INDONESIA – VISEGRAD COUNTRIES ECONOMIC COOPERATION

Writer: Hendra Manurung (Hendra Manurung is currently pursuing a doctoral degree in international relations at Padjadjaran University, Bandung)

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Indonesia attempted to boost the potential for cooperation with four Visegrad countries on 8 October 2019. The Visegrád group which is called the Visegrád Four or V4 is a sub-regional organization of Central Europe which consists of four countries, namely Czech, Hungary, Poland, and Slovakia.

The Visegrad countries group cooperation began on 15 February 1991. The V4 group is substantially formed to further strengthen economic and political integration within the European Union.

Vice Indonesia Foreign Minister, Fachir stated at the 2019 Indonesia-Visegrad Group Business Forum in Serpong, 17 October 2019, in the sidelines of the 2019 Trade Expo Indonesia: “Strong relationship among the Indonesian and V4 business actors will affirm Indonesia’s existence in the region that is deemed strategic as a trading hub that connects West Europe, Central Europe, and East Europe.” (https://kemlu.go.id/).

Business forum activities are one of the priority programs of President Joko Widodo’s vision to further strengthen economic diplomacy.

The economic interaction between Indonesia and the Visegrád region so far is still very limited, even though with an average economic growth of above 4 percent, the countries in this region have great potential for cooperation.

The prospect of cooperation with Visegrád countries is considered to be more promising with their rapid economic growth at an average of 4.1 percent, far above the average economic growth of the European Union (EU) which is approximately 2 percent.

The combined economic size of the V4 countries is equivalent to that of the 5th largest economy in Europe, and through the Visegrád Group, these four countries have an increasingly prominent bargaining position within the EU.

The magnitude of the economic potential of Central Europe has not been fully explored by Indonesia. For this reason, the Indonesia-Visegrád Business Forum will be an excellent opportunity for Indonesia to learn about and take advantage of opportunities for economic cooperation in the four countries, as well as to find solutions to some of the challenges it faces.

However, both sides keep optimistic and positively regarding the value of exports and imports between Indonesia and the V4 countries that accumulatively kept increasing during the last five years (2014-2019), with bilateral trade volume reaching US$ 1 billion in 2018.

 

In mid of October 2019, the business forum held and attended by 55 Indonesian companies and 48 companies from Visegrad countries which emphasize several elements that could be synergized continuously, namely technological advances, labor, and market size.

The business forum activities were then filled with business matching events between Indonesian entrepreneurs and V4 countries, most of who are engaged in food, apparel,  assembly, information technology, pharmaceuticals, human resources, energy, and infrastructure.

It can be done through increasing Indonesian manufactured products export. The volume of trade that has been achieved between Indonesia and the four Visegrád countries is equal to US$ 1 billion US dollars in 2018 (Antaranews.com, 8/10/2020).

Suppose Indonesian entrepreneurs and V4 countries’ strong partnership will further strengthen Indonesia’s foothold in the European region. Visegrad is considered strategic as a trade center hub connecting Western Europe, Central Europe, and Eastern Europe.

The Indonesian government also encourages the labor and technology services sector to be developed in economic cooperation with Visegrad countries.

This relation also aims to enhance cooperation in the sector indicated by the signing of six memorandums of understanding (MoU) by the Indonesian company and its partners from Visegrad, for the provision of professional and skilled labor on the sidelines of the Business Forum Indonesia-Visegrad in 2019.

Increased sector cooperation was represented by the signing of six memorandums of understanding (MoU) by Indonesian companies and their partners from Visegrad, to provide a professional and skilled workforce.

At the signing of the MoU, everything was about human resources related to work services due to Visegrad countries necessary.

As a group whose economy is driven by the industrial sector, including the automotive and shipbuilding, the four Visegrad countries, especially Hungary and Poland which had been employing workers from Indonesia.

The number of Indonesian workers, so far, is still small, only reaching hundreds of people. However, Indonesian workers are considered to have advantages over a number of workers who come from other ASEAN countries.

In general, Indonesian workers are considered to have a good character who is more loyal and professional, and a number of companies that employ them in Poland and Hungary are more comfortable with the presence of Indonesian workers in their countries.

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