www.-economy.by FOREIGN ECONOMIC ties FOREIGN ECONOMIC ties

No. 2, 2014 2, No. ’ Interests: Indonesia

Indonesia, the biggest country in Southeast Asia, is largely focused on cooperation with its closest neighbors and

ECONOMY OF BELARUS OF BELARUS ECONOMY ASEAN partners. Nevertheless, Belarus-Indonesia trade that skyrocketed from $1.8 million in 1995 to $130 million in 2013 demonstrates that and Jakarta have managed to find common areas of interest. What are the niches of the Indonesian economy where Belarusian companies have managed to consolidate their positions? What reputation do Belarusian scientists have in Southeast Asia? These questions were addressed by the Magazine to Ambassador Extraordinary and Plenipotentiary of Belarus to Indonesia Vladimir Lopato-Zagorsky who also represents Belarus’ interests in Malaysia, , Singapore and the Philippines:

62 FOREIGN ECONOMIC ties www.belarus-economy.by

It might seem that there are I have mentioned just one buyer In Q1 2014 alone, Belarus exported no preconditions for any signifi- of Belarusian fertilizers. tires worth $2.5 million to Indone- cant increase in Belarus-Indonesia However, Belarusian Potash Com- sia, which amounted to 94% of the trade because of the great distance pany and the Embassy are in talks total supplies in 2013. between the two countries and Indo- with other Indonesian companies, Given the declining demand 2014 2, No. nesia’s well-established trade and too. for heavy-duty tires caused by the economic ties with other Southeast downturn in the industry of Asian countries, and with , Intensive development of Indonesia, Belarus has been diversi- Japan, South Korea and the United and mining generate fying the supplies with trucks and States. However, in reality the situ- demand for machinery and equip- passenger cars tires. ation is absolutely different. The ment. Does Indonesia import We believe that there are also economies of Belarus and Indonesia Belarusian machines? good prospects for promotion of are complementary. Vigorous trade products made by MAZ, Amkodor, in certain commodities benefits The company PT Belarus Trac- Scientific and Production Associa- both Belarus and Indonesia. tor Indonesia was registered by PT tion “Center”, Minsk Bearing Plant The rapidly growing popula- Kobexindo in March 2013 and other Belarusian enterprises. tion prompts the Indonesian gov- with a view to promoting MTZ trac- ernment to give a greater focus to tors on the Indonesian market. In You mentioned that the agriculture and production of food- January 2014, the first batch of six demand for food has been grow- stuffs. As agricultural land is rather Belarus-892.2 tractors was delivered ing in Indonesia, where popula- OF BELARUS ECONOMY scarce in Indonesia, the country has to PT Belarus Indonesia. In tion has exceeded 250 million. no other option but to increase the line with the memorandum signed What can Belarusian manufac- crop yield on the available land. The by MTZ and PT Belarus Tractor turers offer here? government has announced plans Indonesia, 250 tractors are to be to channel $1.72 billion to subsidize shipped to Indonesia in 2014-2015. Now work is under way to start the purchase of fertilizers for farm- The sale of BelAZ dump trucks supplying food products to Indone- ers in 2014. in Indonesia is another promising sia. For example, we are negotiating Naturally, Jakarta completely cooperation avenue. Potential buy- a contract with a large Indonesian understands our efforts to promote ers include companies involved in company Indofood on the supply potash fertilizers on the Indonesian mining and cement production, as of milk powder. The export of this market. They also know that potash well as big engineering companies product in the current year can fertilizers are Belarus’ major export running large-scale infrastructure reach 8,000 tonnes. commodity to Indonesia. Indonesia projects (construction of roads, In January 2014, the Ulama reduced the overall import of pot- electric power plants, etc.). Council of Indonesia issued halal ash fertilizers by 33.8% in 2013, as With a view to securing a foot- certificates for six Belarusian the country purchased too much hold on the ASEAN markets (includ- plants, which is the requirement for of this commodity in the previous ing Indonesia), BelAZ registered the the export of dairy products to that years. Nevertheless, in 2013 the sup- trading house Belazia in Singapore country. plies of Belarusian potash fertiliz- in December 2011. Belarus, in turn, welcomes ers rose 1.2 times compared to 2012 I would like to note that Indo- direct delivery of traditional Indo- (from $70.3 million or 169,600 tonnes nesia reduced the import of dump nesian goods such as natural rub- to $86.7 million or 255,100 tonnes). trucks by 25.7% in 2012 and by 88.4% ber, seafood, palm oil, coffee, spices, In the first quarter of 2014, the in 2013. It was due to the production tobacco, and others. export of Belarusian potash fertiliz- decline in the mining industry, in ers to Indonesia already rose more particular, crisis in coal production Are Indonesian businessmen than 1.3 times compared to the same as a result of the falling prices for interested in investing in Bela- period in 2013. coal on the global market. Neverthe- rus? In February 2014 Belarusian less BelAZ shipped nine 45-tonne Potash Company won the tender dump trucks to Indonesia over these Given the volatility of the global to supply 250,000 tonnes of potash two years. BelAZ has plans to sign a economy Indonesia’s overseas fertilizers for Indonesia’s biggest contract to supply eight more dump are insignificant and producer of compound fertilizers trucks to this country in the near limited mostly to the nearby coun- PT Petrokimia Gresik. Due to this, future. tries, particularly Southeast Asia the export of Belarusian potash The advanced mining industry states. In addition, the Indonesian fertilizers to Indonesia in H1 2014 coupled with major infrastructure government is actively encouraging alone will be nearly as big as in the projects in Indonesia open up big domestic companies to invest in the entire 2013. The agreements reached prospects for the Belshina tire pro- national economy. All this makes it during the visit of PT Petrokimia ducer in that country. difficult to attract large-scale Indo- Gresik President Director Hidayat In 2007 Belshina opened the Bel- nesian to Belarus. Nyakman to Minsk suggest that tyre Asia trading house in Singa- Nevertheless, we constantly Belarus can count on the construc- pore, which handles, among other work with potential investors and tive cooperation with this company things, the supplies of Belshina at all meetings inform them about in the future. products to the Indonesian market. the advantages of investing in the 63 www.belarus-economy.by FOREIGN ECONOMIC ties

Republic of Belarus, stressing that we are a member state of the Cus- toms Union and the Single Eco- nomic Space of Belarus, Kazakh- No. 2, 2014 2, No. stan and . Some Indonesian companies are interested in the Belarusian economy, especially agriculture and the pharmaceutical industry. These avenues are already being explored. The Indonesian pharmaceutical giant PT Sanbe Farma said that for making the final decision on the investment in the Belarusian pharmaceutical industry the deci- sive factor will be the absence of the requirement to undergo additional registration for the products which will be made in Belarus in the other

ECONOMY OF BELARUS OF BELARUS ECONOMY members of the Customs Union. Whether we manage to attract Indonesian investment into this sec- tor of the Belarusian economy will largely depend on the progress the Customs Union and the Single Eco- nomic Space will make in unifying the pharmaceutical market of Bela- cooperation with Belarus in erate with Belarusian scientists. rus, Russia and . science and technology. When Our major goal is to translate these might the parties embark on joint plans into practice. Are Belarus and Indonesia projects? In 2014 the Australian National planning to develop cooperation University and the National Acad- in the field of healthcare? Belarus and Indonesia are emy of Sciences of Belarus are actively developing contacts in sci- expected to sign the Agreement on Healthcare is a promising area ence and technology. In 2011 sci- Scientific Cooperation and Collab- of Belarusian-Indonesian coopera- tech cooperation was not even on oration in the Field of Scientific tion. At my meeting with the Indo- the bilateral agenda. However, well- Personnel Training. Together with nesian Health Minister Dr Nafsiah coordinated efforts of the State the Singaporean companies we are Mboi in October last year we dis- Committee on Science and Tech- studying the ways of commercializ- cussed the training of Indonesian nology of Belarus, the National ing Belarusian innovative solutions healthcare personnel in Belarus, Academy of Sciences and the in the production of solar cells, exchange of expertise, the supply Embassy have allowed us to reach porous filters and heat-resistant fib- of medical equipment. a new level of cooperation in a ers. Following the talks, the Belaru- very short period of time. Over the sian Healthcare Minister extended past two years we have concluded Belarus has been actively an invitation to Dr Nafsiah Mboi to three fundamental agreements in expanding its education exports visit our country. We hope that the the sci-tech sector, secured a regu- today. Are there chances for Bela- visit could be arranged this year or lar exchange of visits among the rusian educational services to be in early 2015, and the Indonesian heads of the key research estab- in demand in Indonesia? side will be able to familiarize them- lishments of the two countries. In selves with the achievements of the December 2013 Belarus and Indo- Indonesia is a country where Belarusian healthcare system. nesia signed a joint program on Belarus can fulfill its considerable I will add that Belarusian pro- sci-tech cooperation, which envis- education potential. Local students ducers of medical equipment ages the implementation of three are interested in getting education Medindustria Service and the projects in mechatronics, powder abroad. Every year about 30,000 Unitechprom of the Belarusian metallurgy and physics in 2014- Indonesian students go overseas to State University have established 2016. The two countries are also get a foreign diploma. Indonesians contacts with partners in Indonesia. mulling over projects in biotech- traditionally go to study to nearby As a result, Belarusian medical fur- nologies. countries (Australia, Singapore, niture and equipment are already I would like to note that not only Malaysia, China, Japan), Euro- used in Indonesian hospitals. Indonesia but also other countries pean countries (the , where I am accredited acknowledge , , Switzerland, the UK) Indonesia has repeatedly the high level of the Belarusian sci- and America (the and stressed its willingness to develop ence and express readiness to coop- ). 64 FOREIGN ECONOMIC ties www.belarus-economy.by No. 2, 2014 2, No. In the first quarter of 2014, the export of Belarusian potash fertilizers to Indonesia rose more than MTZ will ship

1.3 250 times compared to the Belarus-892.2 tractors to Indonesia same period in 2013 in 2014-2015 ECONOMY OF BELARUS OF BELARUS ECONOMY

Belarus has not yet made it to Indonesia is mostly interested in Is Indonesia attractive for the list of the countries that host such areas as mechanical engineer- Belarusian tourists and is it dif- Indonesian students. However, we ing (mining equipment, machinery ficult to get the Indonesian visa? have a good basis for building up assembly and maintenance, etc.), cooperation in the academic sector. information technologies, natural According to the Minis- During the meeting with the sciences (physics, chemistry), math- try of Indonesia, only 800 Belarusian in Jakarta in ematics, and medicine. tourists visited Indonesia in 2013. March 2013 the Indonesian head of With the plans to build its own And the reason for that is not only a state stressed his interest in sending railway afoot, East Kalimantan is long distance. The fact that Belaru- Indonesian students to Belarusian considering the possibility of send- sian nationals have to get Indonesian universities to study engineering ing its students to the Belarusian visas at the Indonesian Embassy in and technical disciplines. Indone- State Transport University. Moscow is a challenge for advancing sia’s demand for these specialists Summing up what was said we cooperation in tourism. has recently increased due to the can infer that Indonesia is keen We are interested in a bigger country’s infrastructure develop- to develop cooperation in the edu- number of mutual visits by holiday ment plans. cation sector at the national and makers as well as business travel- In order to develop the legal regional levels as well as at the ers. First of all, the Belarusian framework for cooperation in the level of big state-run companies. diplomatic mission aims to create education sector we are working on Of course, we are still at the begin- conditions to facilitate the proce- two draft agreements: an intergov- ning of this journey but we hope dure of getting Indonesian visas by ernmental agreement on coopera- that in the near future Belarus will Belarusian citizens. In 2012 we filed tion in education and an intermin- join the list of destination countries an application regarding the inclu- isterial agreement on engineering Indonesia sends its students to on a sion of Belarus in the official list of training of Indonesian citizens in regular basis. countries with their citizens eligi- the institutions of higher education In my view, it is also important ble to apply for the visa upon arrival of the Republic of Belarus. The Edu- to develop direct contacts between in Indonesia. If the requisite deci- cation Ministry of Belarus is con- universities. Today the University sion is made, the Belarusian nation- sidering the possibility of paying of Indonesia (the country’s big- als will be able to receive visas upon scholarships to Indonesian students. gest educational establishment) is arrival at the Indonesian airport. We can also boost education ties building up contacts with the Minsk By the way, Indonesia applies the at the regional level. In 2013-2014 we State Linguistic University. Indone- Visa-on-Arrival regime in relation discussed the matter with the gover- sia’s largest agricultural university to more than 60 countries, includ- nors of the Indonesian provinces of Bogor Agricultural Institute has ing Russia. Therefore, we hope that East Kalimantan, South Sumatra, been working to bolster ties with the Belarus will soon be among these East Java and with the governor Belarusian State Agricultural Acad- states. Belarus’ application is cur- of Jakarta and received a positive emy. The universities are busy devel- rently being considered by the Indo- feedback. oping agreements on cooperation. nesian agencies. 65 www.belarus-economy.by FOREIGN ECONOMIC ties No. 2, 2014 2, No. ECONOMY OF BELARUS OF BELARUS ECONOMY

We are also trying to ease the The decision to open the Bela- created the necessary framework entry to other countries of the rusian Embassy in Indonesia and gained support for the fulfill- region. For example, in 2012 Bela- was made with the understand- ment of foreign economic priori- rus filed an application concerning ing that this diplomatic mission ties. the visa free entry to the Republic shall become the so-called hub for The Commonwealth of Aus- of Philippines for Belarusian tour- the promotion of our interests in tralia is the largest economy of ists and businessmen for the period Southeast Asia. the region. It is a good investment of up to 21 days. We are also dis- Australia, Malaysia, Singapore source and a promising market for cussing draft agreements on mutual and the Philippines are among the Belarus-made tires and earth-mov- visa-free regime with Malaysia and leading regional and global econo- ing equipment. At the beginning Singapore. mies with the aggregate GDP of of 2014 the Belarusian government By the way, can visit about $2.4 trillion and the popula- decided to open a diplomatic mis- Malaysia visa-free given the period tion of over 160 million. sion in Australia. of their stay does not exceed 30 days. In March 2013 the Belarusian Malaysia and the Philippines Apart from that, the introduction President made a productive visit to are big consumers of Belarusian of the so-called electronic visa has Singapore. We are now working on potash fertilizers. Belarusian Pot- facilitated the entry to Australia. It the exchange of visits of the foreign ash Company with the assistance is no longer necessary to go to the service heads with Australia, the of the Embassy successfully coop- Australian Embassy in Moscow for Philippines and Malaysia. erates with the partners particu- the visa. The inter-parliamentary ties larly in Malaysia. In Q1 2014 Bela- I hope that in the future our have been increasingly vibrant. rus exported over 200,000 tonnes of citizens will be able to travel to The visit of the Speaker of the to Malaysia whereas in this region more freely to enjoy its Parliament of Singapore, friend- the whole 2013 Belarus’ export was exotic beauty in full. ship groups with the parliaments only 185,000 tonnes. We help our of Malaysia, Singapore, the Phil- exporters to organize the sales of Mr Lopato-Zagorsky, can you ippines and the ASEAN Inter-Par- Belarusian tractors, buses and tires briefly evaluate Belarus’ coop- liamentary Assembly established to these two countries. eration with Malaysia, the Com- at the National Assembly of the The market of Singapore is monwealth of Australia, the Republic of Belarus have advanced smaller due to the country size. Republic of Singapore and the cooperation between legislative Therefore, we are focused on the Republic of Philippines? authorities. We can say that we have development of high-tech and 66 FOREIGN ECONOMIC ties www.belarus-economy.by No. 2, 2014 2, No. ECONOMY OF BELARUS OF BELARUS ECONOMY

The mining industry is the core of the Indonesian economy. It generates more than 11% of the country’s GDP. Indonesia is the largest exporter of coal in the world. In 2013 the production of coal in Indonesia made up 400 million tonnes. It can be compared to the extraction of all ores in the Russian Federation which is now the main export market for BelAZ

investment cooperation with this state. We also use Singapore as a gateway for Belarusian goods to the markets of other Southeast Asian countries. We are currently mulling over the possibility of opening a joint assembly facility of BelAZ trucks in Singapore. Belarusian and Singapo- rean companies explore possibili- ties for cooperation in food produc- tion. We try to attact Singaporean companies to the implementation of infrastructure projects in Minsk.

Marta ASTREIKO 67