New Zealand Embassy Jakarta, Indonesia

From the Ambassador's Blog: Doing Business with Indonesia: How the Embassy can help

The joint MFAT and NZTE Team at the New Zealand Embassy in Jakarta

Discussions with New Zealand companies in recent weeks has highlighted the value in breaking down how the New Zealand Embassy can support business. This blog is an attempt to set out simply and clearly what the team here can do to help.

The key agencies so far as New Zealand companies are concerned are the Ministry of Foreign Affairs (MFAT) and Trade and New Zealand Trade and Enterprise (NZTE). We work closely together and are co-located in the New Zealand Embassy in Jakarta.

Market Intelligence / Market Entry

The NZTE Jakarta team now consists of a full-time Trade Commissioner, 3 specialist Business Development Managers and other support staff. The Trade Commissioner and BDM’s have deep market knowledge of business in Indonesia with particular expertise in Food & Beverage, Aviation, Geothermal, Professional Services, Specialist Manufacturing and ICT.

NZTE can assist companies from initial market investigation through to establishing market presence. Starting with generic market information NZTE will then develop, working closely with the relevant NZ NZTE offices, specific engagement plans with companies setting out the support that NZTE will provide as companies implement their Indonesian strategy.

Market Access

The MFAT team works to facilitate access to the Indonesian market – we negotiate the rules that apply to trade between our countries and monitor the implementation of those rules.

The Asean Australia New Zealand Free Trade Agreement (AANZFTA) is a comprehensive free trade agreement covering goods, services and investment. This entered into force for Indonesia in January 2012 and governs trade between the two countries (as well as across Asean and Australia too).

MFAT officials manage the implementation of the agreement with Indonesian counterparts. See the website www.aanzfta.govt.nz for more information and for a tariff calculator that identifies current and future tariffs for trade in goods.

MFAT is also leading negotiations for New Zealand on a new Regional Comprehensive Economic Partnership (RCEP) which will link ASEAN and their six free trade partners (Australia/New Zealand, China, Japan, Korea and India) in a new agreement covering goods services and investment. The aim is to conclude the negotiation by the end of 2015, when the ASEAN Economic Community comes into force. This agreement is to have an open accession clause that will allow other countries to join over time.

Product Access

Processed products that are consumed, including medicines and drinks, are governed in Indonesia by its food safety agency, known by the acronym BPOM. Every product entering the market needs to obtain a product registration or “ML” number from BPOM. The process takes a minimum of three months if the paperwork has been completed correctly. NZTE helps companies on their client list with their applications. MFAT maintains regular contact with BPOM and can help deal with any problems that arise around product access or food safety.

Customs Issues

MFAT works to resolve any problems that arise at the borders with the importation of New Zealand products. In the past year, for example, we worked to secure the release of beef detained in port and to assist with some dairy issues.

Export Credit

Outside the Embassy, the New Zealand Export Credit Office provides a range of credit insurance and financial guarantees for exporters and their banks to assist mitigate repayment risk, performance risk and win trade sales. For example, they can assist exporters to:

  • mitigate the effects of a buyer cancelling a contract or defaulting on payments, as a result of commercial or political events beyond an exporter’s control; and
  • secure contracts, by enabling the exporter to offer both short and extended repayment terms; and
  • access bonding and funding lines from their banks to execute export contracts.

The New Zealand Export Credit Office provides this support, separate from the work of NZTE and MFAT. Visit www.nzeco.govt.nz for further information.

Relationship Support

Both NZTE and MFAT provide relationship support.

Through the Ambassador, MFAT can support companies working at senior level with Indonesian counterparts, either in terms of sales of goods, services or engagement around investment. While top-level engagement can help open doors, the reality is that much of the detailed work is done at lower level, especially in large corporates so it’s important to engage both at senior level and with relevant other decision-makers.

NZTE can support engagement at the practical level with Indonesian companies. They can also provide support through their Beachheads programme with companies seeking to enter the market for the first time. And they can help provide advice on how to go about selecting an agent or local representative.

MFAT provides support in relation to problems that arise around goods trade, as described above.

Official engagement

We have a number of processes that provide for regular engagement relevant to our trade interests. These are mainly MFAT-led processes. They include:

Foreign Minister Consultations (annual). Led by foreign ministers and take stock of all aspects of the bilateral relationship. Last held 9 October 2012 2012

Trade and Investment Framework (TIF) talks held approximately every 18 months. Focus on trade and investment relations and issues. Last held in March 2012.

Education Joint Working Group. Annual discussions on education relations and policy. Led by Ministry of Education. First talks held in February 2012.

Agriculture Joint Working Group. Annual discussions on cooperation in the agricultural sector, including New Zealand’s capacity building efforts, and on agricultural trade issues of concern. First talks held in November 2012.

Environment Cooperation Committee. Regular discussions on how best to cooperate with Indonesia in the environmental space. First talks held in May 2012.

Labour Joint Working Group. Regular officials’ discussions on Labour cooperation and labour issues of mutual concern. No talks held yet.

While some of the above are not strictly about trade per se, they offer an opportunity to raise issues of sectoral interest and should be considered by business with relevant interests as a vehicle to raise opportunities or concerns through government partners.

We also have regular Ministerial and senior official contacts across a broad front which provide opportunities to raise topics of interest with Indonesia.

And we have growing private sector interest in developing stronger links with Indonesia. The Prime Minister brought a large senior delegation with him to Indonesia last April, the ASEAN New Zealand Combined Business Council hosted a major Indonesia forum last September and is organising a mission to Indonesia in May, we’ve had delegations from all of our universities, the tourism sector and a growing number of business missions through here as well. We provide appropriate support for these visits and welcome contact with interests, large or small, around their visits and engagement here. By we I mean both NZTE and MFAT.

Conclusion

I hope this brief survey helps make the roles of agencies at the post more readily understood by New Zealand business. If in doubt, ask!

To our Indonesian friends, the Indonesian Embassy in Wellington is the best first point of contact if you want to engage. We’ve encouraged the Indonesian government to open a trade office in New Zealand to provide more support to promote Indonesian business, but that hasn’t happened yet.

My view remains that whether we’re talking New Zealand trade into Indonesia or Indonesian business into New Zealand, the benefits accrue to both countries through deeper engagement, the creation of employment and wealth generation. The New Zealand team here works hard in support of that two-way process and looks forward to continuing to support and serve businesses.

Of interest

United Nations Handbook 2014-15

United Nations Handbook
2014-15

The UN Handbook is a comprehensive guide to the UN system and how it works.  Read more

Prime Minister's media release | www.beehive.govt.nz

New Zealand wins Security Council seat

New Zealand has secured a place on the UN Security Council for 2015-16. Read the Prime Minister's media release

Registering your overseas travel made easier

Registering your overseas travel made easier

New Zealanders travelling or living overseas, registering your travel online now made easier. Read more

Ambassador's blog

Ambassador's blog

Read the latest posts from David Taylor, New Zealand's Ambassador to Indonesia and to ASEAN. Read more

www.mfat.govt.nz | NZ Inc ASEAN strategy

NZ Inc ASEAN strategy

This regional Strategy outlines how New Zealand and ASEAN will become better connected. Read more

New Zealand ASEAN Scholar Awards

New Zealand ASEAN Scholar Awards

Open to eligible candidates from the public, private and civil society sectors. Read more

The Christchurch Earthquake Appeal

News about how the donations are contributing to the rebuild, ways to donate and more.