Edited Transcript of the Media Wrap-Up with Minister for Foreign Affairs Dr Vivian Balakrishnan in Jakarta, Indonesia, 18 July 2019

Minister for Foreign Affairs Dr Vivian Balakrishnan spoke to Singapore media based in Jakarta at the end of his working visit to Indonesia from 16 to 18 July 2019. The following is an edited transcript of the wrap-up.

Minister Balakrishnan: I was very glad to be here. I wanted to make this visit to Indonesia soon after the successful conclusion of their elections. It was a good opportunity to meet with President Joko Widodo (Jokowi) and the senior members of his team. As you know, Indonesia is our largest close neighbour. We have a vibrant, important account, and I am glad to note that we have excellent relations. For the last five years, Singapore has been the largest foreign investor in Indonesia. We are also Indonesia’s third-largest trading partner. There has been a long-standing backdrop of a strong, close relationship which goes beyond the economy. At the political level, Prime Minister Lee Hsien Loong and President Jokowi get along very well. They meet very frequently and we are very happy that President Jokowi will be attending our National Day Parade commemorating Singapore’s Bicentennial this year.

This visit has been a good opportunity to catch up with my Indonesian contacts, and also to gain a deeper appreciation of President Jokowi’s priorities. He outlined his vision in a recent speech – three areas on which he is focusing are infrastructure development, elevating the capacity of human resources in Indonesia, and promoting investments. I think that these are areas in which Singapore has worked, and will continue to work closely, with Indonesia.

Channel News Asia (CNA): Minister, you discussed the Singapore-Indonesia Leaders’ Retreat with President Jokowi and your counterpart, Foreign Minister (FM) Retno Marsudi. Could you elaborate on what we can expect from the next Leaders’ Retreat in Singapore, e.g. what the deliverables will be, and when it will be held?

Minister Balakrishnan: We hope the Leaders’ Retreat will be held later this year. As I have said, Prime Minister Lee and President Jokowi meet very frequently. Nevertheless, having a Leaders’ Retreat on a regular, annual basis lends a certain cadence. It makes sure that we all do our homework. During this visit, I updated President Jokowi on the progress in the various bilateral initiatives so far. For instance, you will recall that President Jokowi and Prime Minister Lee launched the Kendal Industrial Park (KIP) in 2016. The KIP is doing well. Over half a billion US dollars’ worth of investments have been committed, and jobs are being created. But it is not just about investments and ‘hardware’. Just as importantly, Singapore has worked with Indonesia on establishing a polytechnic at the KIP, so that the workers there will have the relevant vocational skills for the jobs that are being created. In short, it is this combination of working together to attract investments, create jobs and elevate human resource capacity-building, that we are looking at.

Another example is what we are doing in the Nongsa Digital Park, in keeping with the new digital economy. Companies are paying attention to this. You will also recall that in Batam, we have collaborated on the Batamindo Industrial Park, in which there is renewed interest now. I think we are at a point in time when globally, people are reviewing their supply chains. This is an opportunity for both Indonesia and Singapore to work more closely together, to attract investments and be part of this vital global supply chain. So we reviewed some of this cooperation, and are also on the lookout for further opportunities, focusing on infrastructure, attracting more investments, and the opportunities that this age of digital disruption and shifts in global value chains brings. There will be problems and challenges on one hand, and opportunities on the other. Both President Jokowi and FM Retno agreed that these are areas in which we should work more closely together. We are preparing for the Leaders’ Retreat to identify similar new areas where we can do more together.

CNA: President Jokowi and Prime Minister Lee met on the sidelines of the recent ASEAN Summit (in June 2019). President Jokowi said that the Leaders’ Retreat would be held sometime in December. Is that confirmed?

Minister Balakrishnan: We are not yet ready to confirm the dates, but like I said, we are looking for a date sometime later this year, if possible. Both Prime Minister Lee and President Jokowi are very busy. Nevertheless, we will get the homework done. As I have said, we want to make sure that our efforts dovetail with President Jokowi’s own domestic priorities as well. All in all, it is going well.

CNA: Minister, on new areas of cooperation, what can we expect from Singapore and Indonesia?

Minister Balakrishnan: We are going to focus not only on investments and ‘hardware’, but also on the ‘software’. Indonesia is looking to ramp up its training capacity. Clearly, this is a very large-scale undertaking. But what we can work on, for instance, is to train the trainers. This allows Indonesia to scale up and bootstrap its own training capacity. And this is an area in which Singapore has expertise. We have an excellent vocational training sector in Singapore; all the foreign visitors who have come to see our ITE have been deeply impressed by it. I think there is a lot of interest not only in Indonesia, but in many other parts of the world, because the key challenge is to match skills with the new jobs which are emerging. Just as we are focused on this within Singapore – from restructuring our economy to SkillsFuture and more – these same lessons that we glean from this journey are also relevant to our neighborhood.

Within ASEAN, Indonesia is a key pillar, and we have a series of meetings coming up. Another area where I would say Indonesia and Singapore are attuned and on the same wavelength is in protecting ASEAN Unity and Centrality, maintaining an open and inclusive regional architecture, and further enhancing trade flows within ASEAN. To give you an example, we have signed an ASEAN e-Commerce Agreement, and have a single window for customs clearance within ASEAN. This is all the more salient now, when we are witnessing disruptions to global trade patterns. In fact, intra-ASEAN trade is an opportunity which has not yet been fully tapped. Despite the bad weather on the global stage, I think ASEAN still represents a bright spot. If you look at Indonesia, its growth rate is over five percent, and can be even higher. But in this time of turbulence, to maintain that kind of growth rate is a commendable point for Indonesia.

As Indonesia’s biggest foreign investor – the flow of investments was about US$9.2 billion last year – we clearly have a stake in their success. We are also on the same wavelength in terms of maintaining the open and inclusive regional architecture, and working in favour of free trade and investment promotion. The more we can do bilaterally, and regionally within ASEAN, the better. These are all areas where we work very well together.

The Straits Times (ST): FM Retno Marsudi spoke yesterday about cooperation between Singapore and Indonesia to set up aircraft maintenance, repair and overhaul facilities in Batam, Bintan and Karimun (BBK). Could you tell us more about this, and what is being done to energise the region?

Minister Balakrishnan: There are interesting prospects opening up in the BBK region. Singapore has been engaged in the BBK region for two decades, and I am glad to see that there is renewed interest. There is still further regulatory reform needed in Batam and Bintan, but President Jokowi has assured us that this is well underway. We think this will present opportunities for new investments and new services to be developed. And because we are geographically so near and, in a sense, integrated with Batam and Bintan, we work closely with Indonesia on these emerging opportunities. So watch that space.

ST: One last thing about the Flight Information Region (FIR), since this was discussed by you and FM Retno. She said that there has been some progress, and both Singapore and Indonesia have an understanding. Could you elaborate on this?

Minister Balakrishnan: Well, we did not go into depth. You’re right in that there has been progress, particularly in the discussions between Minister for Transport Khaw Boon Wan and Indonesia’s Minister of Transportation Budi Karya Sumadi. Let me first take a step back and set the context. This is not a question of sovereignty. I am glad that FM Retno has also emphasised that it is not a question of sovereignty. It is basically about improving safety and efficiency in one of the busiest, and growing, air sectors in the world. We are having good discussions between the Transport Ministers and the Civil Aviation Authorities. But the key point is this: any changes must result in better safety and higher efficiency. That is what we are focused on. I would leave the technical agencies and Transport Ministers to continue their productive discussions, keeping in mind that the ultimate objective is safety and efficiency.

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