Monday (5/2), Center for World Trade Studies (CWTS) UGM) received a visit from the National Development Planning Agency of the Republic of Indonesia (Bappenas RI). This visit was carried out in the context of deepening world trade issues related to preparations for the implementation of the High Level Forum on Multi-Stakeholders Partnership activities in 2024. Apart from that, this visit also aims to sharpen the technocratic draft of the 2025 - 2029 Medium Term Development Plan (RPJMN) in the Field of Foreign Policy and International Development Cooperation. Dr. Maharani Hapsari, as Executive Secretary together with Siti Daulah Khoriati, MA and Taufik Adiyanto, S.H., LL.M., who are a team of experts from the CWTS UGM warmly welcomed the Bappenas team.

In the discussion session, Dr. Maharani Hapsari said that the concerns of developing countries is the simplification of the workforce which has occurred due to fluctuations after the pandemic and the need for macro trade. Therefore, to develop policies there needs to be an active role from various parties. Another thing that needs to be considered is corporate intervention in regulations and seeing how a country can take taxes for global redistribution so that it can have an impact on the welfare of the workforce at the micro level.

Steps that can be taken in the short term in making regulations and mapping data are that a framework  is needed at the regional level to include regional voices by increasing the capacity of regional governments. Meanwhile, in the long term, upskilling and upgrading of Human Resources (HR) is needed to overcome the problem of low labor competitiveness.

Siti Daulah Khoiriati, MA added that currently the light manufacturing industry has not jumped to a high-value sector, but has returned to being an exporter of raw commodities. Meanwhile, export destination countries want products with high value. The current free trade is also unfair because of reciprocity, high labor wages accompanied by low productivity, and the existence of labor exports. For this reason, it is necessary to design superior commodities that are encouraged by the government. Currently, Indonesia does not have a focus on superior commodities. This also needs to be adjusted to the large number of MSMEs with various sectors that are their focus.

The presentation was continued by Taufik Adiyanto, S.H., LL.M., who said that the issue of national security is still a consideration in world trade. There is a need to promote inclusive globalization from the WTO in order to return to multilateralism. Apart from that, there are several problems that arise, such as Indonesia needing to carry out pre-shipment inspections so that there is an increase in costs, the issue of Domestic Component Level (TKDN) and standardization, the lack of legal certainty in trade and sustainability which was discussed at the G20, the TRIPS Waiver which should not be rigid for developing countries, and the need for fisheries subsidies.

The discussion closed with a response from Bappenas that it was necessary to boost the quality of education to overcome the human resource gap that occurred because there was no alignment of authority between the central government and regional governments. For example, mapping labor resources is the authority of regional governments, whereas the central government only has this data from ministries .Meanwhile, the mapping of labor resources lies with the regional government. The central government only has data from ministries. Therefore, it is necessary to map regional resource centers in any field, which of course needs to be supported through data integration from various ministries in Indonesia.

The 13th World Trade Organization (WTO) Ministerial Conference (MC) will take place on 26th until 29th February 2024. Bringing several issues regarding the international trade regime, this edition of MC will discuss several pivotal issues, such as: 1) WTO Reform; 2) Agreement on Fisheries Subsidies, 3) Extension of E-commerce, 4) TRIPS Waiver, 5) Agriculture negotiations, and 6) Development related issues. This year’s conference will be held in Abu Dhabi, UAE, amidst the global uncertainty of international peace, fragmentation of the global economy, and deteriorating environmental sustainability. With the existence of these challenging issues, several argue that the conference will produce few progressive results and will likely fail to deliver much. 

Despite skeptical views by some, significant progress on important issues might still be produced from WTO MC13. For instance, the most pivotal issue of WTO reform regarding the dispute settlement mechanism. The US has blocked all new appointments to the Appellate Body as the terms of judges since 2017, whereas all seven seats of the body have been vacant since December 2020 and subsequently disabled the WTO enforcement. In consequence, the incapacitated Appellate Body leads to blockade by countries ruled against with filing an appeal known as “appealing into the void”. Failure to conclude progressive advancement regarding this issue will proliferate current practices of weaponization of trade by countries.

Another important issue is on the E-commerce topics. In Abu Dhabi, the WTO members will convene to address two pivotal issues: the continuation of discussions under the Work Programme on e-commerce and the fate of the Moratorium on Customs Duties on Electronic Transmissions, both initiated in 1998. While the Work Programme appears to proceed smoothly, the Moratorium on Customs Duties on Electronic Transmissions faces significant contention. The Moratorium, which has historically exempted digital products from tariffs, faces polarization. Some member states advocate for its permanence while others, notably developing countries such as India, South Africa, and Indonesia, argue that it deprives them of vital revenue, particularly as digitalization advances and new technologies emerge. Amidst these debates, the uncertain future of the Moratorium underscores the intricate dynamics of negotiations within the WTO and highlights the challenges of reconciling diverse perspectives on digital trade and revenue generation.

Supported by a considerable group of WTO members and business organizations, the Moratorium's extension faces uncertainty as wavering commitments, notably from the US, and concerns about the evolving digital trade landscape come into play. Despite the Moratorium's historical extension every two years by consensus, the prospect of its continuity appears increasingly vague, especially considering the complexities of revenue collection in the digital age and the rising importance of e-commerce in global trade. WTO MC13 should pave the way towards consensus between facilitating digital trade and addressing the developmental needs and revenue concerns of WTO member states to navigate the future of global trade effectively. 

For Indonesia, this MC is also important to address several issues that are closely related to national interest—one of them being the Agreement on Fisheries Subsidies. As a maritime country, Indonesia has an urgent interest in ensuring the economic activities in marine ecosystems are not hampering the sustainability of oceans. Failure to ensure the sustainability of marine resources will not only damage the environment, but also will negatively affect Indonesia’s coastal communities. There are around 120 million people or 50% of Indonesia's population who live in coastal areas, depending on the sea to make their ends meet. However, coastal communities in Indonesia face several challenges that impact their socio-economic development, environmental sustainability, and quality of life. These vulnerabilities are identified as poverty, education, environmental degradation, unsustainable development, and unconnected supply chains.

Regarding this issue, through the Circular Economy Forum 2023 (CEF 2023), Center for World Trade Studies Universitas Gadjah Mada (CWTS UGM) has explored problems that occur at the grassroots level regarding the paradox between Indonesia’s abundant coastal communities and the fact that many of the communities remain under-developed. Furthermore, several stakeholders exhibit an ambiguous understanding of the latent capabilities inherent in an archipelagic nation. Consequently, the current state of the Indonesian fisheries sector still cannot solve many societal uncertainties.

Given the urgency of this challenge, CWTS UGM collaborated with academics, local communities, and the business sector in formulating the “Podocarpus Initiative” in CEF 2023 as a recommendation for the Indonesian government to adopt WTO’s Agreement on Fisheries Subsidies. This initiative emphasizes the establishment of a multi-stakeholder policy forum aimed at promoting the blue economy in domestic policy formulation, with transparent and optimal law enforcement in marine resource extraction sectors to encourage sustainable trade, environmental conservation, business mentoring, and educational curriculum development. The Agreement on Fisheries Subsidies is deemed important due to its key provisions aimed at ensuring the sustainability of the ocean by curtailing harmful subsidies, which are in line with Sustainable Development Goals (SDG) 14. Moreover, the enactment of this agreement holds the opportunities to develop Indonesia's coastal community potential. Giving certainties to small-scale fishers, which become the most vulnerable ocean community in the barn of prosperity, should be navigated by implementing the Agreement and the Initiative. 

Another issue that is crucial to Indonesia is agriculture and Special & Differential Treatment (S&DT). Speaking at the Doha Trade Negotiations Committee (TNC), Indonesia’s Ambassador for WTO HE. Dandy Iswara reiterated the urgent need to ensure that the demands of developing countries can be met through fair S&DT, including S&DT on food security and rural development. In this regard, Indonesia emphasized that “resolving our homework on PSH (Public Stockholding) and SSM (Special Safeguard Mechanism), as well as achieving a balanced and fair outcome in domestic support and cotton (which is a pivotal commodity to Indonesia), should continue to remain high on our agenda.” 

In conclusion, the WTO MC13 outcome is vital to not only reform the WTO as an institution that ensures the effectiveness of international trade, but also to respond to climate change and agricultural issues. Despite skeptical views by some, WTO Deputy Director-General Angela Ellard mentioned that WTO’s current significant progress of informal technical negotiations among its state members are heading towards the goal agreed at MC12 and will be well-functioning in 2024. Every member of the WTO should work expeditiously to reform the WTO dispute mechanism and rebuild trust towards the institution.  Moreover, critical issues for Indonesia sh be properly addressed during the MC 13, especially regarding Agreement on Fisheries Subsidies and Special and Differential Treatment on Agriculture.

Center for World Trade Studies Universitas Gadjah Mada (CWTS UGM) held an International Workshop on Blue Economy (5/12). This event marks the final agenda of Circular Economy Forum (CEF) 2023 that started in early July. This year's International Workshop sets “Sailing Together towards Blue Growth: Tailoring Collaborative Approaches Linking Communities, Governments, and Businesses” as its theme. 

The International Workshop on Blue Economy 2023 is designed in an interactive academic discussion format, highlighting the essential contributions of researchers and academicians to blue economy development in Indonesia and the Global South. The workshop gathers selected participants from CEF 2023’s Call for Papers to present and discuss their research in a closed forum. Following the presentation session, the public were later invited into an open public hearing session—moderated by Suci Lestari Yuana and Muhammad Rasyid Ridho—to convey their opinion and perspective over the presentations’ results. Discussions in both sessions are centered on two main topics, namely International Regulation on Fisheries and International Blue Economy Practices, as well as Circularizing Blue Economy and Development in Indonesia Context. 

In contrast to circular economy workshops held by CWTS UGM in the previous years, this year’s International Workshop on Blue Economy produces a collaborative policy recommendation from each participant—both the presenters with their academic perspective and the public. The proposed policy recommendation had also covered the view of each stakeholder involved in each CEF event regarding the blue economy, which will be disseminated and advocated to relevant international and national stakeholders in 2024. This is to support what Mario Aden Bayu Valendo, the Head Committee of CEF 2023, had conveyed at his CEF brief report delivery at the beginning of the event. 

“Our aim is clear – to create a platform that upholds a multi-party dialogue. This dialogue involves not only the local communities but also the government, private sector, academia, and the international society. It is time to weave the fabric of our blue economy by integrating the voices and aspirations of those who reside closest to our oceans,” said Mario. 

Lukas Singarimbun, S.I.P, researcher from CWTS UGM, also stated in his opening remarks regarding the main purpose of the International Workshop on Blue Economy, which is to bridge the gap of comprehension and adoption found in blue economy’s practices. 

“Today, we aim to bridge that gap by enhancing understanding, both conceptually and practically, empowering communities to harness the sea's potential while prioritizing environmental sustainability,” said Lukas.

Andreas Sennekamp, Head of the Academic outreach and WTO Chairs Programme Section, also emphasized multi-stakeholder collaboration in blue economy practices to mitigate the impacts of climate change. Sennekamp also reiterated the importance of implementing rules based activities of the fisheries industry to mitigate the adverse impacts of illegal fishing. 

As the final event of CEF 2023, the International Workshop on Blue Economy is specifically dedicated to the late Director of CWTS UGM, Dr. Riza Noer Arfani, to honor his recent passing. Dr. Riza had devoted his energy and ideas to foster an inclusive sustainable trade development, primarily through mainstreaming the circular economy in Indonesia by involving local communities alongside various stakeholders. His passion created a path to the establishment of the Circular Economy Forum, which had its prototype event in 2021. 

In a moment of silence session, Lukas delivered the WTO Chairs Programme message regarding Dr. Riza. “Prof. Riza Arfani has been a part of the very first cohort of Chairs accepted to the Programme. The WTO Chairs Programme, the global scientific community, and Indonesia have benefited from his exceptional efforts and contributions, and the team in the Universitas Gadjah Mada has been an active part of the Programme for over a decade under his leadership. Please accept our condolences regarding your loss. Nothing can replace Prof. Arfani's presence at this event, and we will not forget how valuable his life was.” Additionally, Lukas also stated that CWTS UGM will always remain committed to his visions in producing and disseminating knowledge of the circular economy.

Saturday (4/11), CWTS UGM in collaboration with Suryakanta Institute and the Circular School Program Partnership (CSPP) held the Rantai Komang Trip (Beach Cleaning & Mangrove Conservation) activity together with a Yogyakarta environmental community, Garduaction (Garbage Care and Education). Held on the coast of Parangkusumo Beach, Yogyakarta, this activity was attended by more than 50 participants from various regions.

The Rantai Komang Trip commenced with opening remarks by Mr. Hindratna as the host of Garduaction. In his remarks, he expressed his gratitude and welcomed all Rantai Komang Trip participants. Mr. Hindratna then elaborated Garduaction's journey in managing waste on the Parangkusumo coast. Currently, Garduaction has produced several items from waste, ranging from lightweight bricks, paving blocks, children's toys, flower pots, to eco-enzymes. He also felt proud and honoured for the visit of the Rantai Komang Trip’s participants.

Afterwards, Mario Aden Bayu, the chief organizer of the 2023 Circular Economy Forum (CEF) explained briefly the technicalities of the Rantai Komang Trip event, including the output of this agenda which will be presented at the International Workshop, the next series of CEF 2023 activities.

Dr. Riza N. Arfani, Head of PSPD UGM, continued his remarks by appreciating Garduaction for warmly welcoming the Rantai Komang Trip participants. Dr. Riza explained that through this event, participants could learn first-hand about waste processing in the coastal area, as well as observe directly the processed waste products in Garduaction. He hopes that the enthusiasm of the participants in participating in this activity will continue in a series of other CEF activities until next December.

Eventually, the supervisor of the Suryakanta Institute and environmental activist, Major General TNI (Ret.) IGK Manila or well known as Opa Manila, stressed that the implementation of the circular economy and the blue economy are ways to protect the environment which is currently in a worrying condition. Humans are the main perpetrators of this condition by destroying the environment. Opa Manila hopes that this event will encourage more people to take part in raising awareness about the environment. 

The agenda continued with the formation of several groups who worked collectively to collect rubbish around the coast of Parangkusumo Beach. Simultaneously, participants also had "nyangkruk" or  casual dialogue with local residents to find out more about the lives of coastal residents. After completing these two activities, participants then sorted the collected waste based on several categories, which subsequently will be processed by the Garduaction team into valuable items. The agenda then continued with planting sea pandan mangroves in the area around Garduaction. 

The activity is closed with a bonfire while enjoying the beach atmosphere at night. In the midst of the warm atmosphere, the participants discussed and reflected on the series of Rantai Komang Trip activities..

The Center for World Trade Studies (CWTS) UGM and the Faculty of Social and Political Sciences (FISIPOL) UGM held an Interactive Talk Show with the theme "Empowering Circular Economy through Industry and Community Engagement" on Thursday (8/12). The Talk Show took place at the West Atrium of FISIPOL UGM and was attended by four speakers: Prof. Dr. Edia Rahayuningsih (Head of Indonesia Natural Dye Institute/INDI UGM), Sri Wahyaningsih, BSc (Founder of Sanggar Anak Alam), Ir. Setyo Hastuti, M.P (Secretary of the Department of Cooperatives and SMEs of Yogyakarta), and Boy Chandra (Chairman of Guwosari Training Center). The Talk Show is part of the Circular Economy Forum (CEF) within the UGM International Forum for Inclusive and Sustainable Development in Southeast Asia, Latin America, and the Caribbean Region.

Moderated by Josh Handani, Chairman of the Indonesian Circular Economy Consortium (KESI), the Talk Show began with a presentation by Prof. Dr. Edia Rahayuningsih regarding the role of INDI UGM in reviving the use of natural dyes as a manifestation of local wisdom and cultural heritage. As a country rich in resources, Indonesia is encouraged to have a spirit of production based on the principles of the circular economy. Prof. Edia emphasized that natural dyes are not just products but a movement that requires synergy and collaboration from various stakeholders.

From the government perspective, Ir. Setyo Hastuti, M.P. emphasized the importance of the penta helix collaboration between the government, businesses, media, communities, and society in developing environmentally sustainable SMEs. To promote the development of SMEs in the Special Region of Yogyakarta, the management reform of SMEs is emphasized to include formalization and digital transformation.

The presentation was continued by Sri Wahyaningsih, BSc, who explained the education system of Sanggar Anak Alam from kindergarten to high school. By providing freedom for students to explore areas of interest, Sanggar Anak Alam emphasizes a practice-based and research-based curriculum to foster entrepreneurial skills and awareness of environmental sustainability.

The Talk Show concluded with Boy Chandra from the Guwosari Training Center (GSTC) presentation on the crucial role of waste pickers as environmental observers and the application of zero waste management in establishing GSTC. GSTC focuses on household waste management training with the principle that the waste that comes in must go out as an end product. In 2020, GSTC implemented principles aligned with the circular economy by developing waste-to-block technology.

Center for World Trade Studies (CWTS) UGM and the Faculty of Social and Political Sciences (FISIPOL) UGM held an Interactive Talk Show with the theme "Connecting Schools with the Adoption of Circular Economy" on Wednesday (7/12). The Talk Show took place at the West Atrium of FISIPOL UGM and was attended by four speakers: Julie B. Appelqvist (Head of Environmental Sector Cooperation, Embassy of Denmark in Indonesia), Drs. Muthoin, M.Si (Head of Agency for Regional Development of Salatiga), Dr. Nurhadi, S.Sos, M.Si. (Lecturer at the Department of Social Development and Welfare, FISIPOL UGM), and Dr. Junita Widiati Arfani (Coordinator of IGPA). The Talk Show is part of the Circular Economy Forum (CEF) within the UGM International Forum for Inclusive and Sustainable Development in Southeast Asia, Latin America, and the Caribbean Region.

Moderated by Suci Lestari Yuana, MA, lecturer at the Department of International Relations, FISIPOL UGM, the Talk Show began with a presentation by Julie B. Appelqvist on the development of the circular economy in Copenhagen, Denmark. Julie shared several strategies for promoting the circular economy at the primary education level, such as giving students the title of "waste heroes," initiating the concept of waste-free schools and modifying the curriculum to focus on practical application. Implementing the circular economy in the education environment will also be supported by policies and collaboration from local governments.

Representing the Deputy Mayor of Salatiga, Drs. Muthoin, M. Si, the Head of the Agency for Regional Development of Salatiga, discussed Salatiga's efforts to address the impacts of the pandemic through community economic recovery and waste management. Several practices aligned with the circular economy can be found in farmers' utilization of food waste and washing water as liquid fertilizer for farmers in Salatiga. In addition, Salatiga plans to allocate local government budgets to support green schools and the establishment of waste banks in each neighborhood (RW).

From an academic perspective, Dr. Nurhadi, S.Sos, M.Si emphasized the important role of education in instilling a culture of the circular economy. Dr. Nurhadi highlighted three functions of universities in maximizing this role: the campaign function, the research and development function, and the advocacy function.

The Talk Show continued with a presentation by Dr. Junita regarding the objectives and activities of IGPA or the Indonesia Green Principal Award. As a program supporting elementary and secondary school principals, IGPA is designed to institutionalize the practices and principles of the circular economy among children from an early age. IGPA has been held since early 2022 with the collaboration among educational institutions, research bodies, and industries and has participated by 33 school principals in two training cycles.

The Talk Show concluded with the announcement of the release of a book written by participating school principals in IGPA titled "Rediscovering the Pearl of Sustainability" and the presentation of recognition certificates to several schools. The recognition certificates were divided into four categories. First, the Knowledge Co-Production category was awarded to Aisyiyah Unggulan Gemolong Elementary School and Muhammadiyah Ketanggungan Elementary School. Second, the Outreach Program category was awarded to Muhammadiyah Program Unggulan Khusus Kottabarat Surakarta Elementary School and Muhammadiyah 2 Alternatif Kota Magelang Elementary School. Third, the Curriculum Design/Adoption category was awarded to Muhammadiyah Sudagaran and MI Muhammadiyah Ajibarang. Fourth, the Partnership Building category was awarded to Muhammadiyah Plus Salatiga Elementary School.

Centre for World Trade Studies (CWTS) UGM and the Faculty of Social and Political Sciences (FISIPOL) UGM organized the Forum on Sustainable Development Policy, Circular Economy, and Industrial Transformation on Tuesday (6/12). As part of the UGM International Forum for Inclusive and Sustainable Development in Southeast Asia, Latin America, and the Caribbean Region, this forum aims to generate policy proposals on trade and industrial transformation based on the circular economy through multi-stakeholder dialogues. The forum participants at the UGM Central Building include WTO delegates, national and local governments, academicians, local communities, and businesses. 

The Policy Forum was opened by Dr. Wawan Mas'udi, Dean of FISIPOL UGM, and Dr. Riza Noer Arfani, Head of CWTS UGM. Dr. Wawan and Dr. Riza emphasized the importance of learning from the community as initiators of the circular economy in formulating policies. "There is no need for overly theoretical frameworks, but we can learn from grassroots initiatives," said Dr. Wawan. Together with Dr. Poppy Sulistyaning Winanti, Vice Dean for Academic and Student Affairs at FISIPOL UGM, Dr. Riza facilitated the first session of discussions, featuring presentations from Dr. Werner Zdouc (Director of the Knowledge and Information Management, Academic Outreach and WTO Chairs Programme Division of the WTO), H.E. Dandy Iswara (Deputy Permanent Representative of the Republic of Indonesia II in Geneva/Ambassador), Dr. M. Pramono Hadi, M.Sc. (Head of the Center for Environmental Studies at UGM), and Prof. Dr. Catur Sugiyanto, MA (Head of the Center for Economic Democracy Studies at UGM).

In his speech, Dr. Werner Zdouc underlined the importance of the circular economy in replacing the traditional economy that exploits resources and harms the environment. In the context of circular economy development in ASEAN, Latin America, and the Caribbean (SEA-LAC) countries, Dr. Werner mentioned the urgency of addressing several issues, such as the definition and classification of end-of-life products, conformity assessment procedures, licensing, trade-related issues, and capacity building related to trade. It is also essential for SEA-LAC governments to not only promote a circular economy among business stakeholders but also raise consumer awareness and engage civil society in sustainable consumption practices.

Continuing from Dr. Werner, H.E. Dandy Iswara highlighted Indonesia's interest in cooperating to implement COP26 and the Paris Agreement amidst significant population growth. Indonesia has several targets, including implementing the circular economy to reduce emissions and sustainable fisheries targets. H.E. Dandy also emphasized the need for national and international collaboration to achieve effective and equitable implementation of the circular economy for each country.

Representing the academic community, Dr. M. Pramono Hadi, M.Sc., highlighted the potential realization of the circular economy through increased forest role in carbon sequestration. Dr. Pramono identified five key sectors that need attention in low-carbon development planning: forestry, agriculture, energy and transportation, industry, and waste and garbage. Besides forests, the circular economy can also be applied in developing dairy farming businesses. Prof. Catur Sugiyanto, MA, stressed that institutional improvement, technology, and support are pivotal in developing micro, small, and medium-sized enterprises (MSMEs) that contribute to the circular economy.

The event continued with a policy formulation session, where representatives from regional authorities, communities, and companies exchanged ideas and shared their sector-specific policies and practices. Various interesting issues emerged, such as priorities between mindset change and profit-based approaches, characteristics and availability of space in each region, recycling monitoring and evaluation issues, challenges in committing to circular economy initiatives, and concrete strategies that can be implemented through cross-sector synergies.

The Policy Forum concluded with a presentation by Prof. Daniel C. Esty from Yale University. After appreciating the outcomes of the G20 Indonesia and placing hope in Indonesia's leadership in ASEAN in 2023 in his remarks, Prof. Daniel emphasized three crucial elements in implementing the circular economy in Indonesia. First, there is a need to improve and strengthen policy frameworks at the global, national, and sub-national levels. Second, there is a need for a shift in business norms, mindset, and facilitation in financial and trade aspects directed toward climate action. Lastly, a social movement from all segments of society and the government is necessary to drive the transition from a linear to a circular economy.

In the end, the Policy Forum agreed to accommodate the formulation of circular economy regulations that address various aspirations. Some of the conclusions reached include (1) the establishment of regulations that are not merely top-down and minimally supervised but accompanied by multi-sector alternatives; (2) increased research on intangible aspects such as lifestyle patterns; (3) the creation of a flowchart of circular economy solutions that maximize the elements of customs, religion, education, culture, law, and local economy. The agreement is expected to be material for the CWTS UGM policy roadshow in early 2023, initially focused on the KARTAMANTUL region (Yogyakarta City, Sleman Regency, and Bantul Regency).

Trade wars, naval skirmishes, and escalating rhetoric have been at the heart of China-U.S. relations for over a decade. As is well documented, China’s rise following the turn of the 21st century has made waves throughout the international political economy, raising questions about the compatibility of the competing economic strategies of the two great powers. Where the United States has remained adamant in its espousal of a liberal international order, China prefers the approach of State Capitalism which underpins its Belt and Road investment initiative. 

Concurrent with the conflict between China and the U.S. is the rising economic power of the BRICS nations, including Brazil and India. As a result of this success, more and more countries are finding benefits in cooperation with BRICS rather than working exclusively within the United States’ existing economic framework. Accordingly, the number of countries seeking to join BRICS continues to grow, including Argentina, Indonesia, Saudi Arabia, and the United Arab Emirates. Working with BRICS may see a further boost in popularity as the group continues to investigate the creation of a new global currency, which would allow participating nations to trade independently of the USD.

Against this backdrop of tussling powers in the Indo-Pacific is Australia’s evolving approach to foreign policy and international trade. A Western nation, Australia is often portrayed as an outsider among its Asian neighbours and as a satellite state of the United States. There is truth to this. Historically, Australia has displayed discomfort regarding its place within the region and is the only nation to have supported the U.S. in all of its major military campaigns. However, where Australia has leant heavily on the U.S. for support in defence and politics, the same cannot be said for its trade relations. Instead, it has been heavily dependent on China to grow its economy in the 21st century, primarily by exporting its natural resources. 

Despite the importance of maintaining relationships with China and the U.S., there is growing recognition in Australia that reliance on two competing great powers can only continue for a while. Tensions between Australia and China have already bubbled over in the past, resulting in in diplomatic spats and trade sanctions against Australia. Further, as China and the U.S. continue to butt heads over freedom of navigation and Taiwan, Australia risks becoming stuck between its defensive interests (U.S.-aligned) and economic interests (China-aligned) in the event of escalation. Such an outcome would be catastrophic for Australia, which risks economic devastation should its relationship with its closest trading partner deteriorate before appropriate diversification can be achieved. 

As uncertainty plagues the future of the Indo-Pacific, Australia has realised that it must develop its own identity in international trade and foreign policy. This realisation is reflected in the pursuit of economic diversification by Australian businesses and policymakers. Australian policymakers have clearly taken note of the growing economic success of ASEAN member states, including Indonesia and Vietnam, with the region becoming a more significant priority for policymakers. Evidence of this pivot is growing. Most recently, Australia became a member of the Regional Comprehensive Economic Partnership Agreement (RCEP) alongside 14 of its Indo-Pacific contemporaries, with Australia’s Department of Foreign Affairs and Trade (DFAT) citing the agreement as pivotal for facilitating access to “the fast-growing and dynamic Indo-Pacific region.” Additionally, IA-CEPA, a comprehensive bilateral free trade agreement between Australia and Indonesia, came into effect in 2020. The intention is clear – Australia recognises the importance of Indonesia and wants to build a closer economic relationship. 

Outside of diversifying trading partners, these agreements also pave the way for economic cooperation outside the mining exports for which Australia is so well known. Following the implementation of IA-CEPA, Australian companies have already begun exporting their services to Indonesia in education and healthcare. Such an example is Aspen Medical, an Australian healthcare company that has since agreed to a $US1 billion deal with West Java for the build of over 600 healthcare clinics. Australian companies are also diversifying the location of their manufacturing away from China, as part of a global trend, with many choosing Vietnam as their new country of operations. Australia’s clothing company Cotton On and its foremost natural health company, Blackmores, are leading examples of this transition in effect.

However, despite a growing recognition in Canberra of the opportunity, there remains work ahead to ready Australian companies and investors for doing business with new trading partners in ASEAN. As a result, expect to see a greater focus from the Australian government in facilitating access to new ASEAN markets for Australian companies and exports. The growing economic relationship between Australia and ASEAN members offers hope for the Indo-Pacific through increased cooperation and integration, which could ultimately culminate in greater prosperity and understanding for all. 

Mahasaraswati University Denpasar (UNMAS) Business Incubator (INBIS), Indonesian Young Entrepreneurs Association for Higher Education (HIPMI PT) UNMAS, and the Center for World Trade Studies at Gadjah Mada University (CWTS UGM) held the Sarasehan* Indonesian Economic Democracy (SARDEIN) on Friday (14/4). This SARDEIN session was held at Mahasaraswati University in Denpasar, Bali, with the theme "Projecting the Importance of Local MSMEs in National Economic Equality."

The event was opened with the welcoming dance "Sekar Jagat," followed by remarks from UNMAS and CWTS UGM representatives. Opening remarks by Vice Chancellor III UNMAS, I Komang Budiarta, S.Pd., M.Pd., M.Hum, expressed hope that the quality of MSMEs, especially in Denpasar, would improve as a result of the SARDEIN discussion. Dr. Riza Noer Arfani, Head of CWTS UGM, underlined the importance of collaboration between MSMEs, academics, and policymakers in encouraging the competitiveness of MSMEs in the international market. Representing the Suryakanta Institute, Maj. Gen. TNI (Purn.) IGK Manila, S.I.P. then welcomed the participants and assistants. Further, he motivated students to care more about the development of MSMEs.

Moderated by Putu Desi Anggerina Hikmaharyanti, M. Hum, the session continued with the Head of the Denpasar City Cooperatives and MSME Office, Dr. I Dewa Made Agung, SE., M.Sc  presenting examples of Denpasar City Government’s various MSME development practices. Some government efforts, including the creation of the KUBALI.com website to enhance MSME capital, an e-catalogue to increase MSME market access, a youth economic creativity festival “D'Youth Fest,” Denpasar Festival, and the MSME Actors Exhibition. Denpasar’s government also expects growth in cooperation for approaching MSME development problems, especially in promotion and marketing.

Head of the Buleleng Regency Tourism Village Network, Jero Mangku Made Ariawan, STT.PAR. MBA raised various circular economic activities in the Tourism Village of Buleleng Regency, Bali. Jero emphasized the importance of practical discussions and directions for farmers and MSME actors, who often do not specialize in a theoretical approach. By exploiting the potential of the location and culture, UMKM Tourism Villages in Buleleng Regency are advancing the arts, agriculture, and snack food sectors.

Continuing the discussion, the Head of INBIS UNMAS Denpasar, Daniel Manek, S.Fil., SM., MM, shared various experiences of MSME-themed competitions which students at UNMAS Denpasar attended to advance and develop student skills in the MSME field. Apart from the competition, Daniel also encourages skill development through collaboration like the one between UNMAS and CWTS UGM.

Furthermore, the Head of Section 1 of the Denpasar City HIPMI Branch Management Body (BPC), I Putu Hendra Arimbawa, SE., conveyed the great potential of Balinese MSME products and the relatively high potential of the MSME market in Indonesia. I Putu Hendra emphasized the importance of strengthening the MSME export-import sector to advance the Indonesian economy.

After the Question-and-Answer session, SARDEIN was closed by signing a Cooperation Agreement (PKS) between CWTS UGM and INBIS UNMAS on the local MSME empowerment program to create a sustainable, just, and resilient economy. This collaboration between CWTS UGM and universities in the n-helix scheme is oriented toward research, curriculum development, training, and policy advocacy.

* Sarasehan (in Bahasa) is a semi-formal discussion between experts and audiences on certain issues.

On Sunday (12/03), CWTS UGM collaborated with the Suryakanta Institute and Sumberharjo Green Tourism Exploration (JWHS) to deliver Volume 3 of the Sarasehan* Indonesian Economic Democracy (SARDEIN). This Sarasehan was held in Sumberharjo Village, Yogyakarta, with the theme "Vision of the Indonesian Circular Economy: Where is the Position of Villages and Local Communities?". Discussions were attended by local policy stakeholders of the Special Region of Yogyakarta (DIY), as well as practitioners and academics. Volume 3 of SARDEIN was also used to generate momentum for launching a book compiled by CWTS UGM and circular economic experts from various fields.

The SARDEIN workshop commenced with Klero Hamlet, Sriwidodo, welcoming the speakers and presenters to the Sumber Budhaya Building, which is said to hold historical significance for the people of Sumberharjo. Remarks were continued by the Head of CWTS UGM, Dr. Riza Noer Arfani, who identified the purpose of SARDEIN as a forum for discussion and knowledge dissemination, especially learning about circular economy practices at a local level context by involving various elements of society. During the event, Dr. Riza officially launched a book titled "Circular Economy in Universal Ideas and Local Practices" as CWTS UGM's contribution to developing a circular economy in 10 potential Indonesian sectors.

The Head of Sumberharjo Urban Village, Kurniawan Widiyanto, S.E, started discussions by highlighting that the village's 3R system (Reduce, Reuse, and Recycle) has not been maximally implemented. Kurniawan emphasized the importance of collaboration between the local government, university academics, the community, and local industry to campaign for circular economic practices at the sub-district and village levels, such as in Sumberharjo.

Director of the Independent Study and Administration Institute, Agus Hartono, S.S., discussed the problem of waste, which remains a long-term burden for Yogyakarta. Agus shared his belief that the government must maintain a firm approach toward managing waste with local communities and commercial industry. Agus further elaborated that companies should design products made from materials that are easy for consumers to process.

Ishadi Zayid, S.H., Head of the Sleman Regency Tourism Office, raised the environmental sustainability aspect of DIY’s provincial tourism sector as a topic for discussion. Ishadi expressed the commitment of the Sleman Tourism Office to developing community-based tourism that does not cause harm to the environment or conflict with the socio-cultural aspects of local communities. This commitment is manifested in the SAPTA PESONA campaign: Security, Orderly, Cleanliness, Coolness, Beauty, Friendliness, and Memories.

Representing the DIY Cooperatives and Small-Medium Enterprises (UKM) Office, the Head of the Cooperative and SME Entrepreneurship Services Division, Wisnu Harmawan, S.P., MT. said that 90% of DIY SMEs are still constrained in developing environmentally sustainable businesses due to a lack of financial support and guidance. Furthermore, based on European countries' rejection of DIY-based SME products, Wisnu conveyed the importance of pushing for environmental sustainability certification to expand these SME products into international markets.

SARDEIN Volume 3 was closed by Rizky Alif Alvian, MIR., CWTS UGM researcher and editor of the book "Circular Economy in Universal Ideas and Local Practices," which underlined the book's findings related to four circular economy trends visible in Indonesia. These trends include 1) circular economy practices driven from above (e.g., governments or international organizations); 2) practices driven from below (e.g., society and community); 3) potential production process improvement; 4) potential for policy making at the industrial level.

* Sarasehan (in Bahasa) is a semi-formal discussion between experts and audiences on certain issues.