Economic Cooperation between Indonesia and Cuba: An Analysis Using RCA-CMSA Product Classification and TINA Models

Indonesia and Cuba are two old friends and have cordial diplomatic relations, but their economic cooperation—particularly in trade and investment—remains below their potential. This study aims to identify the potential trade and investment opportunities. First, by using the RCA-CMSA Product Classification Model, the study suggested trade opportunities for Indonesia to export mining and manufactured goods, while Cuba exports manufactured goods and agricultural commodities. In the investment sphere, the findings suggest Indonesian outbound investment in Cuba including human blood antisera; ethyl alcohol; spirits and liqueurs; natural honey; and unwrought lead. Meanwhile Cuba is suggested to invest in transportation-related products, food products, textiles, essential oils and electrical appliances in Indonesia. Using the TINA model, the tariff dismantlement would boost Indonesia’s export products to Cuba including soap, palm oil, and food preparations. Meanwhile, Cuba would export products including cigarettes, cigars, cigarillos and cheroots, rum and other spirits. The findings suggest both countries should explore to establish Indonesia–Cuba Comprehensive Economic Partnership Agreement to expand bilateral economic cooperation, fostering Central Bank financial cooperation via Local Cooperation Settlement and Quick Response Code Indonesia Standard digital payment system complemented by encouraging socio-cultural, education and training, and research cooperation to enhance mutual understanding, and advancing South-South cooperation agenda. Last but not least, Indonesia could share best practices on Indonesian economic school of thought including ‘ekonomi kerakyatan’ (common people’s economy) and ‘berdikari (to stand on one’s own feet) in guiding economic processes in Cuba in accordance to the National Economic and Social Development Plan 2030.