Leader Talks: Arsjad Rasjid on Strengthening Trade and Investment Ties with Cambodia...
Leader Talks: Arsjad Rasjid on Strengthening Trade and Investment Ties with Cambodia and Promoting ASEAN Centrality
The Indonesian Chamber of Commerce and Industry (KADIN) Chairman, Mr. Arsjad Rasjid.
The Indonesian Chamber of Commerce and Industry (KADIN) Chairman, Mr. Arsjad Rasjid, spoke with CIR Leader Talks about how Cambodia and Indonesia are poised to enhance trade and investment ties over the next five years, focusing on three key areas: strengthening bilateral relations, promoting digital transformation, and fostering collaboration in the agricultural sector.
Founded in 1968 and established by law in 1987, KADIN is self-funded, and the only nationwide business organization mandated by the Indonesian Government. The organization acts as the voice of the private sector and maintains close relations with the Indonesian government.
The trade body most recently selected Indonesian national and well-known local businessman Dalton Wong, who is Chairman of Speedwind and the current IndoCham President as Vice-Chair for its Cambodia and Vietnam chapter. The organization is also working with the locally run Indonesian Chamber of Commerce in Cambodia (IndoCham) launched in 2021 as a signature project of the current Indonesian Ambassador and operates under the country’s national phrase Bhinneka Tunggal Ika “Unity in Diversity” (one is more).
Read more: IndoCham Hosts Meeting with KADIN and MPTC to Drive Economic Ties Between Indonesia and Cambodia
This month the trade body hosted a high-level meeting between the Indonesian Chamber of Commerce and Industry (KADIN), the Ministry of Post and Telecommunications (MPTC), and leading stakeholders from international telecommunications companies in Cambodia – organized with assistance from market consultancy firm AquariiBD and attended by Cambodia Investment Review.
KADINs three principal measures
KADIN has outlined three principal measures to achieve its goals, which include:
Increasing people-to-people interactions
Leveraging digitalization to boost trade
Exploring new market opportunities in emerging sectors
“To solidify bilateral relations, KADIN is working to facilitate more flights between Cambodia and Indonesia, capitalizing on the growing interest in business opportunities between the two nations. In 2022, Cambodia and Indonesia witnessed a significant increase in merchandise trade volume, reaching $948.53 million, a 48% increase compared to the previous year,” Arsjad Rasjid said.
Cambodian Trade Minister Pan Sorasak visited Indonesia in March aiming to boost bilateral trade to over $1 billion within the year. KADIN stated it is committed to facilitating further trade and investment between the two countries, identifying new sector opportunities, and providing essential communication channels to ensure success.
Harrison White had a one-on-one interview during the delegation Phnom Penh visit in April 2023.
“To deepen people-to-people interactions, KADIN is promoting cultural exchanges, educational partnerships, and business networking events. These initiatives will facilitate a better understanding between Cambodian and Indonesian businesses, fostering collaboration and investment. Increased flights and connectivity will also enable more Indonesian tourists to visit Cambodia, boosting the local economy and further strengthening ties,” he added.
Digitalization a main economic driver
Arsjad Rasjid stated that digitalization has emerged as a key driver for increased trade between Cambodia and Indonesia. KADIN aims to capitalize on this trend by utilizing the Marketplace Lending Platform and Wiki Entrepreneur legacy projects to provide training, mentorship, financing options, and other resources to aspiring entrepreneurs in both countries. “By connecting these entrepreneurs and facilitating partnerships, KADIN hopes to create a supportive ecosystem that fosters long-term growth in trade and investment,” he said.
Read more: Indonesian Ambassador H.E. Sudirman Haseng Leaves Lasting Economic Diplomacy Legacy in Cambodia
“As part of its digitalization efforts, KADIN is also focusing on digital skills training for SMEs, expanding e-commerce platforms, and promoting financial technology services. By providing the necessary tools and knowledge, businesses can tap into new markets and opportunities, enhancing overall competitiveness in the region,” he added.
Leading stakeholders from both the public and private sector attended the meeting.
The third measure involves exploring market and investment opportunities beyond traditional sectors, concentrating on digitalization, new industrial components such as electric vehicles, innovative agriculture to strengthen food security, and financial technology services.
While according to Arsjad Rasjid one of the most significant challenges in achieving his stated goals is the lack of awareness about each other’s markets and investment opportunities in emerging sectors. He believes that by increasing communication between the two countries and implementing the measures, both nations can address this challenge and unlock new growth opportunities.
Actively engaging with the Cambodian government
As the chair of the ASEAN Business Advisory Council (ASEAN-BAC), Cambodia is expected to play a pivotal role in boosting trade and investment in the region while Cambodia’s strategic location and rapidly developing economy make it an ideal gateway to Southeast Asia and is considered major advantages.
ASEAN-BAC is also actively engaging with the Cambodian government to understand their priorities and concerns, advocating for policies and initiatives that support trade and investment in the wider region. This according to KADIN includes promoting tariff reductions and implementing legacy projects such as the ASEAN Business Entity, which aims to strengthen intra-ASEAN investment by offering advantages to businesses operating in the region.
Read more: CDC urges successful Indonesian investors in Cambodia to ‘tell their story’
“Indonesia has emerged as a driving force behind digital transformation in Southeast Asia, with its digital industry growing from $41 billion in 2019 to an expected $130 billion by 2025. The country’s large, digitally savvy population, high mobile penetration, supportive government policies, and improvements in digital infrastructure have fueled this growth,” he said.
The meeting was hosted at Baliku at L’Orangerie Restaurant, Koh Pich on April 3, 2023.
“Cambodia can benefit from Indonesia’s digital transformation by adopting similar strategies to promote digital infrastructure and encouraging micro, small, and medium enterprises (MSMEs) to enter the digital market,” he added
Furthermore, Arsjad Rasjid believes that Cambodia can leverage the success of e-wallets as a payment method in Indonesia to increase financial inclusion among its population, particularly lower-income groups. Participation in ASEAN-BAC’s ASEAN QR Code and Wiki Entrepreneur legacy projects will promote the use of QR codes for payment transactions and provide a platform for SMEs to connect with various partnership programs from companies and institutions, encouraging greater adoption of digital technologies.
Cambodia and Indonesia to empowering SMEs
Cambodia and Indonesia also looking to collaborate and empower Small and Medium Enterprises (SMEs) in the agricultural sector which according to KADIN is essential for sustainable growth. By sharing knowledge, experiences, and resources, both countries can improve their agricultural production and marketing capabilities, enhancing competitiveness in the region’s economy.
One specific initiative to consider is the Inclusive Closed Loop model, an ASEAN-BAC legacy project that offers a holistic approach to empowering small and medium agricultural enterprises. This model addresses issues related to finance, knowledge, technology, and market access, promoting sustainable agriculture practices such as eco-friendly farming, fair trade policies, and the establishment of sustainable supply chains.
KADIN Chairman, Mr. Arsjad Rasjid and H.E. Chea Vandeth, Minister of Post and Telecommunications.
“The Inclusive Closed Loop model has already been successfully implemented in Nusa Tenggara Timur, one of Indonesia’s poorest regions, resulting in increased crop productivity for more than 30,000 farmers. By applying this model, Cambodia can benefit from Indonesia’s expertise and adopt sustainable agricultural practices that boost productivity and competitiveness,” Arsjad Rasjid said.
“Additional collaboration opportunities include knowledge sharing, technical assistance, and trade partnerships. By sharing best practices and experiences, both countries can learn from each other and improve their agricultural production and marketing capabilities, ultimately contributing to regional economic development,” he added.