US, Indonesia discuss boosting trade, Doha round

WASHINGTON, May 22 (Reuters) The United States and Indonesia agreed on Monday to work on boosting trade in agriculture, services and other key areas as part of an ongoing initiative that could one day lead to free trade talks.

''We also discussed how we could work together to advance ASEAN (Association of Southeast Asian Nations) integration and to help achieve a successful outcome to the ongoing WTO (World Trade Organization) Doha Round negotiations,'' U.S. Trade Representative Susan Schwab said in a statement.

Schwab and Indonesia's Minister of Trade Mari Pangestu met on Monday under the U.S.-Indonesia Trade and Investment Framework Agreement, a bilateral forum that could eventually lead to formal free trade negotiations.

They agreed to establish working groups to deepen economic ties in four key areas: intellectual property rights, which covers patents and copyrights; agricultural and industrial goods; services, and investment.

After a speech to a business group, Pangestu told reporters Indonesia was still interested in pursuing free trade talks with the United States when the time was right.

''Once you form these working groups, I think we begin to understand each other more,'' Pangestu said.

At the same time, it took the United States and South Korea five years to get to the point where they were ready to begin formal trade talks, Pangestu noted.

It's also uncertain whether Congress will renew the Bush administration's ''trade promotion authority'' to negotiate free trade deals when it expires at the end of June.

Pangestu told the U.S. Chamber of Commerce it was hard to predict whether efforts to reach a deal this year in the Doha round of world trade talks would be successful.

Much depends on whether the G4 -- which includes the United States, the European Union, India and Brazil -- can reach a breakthrough in the coming month, she said.

''I think a lot of the breakthrough is expected of the U.S.,'' Pangestu said, referring to pressure on the United States in the talks to make deeper farm subsidy cuts while scaling back its market access demands.

Pangestu also expressed concern the Doha round, which began in November 2001, could be delayed until after the 2008 U.S.

presidential election if there is no deal this year.

REUTERS KK PM0612