Political Relations

Historically, Egypt was the first leading country that recognized, on 18 November 1946, the proclaimed independence of the Republic of Indonesia. On 10 June 1947, the diplomatic relation between the two countries was officially established by the signing of the Treaty of Friendship and Cordiality, and followed by the opening of the Indonesian mission in Cairo in 1949.

Since the establishment of the diplomatic relation, the two countries have been maintaining traditionally close and fiendly relations. These cordial relations are reflected, inter alia, by intensified exchange of official visits, shared views on various international as well as regional issues of common concern, and coordination as well as mutual support in the international fora between the two countries.

On the issue of official visits exchange, all Indonesian Presidents, except B.J. Habibie, have ever paid either state or working visits to Egypt. Additionally, during 2009 alone, there were several visits paid by the Indonesian high level officials to Egypt, including by H.E. Mahfud M.D. (Chairman of the Supreme Constitutional Court), H.E. Sofyan Djalil (Minister for State-Owned Enterprises/Special Envoy of the Indonesian President), H.E. Abu Rizal Bakrie (Coordinating Minister for People's Welfare), Mr. Bambang Setiadi (Head of the National Standardization Agency), H.E. N. Hassan Wirajuda (Minister for Foreign Affairs), H.E. Alwi Shihab (Special Envoy of the Indonesian President for Cooperation with the Middle East Countries), and H.E. Bambang Sutantono (Vice-Minister of Transportation/Deputy Minister for Infrastructure and Regional Development Coordination, Coordinating Ministry for Economic Affairs).

On the other side, the last visit of the Egyptian President to Indonesia was paid by H.E. President Hosni Mubarak in 1983. At the high official level, H.E. Aboul Gheit, Minister of Foreign Affairs, has visited Indonesia in April 2005, for attending the Asian-African Summit and the Golden Jubilee commemoration of the Asian-African Conference 1955 in Jakarta and Bandung. Another high level visit was paid by H.E. Faiza Aboul Naga, Minister of International Cooperation, to Bali in May 2006, for attending the D-8 Summit, as well as to Jakarta in 2007, for attending the 5^th Egyptian-Indonesian Joint Commission Meeting. Meanwhile, the only visit of the Egyptian official to Indonesia during 2009 was paid in June by H.E. Ambassador Mohamed el-Zorkany, Assistant Foreign Minister for Asian, Australian, New Zealand, and Pacific Islands Affairs, as part of his tour to several Asian countries.

In order to strengthen and consolidate relations in various fields, both countries have established a mechanism of Bilateral Consultation at the senior official level between their respective ministries of foreign affairs. Since its inception in 2001, by the signing of the Memorandum of Understanding on Bilateral Consultation, the two countries have conducted four rounds of Bilateral Consultation meetings alternately in Indonesia (in Bali, 19–20 July 2004 and in Jakarta, 14 August 2006) and Egypt (in Cairo, 9–10 May 2005 and 29 October 2008). This mechanism provides an opportunity for both sides to discuss a wide range of bilateral issues as well as to exchange views on various regional and international issues of common concern, towards furthering and enhancing cooperation between the two countries.

Pertaining to the peace process in the Middle East, Indonesia shares a basic view with Egypt on the necessity of resolving the Arab-Israeli conflict, on all its three tracks (Palestine-Israel, Lebanon-Israel and Syria-Israel), in accordance with the UN relevant resolutions and agreements previously reached by the parties to the conflict. In this regard, Indonesia supports the stance demanding Israeli withdrawal from all Arab lands it has been occupying since 1967. With regard to Egypt’s regional role, Indonesia recognizes its pivotal and strategic role in advancing the peace process, particularly on the Palestinian-Israeli track, given inter alia the fact that Egypt is bordering a part of the Palestinian territories in the Gaza Strip. Indonesia also supports the Egyptian efforts to help the Palestinian causes, including those to mediate Palestinian political factions to achieve national reconciliation and unity, as well as those to revive peace talks towards a final and just solution to the Palestinian-Israeli conflict. Finally, Indonesia is committed to playing an active role and making contribution complementary to the international as well as regional efforts, including by Egypt, to promote the peace process in the Middle East.

Economic, Investment and Trade

Indonesia and Egypt have signed a number of agreements on the economic field, the agreements are including Agreement between the Government of the Republic of Indonesia and the Government of the United Arab Republic for Air Services between and beyond their respective territories (11 August 1964), Agreement on the Promotion and Protection of Investment (19 January 1994), Trade Agreement (23 June 1997), Agreement on the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income (13 May 1998), Memorandum of Understanding (MoU) between Central Bank of Egypt and Bank Indonesia (14 May 1998), MoU on Small and Medium Enterprises Cooperation (17 June 2000), MoU on Development of Syari'ah Financing Schemes for Small and Medium Enterprises in Indonesia (10 August 2004), and MoU on Veterinary Services and Quarantine Cooperation (18 June 2005).

To bolster the cooperation, both counties engaged in a Joint Commission Forum in the ministerial level, which the last meeting (fifth meeting) was held in Jakarta on 3-4 April 2007. On the meeting, both countries signed an umbrella agreement which called “Agreement between the Government of the Republic of Indonesia and the Government of the Arab Republic of Egypt on Economic and Technical Cooperation.” Following the signing of the agreement, both countries signed three memorandums of Understandings:

1.      Memorandum of Understanding between the National Standardization Agency of the Republic of Indonesia and the Egyptian Organization for Standardization and Quality of the Arab Republic of Egypt on Standardization Cooperation.

2.      Memorandum of Understanding Between the National Agency for Export Development (NAFED) of the Republic of Indonesia and the General Organization for International Exhibition and Fairs (GOIEF) of the Arab Republic of Egypt on Cooperation in Exhibitions and Fairs.

3.      Memorandum of Understanding Between the Batam Industrial Development Authority (BIDA) of the Republic of Indonesia and the General Authority for Investment and Free Zones (GAFI) of the Arab Republic of Egypt on Free Zone Cooperation.

In the past two years, economic cooperation between Indonesia and Egypt is developing significantly. in term of investment, Indonesia dominated the scene by making high value investment in Egypt, such as the investment made by Indorama in textile sector with its investment mounted to USD 30.72 million in 2007, Kedaung Industrial Group which invested USD 100 million in 2008 with its glassware manufacturing industry under the title “Pyramid Glass” which is located in the industrial area of Borg el-Arab, Alexandria, and the investment in food product with the establishment of Indomie factory in Badr City in 2009.

In the area of technical cooperation, Indonesia and Egypt continue to offer and make use of each country special programs: Indonesia in the area of micro finance and agricultural trainings, whilst Egypt in agriculture, fisheries and farming. Additionally, both countries frequently share their expertise and best practices through various interactions made by their officials’ visit. In terms of offshore employment, a number of Indonesian professional individuals are currently working in Egypt in various fields mainly in the oil sector, tourism and industry. Aside of the above mentioned cooperation; economic cooperation between Indonesia and Egypt is conducted not only in bilateral means of cooperation, but also in regional and multilateral framework such as the WTO, G-15, D-8, AMED and OIC.

This positive trend of cooperation is also reflected in the area of trade. In the last couple of years, the trend of trade between Indonesia and Egypt is showing a constant increase. The total trade value between the two countries in 2008 is significantly increased if compared to the trade value in 2003. The increase stood at 500% with 464% Indonesian export raise, and 682% Egypt Export raise.

Indonesia-Egypt Trade Balance 2003-2008

(Value: thousand USD)

Source: BPS

Traditionally, Indonesian products which penetrate Egypt market are fiber and yarn, paper products, plywood, coffee, soap, wear clothes, furniture, chemical fertilizer, cotton, sugar cane molasses, and rubber products like tires. While the main Egyptian products imported from Indonesia are phosphate, cotton, sugar cane molasses, fertilizer chemicals, palm and fruits, carpet and textile products and cotton yarn. In the past two years, to boost trade between the two countries, Indonesia has managed to diversify its marketed products in Egypt. Now Indonesian export products to Egypt include alloy wheel, car battery, office furniture, wooden & rattan furniture (indoor & outdoor), paper products, toilet tissue paper, baby care product, skincare, beauty soap, shampoo, tooth paste, herbal cosmetics, food stuff, glassware, plastic ware, salt and handicraft.

With the immense increase of the trade volume between the two countries, Egypt has become one of Indonesia’s largest non-traditional trading partners. This is evident from the total trade volume between the two countries in 2008 which has reached USD 1.1 billion, exceeding the targeted USD 1 billion trade volume of 2010 as aimed by the fifth Indonesia-Egypt joint commission meeting in 2007. It is also envisaged by the large number of transaction figure made by Indonesian and Egyptian businessmen at the 2008 and 2009 Trade Expo Indonesia (TEI). The figure which stood at USD 28.47 million on 2008 and USD 24.4 million on 2009 turned Egypt as Indonesia’s biggest trading partner on the both TEI.

Economic cooperation opportunities between Indonesia and Egypt are enormous, especially in the area of trade and investment. This opportunity is due to a number of factors:

1.      Geo-strategic position of Egypt with the existence of the Suez Canal which connects Asia, Africa, and Europe.

2.      Population of almost 83 million (the largest in the Middle East and second in Africa) and per capita income around USD 5,800 (based on purchasing power parity – PPP).

3.      High economic growth: 7.1 % (2006-2007), 7.5 % (2007-2008) and even on times of crisis (2008-2009) Egypt successfully reached a 4.5% growth. This eventually boosts the purchasing power of Egyptians and also gives rise to a huge middle class in Egypt.

4.      Egypt as a gateway of trade to the surrounding regions: Europe, Africa, Middle East or even the United States. This is possible because Egypt participated in various free trade agreements, to name a few:

·         COMESA (Common Market for Eastern and Southern Africa Agreement);

·         Agadir Agreement;

·         Greater Arab Free Trade Area;

·         Pan Arab Free Trade Area;

·         FTA with Turkey;

·         EFTA (FTA with Iceland, Lichtenstein, Norway and Switzerland);

·         Egypt – EU Partnership;

·         Qualifying Industrial Zone with the USA (Egyptian products have access to the USA without custom duty as long as it contains 11.7% of Israeli materials)

Social, Cultural and Education

Social and cultural relations between Indonesia and Egypt have been established since the mid-19th century, where dozens of students from Indonesia known as Ruwaq Jawi went to study at the Al Azhar University. Egypt’s Al-Azhar is still the major university for Indonesian students who want to deepen their knowledge about Islam.

In the effort of enhancing social, cultural and education field of cooperation, Indonesia and Egypt have established a number of agreements that form as the foundation for the cooperation. Some of the agreements include:

·         Cultural Cooperation Agreement between Indonesia and Egypt which was signed on October 10, 1955;

·         Protocol on information cooperation between the Indonesian government and the Egyptian government which was signed on October 19, 1972;

·         Agreement Between LKBN-MENA, signed in Cairo on October 12, 1977;

·         Joint Communiqué between the Indonesian Journalists Association, Indonesian journalistic organizations in 1983;

·         MoU in tourism sector signed on January 19, 1984;

·         Protocol of Information cooperation between the Department of Information of the Republic of Indonesia and the Ministry of State for Information of Egypt signed in Cairo on May 18, 1984;

·         Protocol cooperation on religion and waqf, signed on 11 May 1992;

·         MoU on Youth and Sports, signed on 18 September 1994;

·         MoU on Science and Technology, signed on 7 September 1995;

·         Agreement on science and education between Department of Religious Affairs of Indonesia and al-Azhar, signed on January 19, 1996;

·         Agreement on the establishment of al-Azhar elementary and junior high school in Jakarta, signed on September 28, 1999;

·         Protocol on Information cooperation, signed on March 19, 2003 in Cairo;

·         MoU between various Egyptian and Indonesian universities.

Indonesia is active in conducting various cultural activities in Egypt to promote better understanding between peoples of the two countries. In 2009 alone, The Indonesian Embassy in Cairo participated in several international events such as 6^th international cultural day on 6 October University in March 2009, "Ramadhan Lifestyle in Indonesia" on September 6, 2009 in Cairo Opera House and the Egypt’s national Children's Day at the Suzanne Mubarak Library on 22 November 2009.

One of the main cultural programs to promote better understanding between people of the two countries is Indonesian language course which is administered by the Indonesian Cultural and Information Center in Cairo. This course was reopened for the general public since 3 August 2008. Through such program, people of the two countries have the avenue to strengthen understanding of the two cultures. Currently there are 120 students learning Indonesian language at the center. This number increased from the initial figure on 2008 which only consist of 16 students.

Meanwhile, to promote youth cooperation, an Indonesia-Egypt Youth Exchange was held in 2007. A total of 24 Egyptian, consisting of 20 students, 2 travel writers (Al Ahram Al Araby and the Gazette), and 2 companion of the National Council for Youth made a visit to Indonesia in August 2007.

Other cooperation is in the form of journalist visit program. In 2005, the Indonesian Embassy in Cairo sponsored two Egyptian journalists: Mr. Sayed Hany (Al Gomhouria journalist) and Mr. Mounir El Fishawy (Islamic Tourism magazine journalist) for a program called "Fam Trip" which held by the Ministry of Culture and Tourism of the Republic of Indonesia. A similar program entitled Presidential Friends of Indonesia was also conducted in Jakarta on August 2009 which participated by Al-Ahram journalist, Mr. Mohamed Osman.

In an effort to bolster it public diplomacy, Indonesia has also actively participated in various international events held in Egypt, including Cairo International Film Festival, various TV and radio shows and other events organized by various cultural centers in Egypt.

In the field of education, Indonesia and Egypt continues to intensify the cooperation between Indonesian and Egyptian universities. As a showcase of such cooperation, Al-Azhar University provides 115 scholarships for Indonesian students each year with the details: 90 scholarships for bachelor degree, 20 scholarships for graduate programs and 5 pre-college scholarships. Egyptian government also provides 5 scholarships of Non-Al-Azhar for Economic Studies, Law and Arabic. In addition, Minia University provided scholarships for 10 Indonesian University students to attend an Arabic study for 1 year.

Highest Council of Religion Affairs of the Ministry of Waqf in Egypt provides scholarships for 100 Indonesian Students who study at Al Azhar University. Al-Azhar University also assigns teachers to madrasahs and pesantren in Indonesia, as many as 50 people are assigned in various Islamic Institutions all over Indonesia. Al Azhar also provides training opportunities for Indonesian Dai with Imam and Muballigh from various countries for 3 months.

In the years 2007-2008 four Egyptian students received Darmasiswa Scholarship from Indonesia. They are given the opportunity to learn about Indonesian arts, music and traditional crafts from several universities in Indonesia.

In addition to scholarships, there are also “Arabic in Country Program”, exchange of professors, students, Joint Research, Sandwich program and cooperation in the double-degree program between some universities in both Indonesia and Egypt.

The good education cooperation between Indonesia and Egypt is evident in the number of Indonesian students studying in Al-Azhar University which totaled around 5000 students.