Indonesia endorses TPPA deal

  • 27/10/2015
Joko Widodo (Reuters)
Joko Widodo (Reuters)

US President Barack Obama has won Indonesia's endorsement for a contentious trans-Pacific trade deal, with the president of Southeast Asia's largest economy vowing to join.

During a meeting with Obama at the White House, Joko Widodo risked the ire of economic nationalists at home and pledged to join the pact.

"Indonesia is an open economy and with a population of 250 million, we are the largest economy in Southeast Asia," Widodo said in the Oval Office on Monday (local time).

"Indonesia intends to join the TPP."

Twelve countries are currently party to the "Trans-Pacific Partnership" - including Australia, Canada, Japan, Mexico, Vietnam and the United States - creating the world's largest free trade area.

The deal is seen by some as a counterbalance to growing Chinese economic clout in the region.

Widodo's endorsement is a political victory for Obama, who is steering the already completed pact through a hostile Republican-controlled Congress and without the full backing of his Democratic party.

Hillary Clinton, the 2016 election frontrunner, has said the deal falls short of the "high bar" she had set for helping US interests.

Obama has claimed the TPP has the strongest labour and environmental standards of any trade deal signed by the United States.

Widodo's comments will also raise hopes that he will help catalyse the world's most populous Muslim nation, allowing Indonesia to finally punch its weight.

Sketching out a "key strategic partnership" Obama - who lived in Indonesia for nearly five years as a child - said the US needed good relations with Jakarta.

"Obviously I have a very personal interest in Indonesia, given the fact that I spent a bit of time there as a child and have relatives who are Indonesian," Obama said.

"But what is also true is that our partnership is very much in the interests of the United States, given Indonesia's large population, its leadership in the region, its democratic traditions, the fact that it is a large Muslim country with a tradition of tolerance and moderation, and its role in trade and commerce and economic development."

Widodo's visit to the White House was the first by an Indonesian president in a decade and came exactly a year after the former furniture salesman became president.

In the Oval Office, Obama offered his own endorsement, praising the economic reform efforts of a fellow 54-year-old who, like him, swept to power as an outsider promising change.

Indonesia's notoriously protectionist economy has been stymied by systemic corruption, lower commodity prices and China's economic slowdown.

Unemployment among the vast ranks of Indonesia's youth stands at more than 20 percent, and efforts to attract investors have been undercut by economic nationalism, vested interests and red tape.