Brazil eyes RI's biofuel, aims for stronger defense ties
 
Jun 17, 2013
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Brazil is eyeing untapped cooperation potential in many areas with Indonesia, says Brazilian Deputy Foreign Minister Maria Edileuza Fontenele Reis.

Among the sectors being looked at were biofuel production, aviation and military, Reis said in an interview with The Jakarta Post and Antara news agency on the sidelines of the sixth Foreign Ministers Meeting of the Forum for East Asia-Latin America Cooperation (FEALAC) in Nusa Dua, Bali, on Wednesday.

“Considering Brazil is a country with 200 million people and Indonesia with 240 million people, we are finding that there is much more we can do,” she said.

Vale SA, a Brazilian mining corporation that has also been recognised as the second-largest mining company in the world, has invested more than US$2 billion in nickel mining in Sulawesi. In 2007, Vale acquired majority shares in nickel maker PT International Nickel Indonesia, Tbk, changing its name to PT Vale Indonesia.

When asked about what sectors should be prioritised to enhance trade ties between Indonesia and Brazil, Reis quickly said, “aviation”.

Brazil’s Embraer is one of the world’s most respected aircraft industries. It produces both military and commercial aircraft.

“[Indonesia and Brazil] have a very important cooperation that is being designed in the area of defense. Indonesia is also interested in establishing an aircraft maintenance centre. So aviation is an area that has plenty of space for development,” Reis said.

Indonesia’s Air Force has agreed to purchase 16 Brazilian-made EMB-314 Super Tucano aircraft, along with the supporting tools, maintenance and training in a deal amounting to US$143 million.

Embraer’s commercial aircraft precuts have also garnered interest from Indonesian airlines. State-owned regional carrier Merpati Nusantara Airlines has announced plans to purchase about 20 Embraer E145 series while Sriwijaya Air, the third-largest domestic airline after Lion Air and Garuda Indonesia, is set to fly with 20 Embraer E190 series.

Sriwijaya Air inked the deal with Embraer to order 20 E190 jets worth around $1 billion in June 2011. The Embraers are expected to be operated by Sriwijaya’s new full-service subsidiary, Nam Air.

Reis said that Brazil was also interested in cooperating with Indonesia for the production of biofuel, particularly given Indonesia’s soil and weather, which are considered suitable for planting sugarcane, one of the best raw materials of biofuel.

“We are among pioneers in the production of both ethanol and biodiesel. Indonesia is interested in this because you cannot rely on oil production. You need alternative energy to reduce dependency on fossil fuels and to save the environment,” she said.

The Indonesian government, however, has yet to materialise any particular cooperations for biofuel production with Brazil even though a Memorandum of Understanding (MoU) on that was signed in 2008.

“We are open because we have the technology and the companies that produce and have plants for the transformation of the sugarcane into ethanol. We also have the technology to use the bagasse of sugarcane to produce energy to move the power plant. We can also work on the technological aspect, such as the transfer of technology,” she said.

On the sidelines of the 67th UN General Assembly at UN headquarters in New York, US, in September last year, President Susilo Bambang Yudhoyono met with Brazilian President Dilma Rousseff and invited his Brazilian counterpart to visit Indonesia sometime this year.

In November 2008, Yudhoyono made a state visit to the Brazilian capital of Brasilia where the two countries also signed a Strategic Partnership declaration.

Trade volume between the two countries in 2012 reached $3.46 billion, with a deficit of $484.76 million on the Indonesian side, according to data from Indonesia’s Trade Ministry.

The 2012 figure represented a slight 4.84 percent decrease from 2011’s $3.63 billion, also with a deficit on the Indonesian side of $163.16 million.

 
 
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