TEMPO.CO, Jakarta - Coordinating Minister for Economic Affairs Sofyan Djalil said that Iran has the potential to become one of Indonesia's export market. Sofyan predicted that Iran's economic condition will improve following the recent nuclear agreement signed between the country and P5+1 member countries (United States, United Kingdom, Germany, French, China, and Russia). "With the nulcear issue resolved, it could open [export] opportunities for Indonesia," Sofyan said on Wednesday, July 22, 2015.
Sofyan said that in the 2011-2012 period, Indonesia's export value to Iran had reached US$2 billion in total. However, the number decreases sharply in 2015 to US$400 million. Sofyan added that the government is currently attempting to revive its economic partnership with Iran. In the future, Sofyan said, Iran could be one of Indonesia’s main export destinations along with the United States, China, and Japan.
With Iran's nuclear issue resolved, the economic embargo enforced against the country will soon be lifted. Many predicted that following the termination of the embargo, Iran's oil will flood the global market, causing a decrease on global oil prices.
Sofyan asserted that increasing global oil supply caused by the lifting of the embargo will generate both positive and negative impact towards the Indonesian economy. The Minister said that increasing oil supply will lower prices and subsequently reduce fuel prices in Indonesia. "Fuel can get cheaper. The public will have less [financial] burden," Sofyan said.
However, on the other hand, lower prices will put pressure on Indonesian oil export, which could result in decreased state revenue.