The Netherlands Sends Largest Ever Trade Mission to Indonesia

This week, a group of Dutch politicians and businessmen, led by prime minister Mark Rutte, will pay a four day visit to Indonesia.

The aim of the visit is to smoothen bilateral relations and search for business opportunities between both countries.

This Dutch group, which includes more than one hundred Dutch company delegates, forms the largest Dutch trade delegation that has visited Southeast Asia’s biggest economy in the modern history.

However, relations between the Netherlands and Indonesia are still complex today.

Obviously, the complexity of relations between both countries traces back to the colonial period, which brings along more emotions, in particular on the part of Indonesia.

Last year, commotion emerged after the Dutch parliament refused to sell army tanks to Indonesia because the Indonesian government might use these against its own people. This then became a laughing stock for Indonesians who pointed to the colonial past.

Moreover, in 2010, Indonesian President Susilo Bambang Yudhoyono cancelled a trip to the Netherlands at the last minute because the Dutch government could not guarantee Yudhoyono’s inviolability regarding a lawsuit filed by the government-in-exile of the Republic of South Maluku (RMS). The RMS issued legal proceedings to have Yudhoyono arrested upon entering the Netherlands.

Indonesia is a highly promising market. The country contains a large population (over 240 million people) with a rapidly expanding middle class.

Per capita GDP has been increasing strongly in recent years, implying that the expanding middle class segment has more and more money to spend.

Regarding commodities, Southeast Asia’s largest economy contains an abundance and variety, including palm oil, coal, nickel, rubber, and cocoa.

Despite the political sensitivities, trade relations between both countries have been growing robustly.

In the last three years, bilateral trade rose 25 percent to approximately €3.5 billion in 2012. As such, Indonesia is the fastest growing export market for the Netherlands in Asia.

However, there is still ample room for further growth and that is why the Dutch trade delegation, which includes Shell, Unilever, Philips and ING, is heading for Indonesia this week.

Source: indonesia-investments