Wed, 17 Dec 2008
From: The Jakarta Post
By Mustaqim Adamrah, The Jakarta Post, Jakarta
New Zealand's proposal for Indonesia to scrap tariffs on imported meat and dairy products will not benefit the development of Indonesia's dairy and meat industries, Agriculture Minister Anton Apriyantono says.

"If that's the case (about what New Zealand has offered), it is too few, too little," Anton told The Jakarta Post via text message Tuesday.

He was responding to New Zealand's proposal to offer Indonesia doctoral scholarships, a small amount of financial assistance and a limited labor quota in exchange for Indonesia lifting all tariffs on imports of meat and dairy products.

New Zealand offered the financial assistance to train Indonesians working in the dairy and beef industries, including veterinarians, for a three-year period.

Anton said he would brush up on the details of the proposal currently being negotiated by the two countries.

The Trade Ministry is leading negotiations, with the Foreign Ministry acting as facilitator.

The two ministries might want to consult the advice of the nation's experts on the bovine industry, namely the Agriculture Ministry and other related ministries and agencies.

The negotiation is part of an auxiliary deal under the planned free trade agreement (FTA) between ASEAN and Australia and New Zealand, agreed upon on Aug. 28, which is expected to be ratified by all parties before the end of the year.

Australia, which some analysts believe has a hidden agenda in the trade deal, has put forward similar proposals, but details remain sketchy.

Beef and dairy products are currently subject to import tariffs of 5 percent on average.

Analysts say that eliminating the duty could bankrupt local dairy and meat producers, as the bovine industry is still developing.

The Agriculture Ministry estimates that 20,000 workers are directly employed in the country's dairy and meat industries.

Australia and New Zealand are the largest sellers of meat and dairy products to Indonesia.

With a population of 230 million people, Indonesia has been a key target for global meat and dairy producers.

Brazil has declared its intention to compete for a larger share of Indonesia's import market.

Sources at the Agriculture Ministry said the governments and top meat suppliers of Australia, New Zealand and Brazil were engaged in a fierce battle to become Indonesia's biggest importer of the products.

No matter which country takes the lion's share, Indonesia's meat and dairy producers are sure to suffer.

New Zealand recently dismissed speculation it had withdrawn from the negotiation table following Indonesian dissatisfaction with its trade proposal.

"New Zealand is not pulling out of the FTA," the country's deputy ambassador to Indonesia Chris Langley told the Post.

Trade analysts have criticized the negotiators for a lack of transparency, citing that Indonesian officials have never publicly disclosed potential gains or losses.

They said the future of Indonesia's meat and dairy industries was at risk and that such an important matter should not be decided by only a handful of officials at the Trade Ministry and Foreign Ministry and without public consultation or the involvement of legislators.



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