Conflicting interest behind car row<\/p>\n
By Makmur Keliat<\/p>\n
JAKARTA (JP): After months of silence, Indonesia's ambitious
\nnational car program has become a contentious issue again.<\/p>\n
The Indonesian government has issued a statement saying it is
\ndissatisfied with Japan's unsympathetic filing of a complaint to
\nthe WTO.<\/p>\n
Indonesia also implied Japan was merciless and selfish because
\nit helped Japan solve its oil crisis in the 1970's.<\/p>\n
Is it right to say that Japan is self-seeking? The answer is
\ninconclusive and depends on your point of view.<\/p>\n
If international relations were shaped by moral law, Japan's
\nstance would be regarded as merciless and unsympathetic.<\/p>\n
But the above assumption has two main shortcomings.<\/p>\n
First, it is based on flimsy evidence if seen from a political
\nrealism viewpoint. In fact international relations are basically
\ndriven not by good offices but power struggles. Accordingly there
\nis nothing wrong if every country is selfish.<\/p>\n
The reason is very simple.<\/p>\n
An elementary lesson one could pick up from the history of
\ninternational relations is that it is marked neither by perpetual
\nfriends nor by eternal enemies but by the survival of the
\nfittest. With this in mind it sounds bizarre and ridiculous to
\nsay Japan is uncompassionate and merciless.<\/p>\n
It is also very naive to think that because Indonesia has done
\ngood things for Japan then Japan is morally obliged to return the
\nfavor.<\/p>\n
The second paucity of the above assumption relates to
\nempirical findings on trade disputes in international relations.
\nIn fact filing a complaint has become the norm in trade
\ndiplomacy.<\/p>\n
Historical evidence shows that contrary to popular belief
\ncountries generally do not feel insulted if complaints are filed
\nagainst them for GATT trade dispute resolution.<\/p>\n
For instance, in 1950, at the fifth session of GATT, the
\nNetherlands complained that British domestic tax was being
\napplied unequally on foreign and domestic products in violation
\nof GATT article III.<\/p>\n
The Netherlands lodged the complaint after a series of
\nbilateral discussions with the United Kingdom did not resolve the
\nissue. Several other governments supported the complaint.<\/p>\n
The British response is worth mentioning.<\/p>\n
It admitted the Dutch charges were correct and promised to
\ntake action as soon as possible. And when the sixth session was
\nheld, and the British had not yet been able to take action, a
\nspecial delegation led by Sir Hartley Shawcross the then British
\nminister for trade affairs was sent to Geneva to explain. He
\nsaid a major revision of tax laws was required and more time was
\nneeded.<\/p>\n
The law was corrected by the seventh session.<\/p>\n
Also at the sixth GATT session were two other complaints. One
\nwas filed by the United States on French export restrictions on
\nhides and the second was a Belgian complaint about quantitative
\nrestrictions imposed by France and the United Kingdom.<\/p>\n
The most interesting aspect of these two cases is that
\nbilateral discussions on the issues had never been held and the
\nlitigant countries simply filed their complaints at the session.<\/p>\n
But the charged countries were not insulted and both cases
\nwere settled bilaterally during the session.<\/p>\n
It is true that history can not offer a sound model to
\nunderstand and explain the current situation.<\/p>\n
But it can offer us invaluable lessons and evidence that the
\nfiling of complaints and the gracious reactions within the GATT
\nmechanism are a sign of the general acceptance of dispute
\nresolution procedures, rather than humiliation.<\/p>\n
In the light of this Japan's complaint is sensible, not
\nfrivolous, due to the very fact that Indonesia has imposed
\ndiscriminatory practices against Japan.<\/p>\n
By contrast Indonesia's recent statement seems an unusual and
\nan exaggerated response, particularly given international trade
\ndiplomacy practices.<\/p>\n
If this is the case the question we should ask is why has
\nIndonesia overreacted and why is it so sensitive? Can you argue
\nthat it is because the national car program is an integral part
\nof Indonesia's primary national interests?<\/p>\n
For academics who put their faith in the concept of the
\nnational interest, the answer is certainly yes. They might even
\npredict that Japanese assertiveness would be self-defeating in
\nthe long term because Indonesia might retaliate.<\/p>\n
For these academics the answer is clear. To avoid retaliation
\nand to protecting Japanese interests, both economic and security
\n-- Indonesia's strategic position is of great importance for
\nJapanese oil tankers sailing to and from the Middle East -- its
\nbest option would be to support Indonesia's national car program.<\/p>\n
But the existing situation is not that simple if one believes
\nin public choice.<\/p>\n
If one takes this line of thinking then the answer is no doubt
\nno, since others believe the term national interest describes a
\nnebulous concept touted by politicians and bureaucrats to hide
\ntheir personal interest.<\/p>\n
In other words, this view negates the idea of equating
\nnational interest with public policy.<\/p>\n
As a result the trade dispute between Japan and Indonesia
\nabout the national car program should not be interpreted as an
\nindication of Indonesia's economic nationalism.<\/p>\n
It merely shows conflicting interest between a small segment
\nof the Indonesian elite circle with the Japanese business
\ncommunity.<\/p>\n
Retaliation, therefore, would not automatically be a panacea
\nbecause a cost-benefit analysis is needed to determine this.
\nRetaliation could be counter-productive simply because political
\nrealism means \"If you have no teeth, you should not eat meat,\"<\/p>\n
The writer is a lecturer at the Faculty of Social and
\nPolitical Sciences, Airlangga University, Surabaya.<\/p>",
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