Indonesia lies near the equator which is why

Indonesia lies near the
equator which is why they have an all year round growing season and a tropical
climate with the coastal plains averaging 28°C,
the inland and mountain area 26°C, and the higher mountain
regions 23°C. Rainfall near the equator
is plentiful and well-distributed throughout the year. However, the rainfall
gets seasonal as distance from the equator increases with maximum amounts of
summer and minimal amounts of winter. Frost only occurs at the peak of high
mountains. The area has relatively high humidity levels ranging from 70% to
90%. The Western and Northern parts of Indonesia face most precipitation due to
the northward and westward moving monsoon clouds which are heavier and moister.

 

Economic
Information

The
President of Indonesia is in charge of both the state and the government.
Indonesia holds a mixed economy which combines both private and public
enterprise. The current unemployment rate in Indonesia is 5.5% which has been
significantly reduced from 2016. This shows that Indonesia is becoming more
economically wealthy and productive by opening new businesses. The GDP per
capita in Indonesia is $3974.1 which is 31% of the world’s average. The trade
in the agriculture sector of Indonesia is 15%, the industry sector is 47%, and
the services sector is 37%. Indonesia mainly exports woven clothing and apparel
articles, electrical machinery and rubber to Canada and its key imports from
Canada are cereals, wood pulp, and fertilizer. The trade balance between
Indonesia and Canada is $365.7 which means that Canada exports more than it
imports from Indonesia.

Indonesia Exports to Canada

Indonesia Imports from Canada

Rubber – $96.6M

Wheat  – $466M

Woven Clothing – $ 79.8M

Fertilizers – $311m

Electrical Machinery &
Equipment – $77.1M

Woodpulp – $212M

 

Competitive
Advantage

Indonesia’s competitive
advantage is its access to natural resources specifically in the energy sector.
Indonesia has an absolute advantage because they are able to extract and export
crude oil and petroleum gas more efficiently than competing countries. This
surplus of key natural resources allows Indonesia to export their surplus to the
United States and China, their two key trading partners. Indonesia has been
active in the oil and gas sector for the past 125 years and is known as the
fifth-largest liquefied natural gas exporter1.
Indonesia consists of energy reserves of more than 7 billion barrels of oil and
about 150 trillion cubic feet of gas. Indonesia’s potential petroleum resources
are about 150 billion barrels of oil and nearly 410 trillion cubic feet of gas.
2Getting
these resources out of the ground and shipped to other places provides Canadian
businesses with the opportunity to invest in future infrastructure developments.
Canadian businesses have an opportunity to support the energy sector by
assisting in the development of needed infrastructure projects. Energy demand
and manufacturing activities are creating great investment opportunities in the
building of pipelines which is a reliable form of transportation to distribute
the crude oil and petroleum gas to other countries. Moreover, vehicle ownership
in Indonesia has increased significantly from the past year creating a higher
need of petroleum gas and creating more business opportunities for Canadian
businesses. Furthermore, new gas plants will be desirable if the need for petroleum
continues to increase. Using Canadian experience, expertise and knowledge in
building infrastructure, they can look to invest in Indonesia and provide them
with innovative pipelines and storage, reserves or oil trading hubs to support
the future of Indonesia’s energy sector. This will help Indonesia to slow or
prevent production declines on mature fields of oil and gas. A number of
Canadian businesses currently operate in Indonesia, some of which include
Manulife Financial, Sunlife Financial, Husky, Talisman Energy and
Sherritt.  The competitive advantage
offered by Indonesia can benefit Canadian businesses in the energy sector in many ways. Indonesia is looking for companies who
have the skills and

 

International
Information

Canada
and Indonesia have established a strong bilateral trade relationship dating
back to 1952, when an agreement was signed to support each other’s economic
development. This agreement was signed to open diplomatic missions in their
respective capitals. Both countries have a long history in engaging in the
protection of Human rights, freedom of religion, democracy, governance and
pluralism. Both countries are also a part of many international trade
agreements including Association of Southeast Asian Nations (ASEAN),
Asia-Pacific Economic Cooperation (APEC), Regional Forum (ARF), the G20 and the
World Trade Organization (WTO).

These
agreements affect Canada’s status as a trading partner of Indonesia because it
helps to promote trade between the two countries by allowing duty-free trade
which is basically trading or importing goods without being taxed on them. This
is considered a trade barrier therefore, the trade agreements help to increase
trade between countries and develop economies. Trade agreements has been
beneficial by allowing a freer flow of goods and services which provides
businesses with access to better raw materials, talent, capital, and
technology.

A
joint venture between Indonesia and Canada is Blackberry. Indonesia sees a
potential market for keyboard blackberry phones for which the operator of PT
Tiphone Mobile Indonesia Tbk has formed a joint venture with blackberry called
PT BB Merah Putih to make its mobile devices in Indonesia.  

Organizations Indonesia is a part of:

World Trade Organization (WTO) , Asian Development
Bank, United Nations, ESCAP, OIC (Organization of the Islamic Conference), Group
of 20 , Organization for Economic Cooperation and Development, The World Bank,
International Tropical Timber Agreements, The Kyoto Protocol, The Nuclear Test
Ban Treaty and the World Health Organizations.

 

Cultural
Information

DO’s

1)       Greet the eldest
and most senior person present with a warm hello and firm handshake as a sign
of respect, and then everyone else down their age and position. Try asking
about the person’s health upon greeting.

2)       Make sure to
dress up appropriately, especially women. Women are expected to wear clothing
that covers them up to a certain extent which includes no sleeveless tops or a
skirt that’s too short.

3)       Make sure to have
your business card printed double-sided, one side being English and the other
side in Bahasa (Indonesian Language) or possibly Chinese depending on whether
or not you will be working with Chinese Indonesians.

TABOOS

1)       Don’t look at
someone directly in the eyes to prevent them from feeling uncomfortable and
thinking that you are staring at them, instead look down or focus on the chin
or forehead.

2)       Don’t make
handshakes to hard or strong. Handshakes are very normal in the Western
countries when meeting someone for the first time. In Asian countries like
Indonesia handshakes are very loose with very light pressure added, as opposed
to Western country handshakes where a firm handshake is a sign of strong and
sturdy character and personality. When an Indonesia female initiates a
handshake it might be very light.

3)       Don’t put out
your personal opinion on a specific political figure or a historical event that
took place in Indonesia unless you know the complete information about it.

4)       Muslims pray five
times a day so; make sure you don’t book a meeting with them at lunch time or
during the times of their prayers. Prayer times are listed on Islamic Finder as
well as so mosques.