Wednesday, January 6, 2010

Asean-China FTA Carries On

In spite of the requests for postponement made by industrialists, the Indonesian government will implement the Asean-China Free Trade Agreement (FTA) effective 1 January 2010.
Kompas quoted Trade Minister Mari Pangestu as saying that the FTA will boost export of agricultural products like Crude Palm Oil (CPO) and Cacao.

Trade Minister Mari Elka Pangestu KOMPAS/LUCKY FRANSISKA
JAKARTA, — The ASEAN-China Free Trade Agreement (FTA) applied since January 1, 2010, reaps controversy. The reason is that the agreement nullifies import duties for thousands of products feared to be threatening the national industry.

Even so, Trade Minister Mari Elka Pangestu underlines that the FTA may benefit Indonesia's export and investments.

"We had the FTA coming from a long while ago. Many sectors can benefit from it," she stated at the New Year press conference, Department of Trade office, Jakarta, Tuesday.

The minister stated that the export sector for main commodities, such as crude palm oil (CPO), cacao, and glass will have a boost due to the FTA. Furthermore, the minister is optimistic that the FTA can boost investments from China to Indonesia. "Our export to China will increase, such as for CPO and cacao."

The minister admits that some industrial sectors have objected the FTA. Therefore, the ministry has formed a special team to deal with the FTA.
Besides, the government has also notified all ASEAN countries and China regarding the objection. Hopefully, the FTA can be postponed for some sectors.

"The government is taking rapid responses and will continue to counter the emerging issues. Each sector has its own issues, so it must be studied first," she concluded.


murkcore@blogger blog said...

wow.. your blog posts are very informative, quite detailed.. I enjoyed reading about the stuffs happening there at your country..


H. Nizam said...


Thank you for the kind words.
I am glad that you enjoyed my blog.

Yari NK said...

I think it is wimpish to raise a hue and cry about the rejection of the free trade. Some say that we are not well prepared yet for free competition. But the question is, will we ever be ready to face it??

I realise that every commitment we take has both upsides and downsides. Life is no bed of roses. And sometimes we have to take the bitter pills to live on healthy body.

The best thing is not to steer clear of the pills. We take them, and see how they worked or how we must do to make them work. In this free trade case, I believe that we have to improve our human resources and to get rid of all illegal or underhand retributions (pungli)that unnecessarily burdens the cost of production, and that's only to start with...

H. Nizam said...


You are right that we should make ourselves ready for free trade.
But at present many of our industries are not ready, even before the FTA our market has been invaded by Chinese cheap products: toys, electronics, tiles, food and beverage, even batik. If our industries are forced they'll slowdown or even stop production, thus making many people unemployed. If that happen there will be many people who cannot eat, drink, pay school fees, rise in crime, etc.etc.
A postponement for 3 years, which is possible according to agreement,
will enable the industries to cut costs, be more efficient. And the government should also implement strict law enforcement especially to civil servants to prevent pungli etc.