Seaweed and oil sectors; Phl, Indonesia strengthens trade ties

CEBU, Philippines -  The Philippines and Indonesia can further boost economic relations through developing their common potential in the seaweed and oil industries.

The two ASEAN countries recently signed a memorandum of understanding to expand their seaweed sectors.

Both nations have aimed to share good practices in seaweed farming and expand marketing practices, said First Secretary Erna Herlina of the Embassy of Indonesia at the sidelines of embassy’s business forum in Cebu yesterday.

This is one indication of the continued goal to expand trade relations and investment between the two nations amid the ASEAN economic integration, she told The FREEMAN.

The Philippines is known for vegetable oil production and is also deemed as the largest producer of carrageenan, a dry seaweed extract, around the globe followed by Indonesia and China. Indonesia is exporting raw seaweed.

“We’re also among the largest palm oil producer and we want to expand here,” Herlina said of the interest of Indonesian companies to build palm oil plants in the Philippines particularly in Mindanao.

She noted other potential and good quality plantation areas in the country like Cebu are also being considered.

“We need recommendations on what areas as we are going to communicate this to Indonesian companies also,” the official added.

Collaboration

Indonesian Ambassador to the Philippines Johny Lumintang said both countries have been exploring cooperation in other areas to forge enhanced economic relations.

He said his country has been looking at various economic sectors where business collaboration can further be established.

Herlina also stated other areas of interest to the Muslim-dominant nation include retail, franchising, mining and energy industries.

Both are also considering other industries -- shipbuilding, geothermal and renewable energy, steel, chocolate and cacao production, infrastructure, machinery and pharmaceuticals -- for cooperation.

Connectivity and more awareness from both sides, the secretary noted, are important to realize the bilateral agreements with the abundance of opportunities to explore.

Trade

Total trade between the two as of end-2013 reached US$ 3.5 billion. Philippine-Indonesia trade from January to July this year totaled US$2.1 billion, with the balance of trade in favor of Indonesia having a surplus of US$ 1.2 billion.

Its major exports to the Philippines include coal, coffee, copper, processed food, cars and chemical fertilizers. Its imports from the Philippines are banana, coconut crude oil, machinery, vegetable extracts, medical instruments, electronic goods, etc.

From January to September this year, Philippine investments in Indonesia totaled US$ 11.5 million.

The country's investments in the Muslim country decreased in the last three years. In 2010, ventures from the Philippines reached US$ 49.6 million, the highest investment value so far.  (FREEMAN)