Indonesia has experienced rapid economic growth since becoming a democracy. It is currently the world’s sixteenth largest economy and projected to be the seventh largest by 2030. Indonesia is a priority relationship for New Zealand. It has a population nearing 250 million with a growing consumer class, making it a key market for New Zealand exports. Indonesia is the world's largest archipelago with approximately 18,000 islands spanning the equator and is an important partner for New Zealand in the Asia-Pacific region.

BILATERAL TRADE: NZ-INDONESIA

Indonesian and New Zealand markets are complementary and largely non-competitive. The agreement establishing the ASEAN, Australia and New Zealand Free Trade Area (AANZFTA) was signed by New Zealand, Australian and ASEAN Trade Ministers on 27 February 2009. Indonesia completed its ratification process in late 2011 and the agreement entered into force for them on 10 January 2012.

New Zealand is one of Indonesia's leading suppliers of dairy products as well as an important market for New Zealand beef and forestry products. Indonesia's import licensing regulations on animal (including beef) and horticultural products have been an impediment to the growth of our beef trade. Approximately 90% of New Zealand's exports to Indonesia are primary products (principally dairy products - about 43% - meat, wood pulp and other wood products).

AANZFTA represents a significant milestone in New Zealand’s engagement and on-going integration into one of the world’s most economically dynamic regions, and, provides an important foundation for the strengthening of our bilateral trade relationships within ASEAN. By 2020, New Zealand exporters will receive tariff-free treatment in Indonesia on more than 99 per cent of tariff items, compared with only 11 per cent before the agreement entered into force. New Zealand and Indonesia also reached agreement on a bilateral cooperation package, including in areas such as agriculture, labour and environment cooperation.

New Zealand’s bilateral aid programme with Indonesia is its largest outside the Pacific.


TRADE STATISTICS

Ranking: NZ’s 11th largest trading partner
NZ Exports: NZ$886 million (FOB)
Main exports: Dairy ($432m); Meat and bone meals, animal feed and other ($110m); wood products ($116m)
NZ Imports: NZ$805 million (CIF)
Main imports: Mineral fuels ($172m) Animal feed and other ($166m); Electric machinery ($69m)