By Eko Hartono, Consul General of Indonesia in Jeddah
Indonesia and Saudi Arabia established diplomatic relations in 1950. The relationship is particularly important because Saudi Arabia is the birthplace of Islam and Indonesia is home to the largest Muslim population in the world. both are Muslim-majority countries. In addition to social and religious relations, economics and trade relations are also particularly important, especially in the sectors of oil (energy) and human resources (migrant workers).
The historical link between Indonesia and Saudi Arabia was Islam. Many Muslim traders and ulema arrived in the Indonesian archipelago from the Arab world during the advent of Islam around the 13th century. Since the beginning of the 20th century, Indonesian Muslims have performed the hajj pilgrimage to Mecca. As the country with the largest Muslim population, Indonesia sends the highest number of hajj pilgrims among Muslim countries.
Due to the Covid pandemic two years ago, this year the Kingdom of Saudi Arabia allowed Indonesia to send 100,510,000 hajj pilgrims. Indonesia expresses its highest appreciation to the Saudi government for providing sufficient hajj quota to Indonesian pilgrims. Indonesia is the country with the most quotas compared to other countries apart from Saudi Arabia. Hajj quota for the year 1440H/2019M, up to 202,487 people (regular pilgrims) and 15,663 people (special pilgrims). The total congregation is 218,150 people. Indonesian Hajj officers are 2,850 people.
The most important thing to consider when serving Indonesian pilgrims is to provide food that tastes Indonesian. Catering companies are required to use spices from Indonesia. Therefore, an increase in exports of Indonesian products to Saudi Arabia is expected.
Recently, the trade balance between Indonesia and Saudi Arabia also increased by 31.34% compared to the same period last year. Indonesia’s non-oil and gas exports to Saudi Arabia also increased by 27.24% in the second quarter of 2021 compared to the same period last year. This year there is an increase in demand, including for products such as fish, wheat, processed foods, vegetables and vegetable fats/animals.
This increase in exports is the result of the development of the business sector in SMEs (small and medium-sized enterprises), with a rapidly growing middle class. This is, to some extent, thanks to the expansion of modern grocery stores in regions outside of Java and other major urban areas, increasing the market presence of import products. Additionally, the COVID-19 pandemic has increased e-commerce transactions. Online shoppers have grown from 75 million to 85 million. This makes Indonesian communities so convenient with the fastest growing modern sales channel.
This year, according to the World Bank, the Indonesian economy is expected to recover by 4.4%, supported by improving domestic demand and the positive impact of a stronger global economy. We also expect growth to ease to 5.0% in 2022, thanks to reduced uncertainty.
Indonesia’s economy in the second quarter of 2021 also grew by 7.07% compared to the same period last year. This growth was faster than the World Bank forecast of 4.4%. Due to the improvement in domestic demand and the positive impact of a stronger world economy, it was particularly supported by a very significant growth in exports of 31.78% compared to the same period.
In other economic areas, relations between the two countries continue to improve with cooperation plans in the areas of national product standards, agricultural issues and the fight against terrorism. In other economic areas, relations between the two countries continue to improve with cooperation plans in the areas of national product standards, agricultural issues and the fight against terrorism.
In the field of tourism, the reciprocal visits of the inhabitants of the two countries are also increasing. this is evident from the large number of visa applications from Saudi citizens in Indonesia. This visit was to cover the G20 meeting, the International Parliamentary Union meeting, the Global Platform for Disaster Risk Reduction meeting and other activities. Furthermore, in the field of renewable energies, cooperation continues to intensify to increase the sources of electricity in Indonesia for the development of energy projects in Siguling and Singkarak.
In political relations related to the implementation of the G20, Indonesia expressed its gratitude for the support of Prince Mohammed Bin Salman in preparing thematic arrangements such as blended finance for development, adaptation and climate change mitigation, food security, fair and equitable energy transition. mechanisms. Prince Mohammed Bin Salman confirmed the commitment to announce concrete cooperation for the restoration and conservation of mangroves at the G-20.
Indonesia’s success in the economic field encourages the confidence of the international community, especially the members of the G-20, to nominate Indonesia to lead the G20 Presidency in 2022. The G20 Presidency is a forum international economic cooperation made up of 19 countries and the European Union. Indonesia is mainly focused on 3 things, namely inclusive healthcare, digital-based economic transformation and transition to sustainable energy.
Through these pillars, Indonesia encourages and ensures equitable access to COVID-19 vaccines, promoting sustainable and inclusive economic development which will be implemented through the participation of SMEs and the creative digital economy. While maintaining the aspiration to continue improving our collective ability to deliver shared prosperity among nations, through various global tax reform efforts, enhanced cooperation, deepening infrastructure financing and promotion of more democratic and representative international cooperation.
There are 438 activities during Indonesia’s G20 Presidency in 2022, spread across 25 cities in Indonesia. The implementation of the various activities of the G20 Presidency is expected to increase domestic consumption up to 1.7 trillion rupees, increase the national GDP to 7.4 trillion rupees, involve MSMEs and absorb around 33,000 workers in various sectors.
The 17th G20 Heads of State and Government Summit will take place on November 15-16, 2022 in Bali. The Summit will be the culmination of the G20 process and the intense work carried out in ministerial meetings, working groups and engagement groups throughout the year.
The G20 goals as a strategic role in ensuring future global economic growth and prosperity. Together, the members of the G20 represent more than 80% of the world’s GDP, 75% of international trade and 60% of the world’s population.