IORA Expected to Provide Opportunities for Economic Cooperation

Jakarta, IORA – The Indian Ocean Rim Association (IORA) member states are expected to open up opportunities for cooperation in various fields, particularly with Indonesia, such as in tourism, trade, and investment.

Head of Indonesian Investment Coordinating Board (BKPM) Thomas Lembong during the IORA Leaders’ Summit in Jakarta on Monday said that the most potential opportunity is to establish cooperation with the IORA member states, and not only focused on single cooperation. "Membership in IORA is varied. In general, we want to explore cooperation opportunities, be it in tourism, trade or investment," said the Trade Minister.

The Minister described that the IORA member states are varied. On one hand, Australia and Singapore are rich countries; on the other hand, there are developing and underdeveloped countries.

IORA consists of 21 member states, namely Australia, South Africa, Bangladesh, Comoros, India, Indonesia, Iran, Kenya, Madagascar, Malaysia, Mauritius, Mozambique, Oman, Seychelles, Singapore, Somalia, Sri Lanka, Tanzania, Thailand, the United Arab Emirates, and Yemen, as well as 7 dialogue partners, namely the US, the UK, Japan, Germany, Egypt, China, and France.

Amongst the 21 IORA member countries, four countries, namely South Africa, Australia, India, and Indonesia, and six dialogue partners, namely  the US, China, Germany, the UK, Japan and France are members of G20. "Investment depends on what country we are talking about, there is a big country, there is a small country. Investment is the key to opening access to other country’s market," said the Minister.

If talking about developing and underdeveloped countries, the Minister added, it is hard for us to ask them to invest in Indonesia. Conversely, it is an opportunity for Indonesia to invest abroad by utilizing our potential.

One of opportunities that could bring benefit for the underdeveloped, developing, and developed countries is tourism sector.

In 2015, the IORA intra-regional trade reached $777 billion, increased by 300 percent compared to that of 1994 which amounted to $233 billion.

In addition, the Indian Ocean represents 70 percent of the world trade lanes, including oil and gas distribution lanes. More than half of the container ships and two-thirds of the oil tankers from around the world passed through this region. IORA accounted for approximately 2.7 billion people or 35 percent of the world population. However, its role is only 12 percent of the world market share, 10 percent of global GDP, and 13 percent of foreign direct investment (FDI) destination.

In addition, 96 percent of intra-IORA trade is dominated by six countries namely Singapore, Malaysia, India, Indonesia, Australia, and South Africa. A number of countries that currently become an important concern for the Government of Indonesia in term of trade are Bangladesh, Kenya, Mozambique, South Africa, the United Arab Emirates, and Iran. (Ugi/MUR)

Source: Antara