Towards strengthening Indonesia-Namibia economic relations

Resumen

This paper discusses current Indonesia-Namibia bilateral economic relations and explores opportunities and the way forward in elevating this existing relationship to a higher level. The study shows that the respective foreign policy agendas of these two nations coincide with their common interests particularly to enhance economic relations through economic diplomacy. Based on the product competitiveness mapping analysis, the study concludes that there are potential opportunities to strengthen bilateral trade relations due to the complementarity of both countries’ export products. The study also reveals the competitiveness of the two countries’ respective export products remains low. The partial equilibrium free trade simulation employed shows that both countries would potentially benefit from bilateral FTA arrangements. This is based on assumed higher trade volumes and consumer surpluses, which would offset predicted tariff revenue loss. The study also conducted the future scenario planning and trends analysis, in which the best scenario from the case is Scenario 3, where both countries should pursue Indonesia-SACU PTA as both parties would be better off based on the predicted economic potential benefits. Apart from trade, promoting Indonesian outbound investment and technical cooperation are another potential win-win economic cooperation for both countries.