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Indonesia Case Study

Indonesia Case Study. ROO and TBT. Indonesia Trade. Exports 2004 : US$ 71 bn 2005 (Q1-Q3):62 bn 70 percent of exports is non-oil and gas Imports 2004 : US$ 44 bn 2005 (Q1-Q3):US$43 bn Mainly raw materials and intermediate inputs. Leading Exports (value and growth p.a. 2000-2004).

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Indonesia Case Study

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  1. Indonesia Case Study ROO and TBT

  2. Indonesia Trade • Exports • 2004 : US$ 71 bn • 2005 (Q1-Q3):62 bn • 70 percent of exports is non-oil and gas • Imports • 2004 : US$ 44 bn • 2005 (Q1-Q3):US$43 bn • Mainly raw materials and intermediate inputs

  3. Leading Exports (value and growth p.a. 2000-2004)

  4. Leading Export Commodities (value and growth)

  5. Exports to ASEAN

  6. NTMs in Export Market • EU Market

  7. NTM in Export Market • Japan market

  8. United States

  9. China

  10. Industrial Survey says… • The most affected commodities/sectors • Agriculture,food products, fishery and forestry (including wood products) (SPS mainly) • The most constraining NTMs in • EU

  11. Leather and Footwear in Japan • Introduced the tariff quota system for leather footwear in 1986. • The quantity of quota is automatically calculated under the publicized formula. Those who import leather and leather shoes less than actual allocation are penalized in calculating the quantity. • The quota allocation is also based on a company’s past experience in leather imports. As the result, trading firms that have long been in the business are given preferential treatment over the new entrants.

  12. Textile and Apparels: Japan • Authorization • Sole importing agency • Tariff quota • Technical regulations: such as labeling and rule of origin. • Variable charges • Never applied quota since 1995

  13. Harmonization of Standars • The survey says… • Standards differ across countries • EU, US and Japan are the highest • Within ASEAN also varies, with Singapore considered the highest standards • Countries seems to use standards to block imports • Indonesia does not apply compulsory standards in many cases • Firms considered that Indonesia standard authorities do not have adequate capacities to implement the standards • De facto, Indonesian standards is easier to fulfil by companies • Indonesia is considered non transparent (rule and regulation) • Irregular payments take place for accelerate process to get certificate

  14. Labeling procedure on all textile products governed under the Household Goods Quality Labeling Law includes the fiber composition and the maker's name. In addition, labeling on the shrinkage potential, fire incombustibility, washing and other care instructions, size and moisture resistance of the product is also required on manufactured textile products. Japan also applied Rule of Origin measures for textile and textile products.

  15. Machinery and mechanical appliances andelectrical equipment, • Labeling and Commodity Standard: • Special Electrical Appliances for 112 item of electrical appliances and material which are harmful, with two testing: • prepare and store testing record (article 8) • Labeling requirement (article 10). • Quota to ensure national security

  16. ROO

  17. Indonesia ROO • Generalized System of Preferences (GSP); • Global System of Trade Preferences (GSTP); . • Common Effective Preferential Tariff-ASEAN Free Trade Area (CEPT-AF TA); • ASEAN - China Free Trade Area (ACFTA); dan • Preferensi kerajinan tangan (handicraft)

  18. THE ASEAN CEPT ROO • Designated authorities to grant COO • Dinas (Local office of Ministry of Trade (Province, Municipals/City)) • PT. (Persero) Kawasan Berikat Nusantara dan Unit Usaha di Jakarta; • Badan Pengusahaan Kawasan Perdagangan Bebas dan Pelabuhan Bebas Sabang (BPKS); • Otorita Pengembangan Daerah Industri (OPDI) Pulau Batam; • Lembaga Tembakau Cabang Surakarta dan Medan, Balai Pengujian dan Sertifikasi Mutu Barang (BPSMB) dan Lembaga Tembakau Surabaya dan Jember.

  19. ASEAN ROO • Indonesia: CEPT vs MFN

  20. THE ASEAN CEPT ROO • Utilization Rate of CEPT = less than 2 percent of total exports (case of Jakarta’s exports)

  21. The Industrial Survey says • Many companies do not source its inputs from ASEAN -> so many are not eligible for ASEAN CEPT for imports • The ones which do source from ASEAN always ask the exporters to use CEPT FORM D • The one which export to ASEAN face no difficulties in filling FORM D as they have been doing it for several years • However, some face the problems in the beginning • Small Enterprise: • Main export commodities are furniture, leather goods,handicrafts and garments (embroidery). • usually pull their products to one exporter • also face no problems in exporting using Form D (as most of the input is local). • Home industries exports, most of the time, not using Form D as it is exported as hand-carry items

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