Analysts welcome the government's new reforms<\/p>\n
JAKARTA (JP): Economic analysts and industrialists have
\nwelcomed the government's new deregulatory measures although many
\nof them doubt the effectiveness of the new move, intended to prod
\nthe development of domestic industries.<\/p>\n
\"I personally greeted the government's new reforms because it
\nreflects Indonesia's commitment to support the General Agreement
\non Tariffs and Trade (GATT) and the Asia Pacific Economic
\nCooperation (APEC),\" vice chairman of the Indonesian Economists
\nAssociation (ISEI), Dorodjatun Kuntjoro-Jakti, told reporters
\nhere last night.<\/p>\n
\"I should stress that deregulatory measures are a must for all
\ncountries to help face the era of the economic liberalization,\"
\nhe said.<\/p>\n
Meanwhile, ISEI's chairman Marzuki Usman noted that Indonesia
\nis now in a race with China, Vietnam and Bangladesh to gain
\nmarket shares in the era of liberalization.<\/p>\n
Rizal Ramli, managing director of an advisory group on
\neconomics, industry and trade, Econit, concurred that the new
\npolicy package is a positive step to foster economic efficiency.<\/p>\n
\"But it doesn't seem strong enough to anticipate the fierce
\ncompetition introduced by GATT,\" he argued.<\/p>\n
The government Monday introduced new measures which reduced
\nimport duties on 739 kinds of goods, removed non-tariff barriers
\non 27 products in the industrial, agricultural and health sectors
\nand the removed import surcharges from 108 other items. The
\nmeasures, however, raised import duties on 38 tariff codes for
\nalcoholic products.<\/p>\n
Automotive<\/p>\n
Chairman of the association of Indonesian automotive
\nmanufacturers, Herman Z. Latief, also greeted the newly
\nintroduced measures, saying that the move will prod the
\nefficiency of the domestic automotive industry.<\/p>\n
However, he cautioned that the new reduction of duties on
\nimports of assembled passenger cars will likely hit assembling
\ncompanies hard.<\/p>\n
Monday's measures allow a 25-percent reduction of duties on
\nassembled passenger cars and vans and another 10-percent cut in
\nduties on semi-trailer spare parts.<\/p>\n
\"The automotive industry will face serious difficulties,
\nconsidering that most of automotive workers are now involved in
\nassembling business,\" Latief said as quoted by Antara news agency
\nhere yesterday.<\/p>\n
He suggested that the reduction in import duties should have
\nbeen eligible both for assembled vehicles and components.<\/p>\n
With the new measures, imports of assembled cars whose models
\nhave been assembled in the country are subject to a 175 percent
\nduty, as compared to 200 percent previously and a surcharge of
\n100 percent.<\/p>\n
An economic observer, Hartojo Wignjowijoto, said that the
\nprerequisite of the success of the new measures is the
\ndevelopment of infrastructure in all provinces. \"Thus far, the
\nderegulation packages have not been effective in reducing
\nproduction costs because of ignorance of infrastructure
\ndevelopment,\" he said.<\/p>\n
A timber baron, Muhammad \"Bob\" Hasan, told Business Indonesia
\nthat the deregulation should be followed by an alleviation of
\nillegal levies and the streamlining of the licensing bureaucracy.
\n(fhp\/09)<\/p>",
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