FTA to benefit RI more than China: Official<\/p>\n
Adianto P. Simamora, The Jakarta Post, Jakarta<\/p>\n
The government is confident that the newly established free
\ntrade agreement (FTA) between China and ASEAN countries will
\nbenefit Indonesia more than China as it would enable the country
\nto boost its exports, especially agricultural and fish products,
\nin the Chinese market.<\/p>\n
Budi Darmadi, the director of regional cooperation at the
\nMinistry of Industry and Trade, predicted that the country could
\nraise some US$110 million in revenue from the export of
\nagricultural and fish products to China next year when the
\nagreement is scheduled to come into effect.<\/p>\n
"We are confident that our products will be able to compete in
\nChinese markets, especially fish products. We are very strong in
\nthe fisheries sector," Budi told The Jakarta Post over the
\nweekend.<\/p>\n
"The agreement will give us (Indonesia) chances to export more
\nproducts to China in the future," he added.<\/p>\n
Budi added that the country's total imports from China might
\nonly reach some $80 million a year during the first years of the
\nagreement's implementation.<\/p>\n
China and Southeast Asian governments signed last Monday an
\nhistoric agreement to create the world's largest FTA, embracing
\n1.7 billion people and trade worth $1.2 trillion.<\/p>\n
Under the agreement, both parties, China and ASEAN countries,
\nagreed to first carry out an "early harvest package" over three
\nyears.<\/p>\n
During this period, each country will also start cutting
\nimport tariffs on selected products to between zero percent and
\nfive percent.<\/p>\n
The products covered under the early harvest package include
\nlive animals, meat, fish, dairy products, other animal products,
\nlive trees, vegetables, fruit and nuts.<\/p>\n
The FTA is expected to be complete in 2010 between China and
\nthe six original ASEAN members of Indonesia, Brunei, Malaysia,
\nthe Philippines, Singapore and Thailand.<\/p>\n
Meanwhile, for the less developed ASEAN nations of Cambodia,
\nLaos, Myanmar and Vietnam, the completion of the FTA was pushed
\nback until 2015.<\/p>\n
China's exports to Indonesia are so far mainly machinery and
\nequipment, electrical appliances and electronic devices, textiles
\nand motorcycles.<\/p>\n
Meanwhile, Indonesia's exports to China are mainly crude oil,
\npalm oil, paper, pulp and timber.<\/p>\n
Data from the People's Republic of China's Ministry of Trade
\nand Economic Cooperation showed that Indonesia's exports to China
\nin 2001 totaled $3.88 billion, while Indonesia's imports from
\nChina totaled $2.83 billion.<\/p>\n
Trade between ASEAN countries and China registered a record
\nhigh in 2001, totaling $41.62 billion.<\/p>\n
Budi, however, declined to provide details of the agricultural
\nproducts to be included in the early harvest package.<\/p>\n
"We shall include some fish and agricultural products in the
\nearly harvest package, but we will certainly continue to protect
\nsensitive products, such as sugar and rice," Budi said.<\/p>\n
Budi emphasized that the country would propose under the early
\nharvest package that China export to Indonesia products which
\ncannot be planted here, such as pears.<\/p>\n
Experts earlier questioned the benefits of the FTA for
\nIndonesia, considering that many Indonesian products had become
\nincreasingly less competitive over the past year.<\/p>\n
They said that the FTA could boomerang on domestic markets as
\nmore cheaper products, mainly from China, would flood local
\nmarkets.<\/p>\n
H.S. Dillon, the head of the Center for Agricultural Policy
\nStudies, said that the FTA would pose a serious threat to local
\nfarmers as they would not be able to compete against cheaper
\nproducts from China.<\/p>\n
Worse still, said Dillon, it would be extremely difficult for
\nlocal agricultural products to enter the Chinese market given
\ntheir higher prices and the fact that the market is already
\nglutted.<\/p>\n
However, Derom Bangun, the chairman of the Indonesian Palm oil
\nProducers' Association (Gapki), hailed the FTA, saying that it
\nwould enable Indonesia to export more crude palm oil (CPO) to
\nChina.<\/p>\n
Indonesia, the world's second largest palm oil producer after
\nMalaysia, has set a target to produce 7.2 million tons of CPO
\nthis year, up from 6.5 million tons in 2001.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/fta-to-benefit-ri-more-than-china-official-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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