit. The country has waived visas, which means that one can easily enter the market,” he said.
Both governments are aware that there are doing each other a de-service and it is against that background, that they have started working towards improving the ties.
Early this year, a special envoy of the President of Indonesia, Joko Widodo met President Edgar Lungu and discussed a wide range of bilateral issues.
Member of the Indonesian Presidential Advisory Council Hassan Wirajuda said President Widodo sent him to meet President Lungu with the aim of exploring and strengthening existing relations.
From the visit, it is clear that the spirit of promoting trade is mutual, and Dr Wirajuda feels Indonesia has the capacity to transfer technology given the fact that it is able to build its own planes, including fighter jets and sub-marines.
With his ambitious vision, President Lungu wants the government of Indonesia to invest in various infrastructure projects across Zambia.
This is evident from the massive and widespread infrastructure development that has not just beautified the country but also signifies the country’s economic development.
At the moment, Indonesian firm PT Industri Kereta Api (INKA) is negotiating a possible sale of 30 locomotives to Zambia worth US$90 million.
In addition, PT Wijaya Karya (WIKA) is also exploring construction projects in Zambia, including the possibility to join a mini hydro-power plant development.
Given the wealth and opportunities both countries have, it is imperative that they strengthen ties, which will accelerate South-South Cooperation and contribute to the meaningful development of emerging countries.



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