Análisis comparativo de las relaciones comerciales Argentina-Indonesia y Chile-Indonesia: Sus similitudes y diferencias. ¿Qué puedes aprender del vecino?
| Autor | Sebastian Sterzer/Andi Killang Pakkanna |
| Cargo | National University of Lujan/Perusahaan Perniagaan Internasional |
| Páginas | 87-120 |
Latin American Journal of Trade Policy 8 (2020) – ISSN 079-9668 – Universidad de Chile
87
Comparative Analysis of the Trade Relations of Argentina-
Indonesia and Chile-Indonesia: Their Similarities and
Differences. What Can You Learn from the Neighboring
Country?
Sebastian Sterzer*
Andi Killang Pakkanna**
Abstract
Chile and Argentina have put their radars on trade with Southeast Asian countries, in which Indonesia
appears as one of the main countries. In recent years, Chile has had a more aggressive trade policy
towards Indonesia. The most recent proof has been the signing of the Indonesia - Chile
Comprehensive Economic Partnership Agreement (IC-CEPA), which entered into force in 2019.
The objective of this article is to present a comparative analysis of trade flows between Argentina -
Indonesia and Chile - Indonesia, looking for similarities and differences between both types of
bilateral ties, so that they can serve as models to improve existing relations, learning from what it has
happened in each one of them.
Keywords: Argentina, Chile, Indonesia, Export, Import.
Resumen
Chile y Argentina han puesto sus radares en el comercio con países del Sudeste Asiático, en el cual
Indonesia aparece como uno los países principales. En los últimos años, Chile ha tenido una política
comercial más agresiva hacia Indonesia. La prueba más reciente, ha sido la firma del Indonesia - Chile
Comprehensive Economic Partnership Agreement (IC-CEPA), el cual entró en vigor en 2019. El objetico de
este artículo es presentar un análisis comparativo de los flujos comerciales entre Argentina-Indonesia
y Chile-Indonesia, buscando las similitudes y diferencias entre ambos tipos de vínculos bilaterales,
para que puedan servir como modelos para mejorar las relaciones existentes, aprendiendo de lo que
ha acontecido en cada uno de ellos.
Palabras Claves: Argentina, Chile, Indonesia, Exportaciones, Importaciones.
* Head of the International Relations area for the Observatory of International Trade at the National University
of Lujan, Buenos Aires, Argentina. Email address: sterzersebastian@gmail.com. Received: O ctober 17th, 2020;
modifications: December 1st, 2020; accepted: December 20th, 2020.
** President d irector, at PT. Perusahaan Perniagaan Internasional (PPI). Partner at Lembaga Komunikasi
Percepatan Ekspor Nasional (LK-PEN). Email address: akp.andikillang@gmail.com .
Sebastian Sterzer - Andi Killang Pakkanna
Comparative Analysis of the Trade Relations of Argentina-Indonesia and Chile- Indonesia: Their Similarities
and Differences. What Can You Learn from the Neighboring Country?
88
Introduction
International trade as a generator of foreign exchange revenues due to exports that a country makes
to third ones, is a key factor for each State to develop a trade policy according to its needs. These
may include not only the strengthening of the private sector for fundraising reasons, but also to create
more jobs. In the context of uncertainty experienced in recent years, aggravated by the COVID-19
pandemic, it has become vital to build a strongly competitive export s ector, channeling exports not
only to traditional markets (for example, in Latin America, the United States, the European Union,
China, among others), but also to explore non-traditional markets.
In this sense, both Chile and Argentina have had trade policies aimed at consolidating their positions
in existing markets, as well as promote their export supply in new markets. Both countries have had
different business strategies to address these issues, which will be mentioned later in this article.
Although it is true that Latin American countries have had a historical tendency to export primary
products (CEPAL, 2018), there is a growing need to intensify the supply of goods and services with
greater added value, more qualified labor, and more sophisticated technology.
Among these non-traditional markets, Indonesia appears as an interesting one, as being the largest
economy in the Southeast Asian region, with a population that exceeds 270 million inhabitants. In
addition, the Southeast Asian region per se presents greater economic and commercial dynamism in
relation to other regions of the world, for which deepening bilateral and regional ties have become
imperative. Of course, from the counterpart, there are also intentions to explore business
opportunities, on the other side of the world, with non-traditional markets. For Indonesia, the
importance of exports has become strategically relevant to detect new markets - in addition to the
deepening of existing ones - to increase foreign exchange earnings, the level of labor, among other
factors. Among these new markets, those in Latin America - characterized as non-traditional -
currently occupy a prominent place on the Indonesian government’s foreign trade policy agenda.
In this sense, the signing of the Indonesia - Chile Comprehensive Economic Partnership Agreement
(IC-CEPA) and its entry into force (2019) is just one of the examples that best helps to understand
this agenda. However, as Zulfikar (2019) mentions, care must be taken when opening an external
market, especially if the political environment -among other factors- is unstable, or uncertainty
predominates. In other words, a careful analysis of the political environment must precede a
commitment to a new market abroad. In any case, this article focuses on the issue of exports from
Argentina and Chile to Indonesia, comparing what happened in the last 5 years (considering ITC
Trade Map data statistics which cover the 2015-2019 period) in both Latin American countries. This
analysis is carried out to understand what are the similarities and differences in both behaviors and,
also, glimpse in what way foreign trade with the Asian country could be boosted if Chile-Argentina-
Indonesia trade were jointly articulated, thinking that the IC-CEPA could be an injection of greater
exports from Chile.
The article begins by analyzing the results of exports and imports of Argentina and Chile with
Indonesia. Then, paying special attention to exports to Indonesia, the main competing countries for
both Latin American countries will be listed, keeping in mind that they export identical or similar
products to the Indonesian archipelago. Subsequently, trade policies and bilateral trade with
Indonesia will be analyzed in the cases of Argentina and Chile. Then, it will be emphasized how
important it is to understand the cultural and religious factor in businesses with Indonesia, in order
to be able to significantly increase exports to that country. Finally, the article concludes with words
Latin American Journal of Trade Policy 8 (2020) – Universidad de Chile
89
of reflection on the mentioned topics and how Argentina could learn from Chile’s trade experience,
and vice versa.
Comparative analysis of the export-import statistics of Argentina and Chile with regard to
Indonesia
Argentina and Chile are two South American countries with which Indonesia has particularly good
diplomatic, political, and trade relations. However, in this last aspect, a greater depth is necessary. In
this sense, Indonesia’s trade agreement with Chile represents an important step towards expanding
businesses. With Argentina, it would be a good opportunity to do the same, but it is necessary to
reach a trade agreement with the Mercosur bloc.
When analyzing exports from Argentina and Chile to Indonesia, some conclusions may be derived.
Annex 1 presents a comparison of these exports in the period 2015-2019, for the 99 chapters of the
Harmonized System (HS). In the first place, it stands out that Argentina has exported more to
Indonesia, compared to Chile. Secondly, Argentina has exported goods included in 46 HS chapters,
while Chile has exported only goods included in 23 chapters, which demonstrates -at the chapter
level- a more diversified matrix of Argentine exports to Indonesia. Perhaps one of the most
interesting products to compare between Argentina and Chile are wines. Table 1 shows the
comparative development of wine exports (HS subchapter 2204) since 2015. For this product, Chile
has shown better performance than Argentina. It remains to be seen what happens from this year,
considering the entry into force of the IC-CEPA.
Table 1: Indonesia’s wine imports from Argentina and Chile.
Product: HS Code 2204 (wine of fresh grapes). US Dollar thousand.
Indonesia’s imports from Argentina
Indonesia’s imports from Chile
2015
2016
2017
2018
2019
2015
2016
2017
2018
2019
16
124
313
571
953
60
477
876
1,386
2,104
Source: Trade Map.
When analyzing the imports of Argentina and Chile from Indonesia (Annex 2), it is shown that
Argentina imports more from Indonesia, contrasted with what Chile does. However, when
considering the HS chapters that comprise said imports, it is observed that Chile has a greater
diversification (41 chapters) compared to Argentina (38 chapters). Subsequently, the main exchanges
of merchandise between Argentina - Indonesia and Chile - Indonesia will be specifically analyzed.
When comparing the exports of Argentina and Chile with other countries that export similar products
to Indonesia, for the period 2015-2019, it can be seen in Table 2 that Argentina is among the countries
with the highest annual growth in value (8%). In the same period, Chile has a 1% decline, explained
by an abrupt fall in its exports in 2016, and then has an irregular growth until 2019. Chile’s growth is
important if the period of analysis is reduced to 2016-2019 (and not 2015-2019).
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