Mon, 08/31/2009 11:55 AM  |  Special Report

SpecialReport: Indonesian merchants rule the market

The Jakarta Post

The kiosks at the Mercado Market tell the whole story: almost everything here, from toothpaste and household appliances, to clothing to seasoning commodities like turmeric, comes from Indonesia.

Shopping here feels much like in any market in a major urban area in Indonesia, with people speaking and shouting at each other in Indonesian. Indonesian traders mingle with locals, and the shared language makes business easier.

"Prospects are excellent," said a smiling Joko, a clothing supplier from Surakarta, Central Java, who comes to Timor Leste regularly.

On the streets, young people rev up their Japanese scooters imported from the country's closest neighbor; the countless cars and trucks clogging the streets is also indicative of a burgeoning middle class.

A decade after independence, Indonesia remains the most important business partner for the impoverished Timor Leste.

Imports from Indonesia keep growing every year. In 2008, Indonesian exports to its former colony reached US$110 million, a dramatic jump from $38 million in 2007, statistics The Jakarta Post obtained from the Indonesian Embassy there.

Next comes Singapore, with trade volume of $50 million last year, Australia with $40 million, followed by Vietnam and Malaysia with $30 million each, according to the statistics.

Indonesia supplies Timor Leste with basic goods, fuel, cars and parts, electronics and furniture. And the former colonial master is doing everything to keep its exports competitive.

"We'll keep expanding bilateral trade relations every year," says Indonesian Ambassador to Timor Leste Eddy Setiabudhi.

Opportunities to do business remain wide open for Indonesian investors, as Timor Leste gears up for infrastructure development to woo direct foreign investment and create jobs.

Faustino Cardoso Gomes, director of Timor Leste National University's research center, says the Xanana Gusmao administration has prioritized trade with Indonesia over that with other countries like Singapore and Australia, or even former colonial power Portugal, because the country relies heavily on Indonesia for the bulk of its basic commodities.

To support efforts to boost bilateral relations, Indonesia has established an Indonesian Cultural Center, aimed at promoting Indonesian culture in Timor Leste for better understanding between the two peoples.

Although the institution is already there, the embassy is still seeking to acquire a building to accommodate activities such as performances and Indonesian language courses.

Students of the St. Joseph high school in Dili, who learned to play the angklung (bamboo percussion instruments) at the cultural center, recently performed during the Indonesian Independence Day celebration at the Indonesian Embassy, along with angklung artists from Mang Ujo Studio in Bandung.

Still nursing the wounds from decades of conflict, the two countries have joined forces in security and defense, with Indonesia providing training for the Timor Leste police force, while Timor Leste military chief Gen. Taur Matan Ruak has invited his Indonesian counterpart to visit Dili this September.

The trip will be the first by Indonesia's top brass to Timor Leste to forge cooperation over the past decade.

The bilateral cooperation has to date focused mainly on joint border security, which also involves the UN police, customs and excise, as well as immigration authorities from the two countries.

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