Jakarta. Turkish President Recep Tayyip Erdogan told his Indonesian counterpart Prabowo Subianto on Wednesday that his country wanted to see greater bilateral trade, but one that is fair for both countries. 

Erdogan is now back in Indonesia after setting foot in the country back in 2022. As part of his visit, he met with Prabowo in the latter’s Bogor Palace for some discussions on trade, to name a few. 

According to the Central Statistics Agency (BPS), Indonesia-Turkiye trade had jumped from $2.1 billion in 2023 to almost $2.4 billion the following year. Indonesia’s trade surplus with Turkiye even soared from just $940 million to nearly $1.5 billion over the same period. 

Erdogan’s Indonesia visit saw the signing of a memorandum of understanding on bolstering bilateral trade cooperation. The leaders’ joint statement issued after the meeting wrote that they had agreed to set a trade volume target of $10 billion or about fourfold what they are currently at. However, Erdogan revealed that the two-way trade in the future should be “balanced”, alluding to his intentions to shrink the trade deficit with Jakarta.

“[We discussed] how we can increase our annual trade to $10 billion and make it balanced. We will try to achieve it together. We are committed to doing everything that we can to unlock that trade volume,” Erdogan said.

Prabowo, too, spoke of wanting to speed up the Indonesia-Turkiye Comprehensive Economic Partnership Agreement (CEPA) negotiations. This free trade agreement has been sitting at the negotiating table since 2017. Prabowo said: “We are committed to increasing trade that is mutually beneficial. We should quickly finalize our CEPA talks. We have agreed to expand market access to the goods produced by the two countries.”

Prabowo, however, did not give a deadline for the CEPA talks conclusion -- at least during the press conference.

The leaders’ joint statement, however, wrote that the $10 billion trade volume would be “achievable” with a preferential trade agreement scheme. This includes establishing a limited preferential trade pact as the first stage by 2026 “in principle”. As the name suggests, such an agreement is limited in nature and only reduces the agreed number of tariff lines. On the contrary, a CEPA is more substantial and covers more areas, including investment. The joint statement wrote that the preferential trade scheme could be a building block for the Indonesia-Turkiye CEPA agreement that would be established at a later stage.