Johor can increase trade with Indonesia by capitalising on its economic growth

Johor can increase trade with Indonesia by capitalising on its economic growth

23 Oct 2020

Indonesia’s economy, which is projected to be more resilient and sustainable in the third quarter of this year, is expected to open up more avenues for Johor to further increase its trade with the republic, especially in the Riau Islands.

S. Ari Wardhana, Consul for Economic Affairs at the Indonesian Consulate General in Johor Bahru, said this was due to Johor’s strategic location in the Singapore-Johor-Riau Growth Triangle (SIJORI), of which the Riau Islands Province is also among the 15 Special Economic Zones in Indonesia.

He said SIJORI, which was established in 1993, has benefited the three partners through various economic activities.

Nevertheless, he believes the real trade potential that can be explored through the cooperation has not been fully utilised, thus giving the opportunity to Johor and Riau to further increase their respective economic value.

“In September this year alone, for example, the export value of Indonesia’s non-gas products to Malaysia was US$66.4 million (US$1 = RM4.15), enabling Malaysia to maintain its position among the top 10 Indonesian export partners.

“Of course, this is a good signal to the SIJORI cooperation, which is still ongoing between the three partners,” he said when met by reporters at his office here, today.

Ari said for Johor itself, the strategic cooperation through SIJORI has indirectly helped Johor receive investment in the manufacturing sector worth nearly RM8.5 billion for the 2013-2019 period.

“This value also makes Indonesia the second biggest country to invest in the manufacturing sector in Johor after the Netherlands.

“In this regard, among the sectors that can be further enhanced include manufacturing, tourism and services as their foundations have been laid by the two countries (Malaysia and Indonesia),” he said.

He said Johor and the Riau Islands are endowed with almost equal economic strength but these aspect should not be a reason for them to compete against each other, instead they should complement each other.

“To prevent the two countries from seeing each other as competitors, it is necessary to continue to improve existing communications by holding meetings, working visits or discussions involving various sectors.

“Besides that, the promotion of SIJORI cooperation also needs to be enhanced to continue to attract industry players in making large-scale investments that will indirectly benefit member countries, especially that of local residents,” he added.

This is in line with the aspiration of Johor Menteri Besar Datuk Ir Hasni Mohammad who wants the SIJORI cooperation to be reactivated to capitalise on its huge potential.

Source: Bernama