Singapore and Indonesia announced several initiatives yesterday to deepen their relationship, including agreements to protect each other's investors and to shore up financial and monetary stability in the region.
At their annual retreat yesterday, Prime Minister Lee Hsien Loong and President Joko Widodo noted the mutual trust between the two countries, and said they could do more to benefit their peoples.
Amid volatile financial markets, Mr Joko announced a US$10 billion (S$13.8 billion) local currency swap and US dollar repurchase agreement between the two countries.
This will give both countries access to each other's currency and to US dollars. They can use this to settle trades or defend their currency in times of financial stress.
This reduces the uncertainty and risk that can stem from exchange rate fluctuations, in times of financial market turbulence.
"In the midst of this global economic uncertainty, economic cooperation was our focus," Mr Joko said, welcoming the deal between Bank Indonesia and the Monetary Authority of Singapore.
The leaders also witnessed the signing of a treaty which establishes rules on how each country should treat investments and investors from the other.
Singapore companies in Indonesia will enjoy protection and have access to international arbitration in the event of investment disputes, and vice versa.
Singapore is Indonesia's largest investor, with US$8.4 billion in realised investments last year. Both are among each other's top trading partners and sources of visitors, with two-way trade totalling $59.4 billion last year.
Several other agreements were signed between Singapore and Indonesia yesterday, including on financial technology cooperation and cultural cooperation.
PM Lee also announced a project to develop a new Rising fellowship programme. The term, conceived when both sides marked the 50th anniversary of diplomatic ties last year, is an amalgamation of "RI" for the Republic of Indonesia and "SING" for Singapore.
PM Lee said: "We hope every year to welcome more than a dozen leaders and officials, promising young people from Indonesia - not just Jakarta, but also the provinces and other cities - to come and visit us, to make friends, appreciate how we can work further together, what are the things which we can learn from each other."
Both leaders noted tourism cooperation has grown, with three new cruise itineraries expected to bring over 50,000 visitors to Bintan, Surabaya and North Bali by the end of this year. An agreement between Indonesian terminal operator Pelindo III and Genting's Star Cruises will encourage more cruises and facilitate the upgrading of Bali's Celukan Bawang port, and explore the upgrading of other ports like Tanjung Perak port in Surabaya, PM Lee said.
He noted that both countries' defence establishments are also working together on an intelligence-sharing facility.
"Our cooperation will continue during the next few months, and I am sure after the elections they will pick up strength again and will strengthen and grow further every year," PM Lee said, as he wished Mr Joko a smooth election next year.
