Indonesia rejects conditions on GSP<\/p>\n
JAKARTA (JP): Coordinating Minister for Economy and Finance
\nSaleh Afiff yesterday challenged the United States over the
\npossible termination of its Generalized System of Preferences to
\nIndonesia in their continued efforts to tie trading privileges to
\nlabor issues.<\/p>\n
After addressing a one-day seminar organized by the
\nAssociation of the Indonesian Economists (ISEI), Saleh told
\nreporters that the U.S. currently imposes a number of
\nrequirements on Indonesia to qualify for the GSP facility.<\/p>\n
\"One of the conditions, which I see as strange, requires
\nIndonesia to improve the protection of its worker rights. If the
\nterms of the GSP are too difficult to meet, we are better off
\nforgetting the facility,\" Afiff said.<\/p>\n
Indonesian exports enter the American market duty free under
\nthe GSP statute and amount to approximately US$620 million a
\nyear.<\/p>\n
Last year the U.S. government threatened to revoke trading
\nprivilege unless Indonesia improved its labor conditions. Despite
\nits decision last February to suspend its investigations of
\nIndonesian labor policies for six months, the U.S. has yet to
\nmake a decision with regards to the GSP.<\/p>\n
The Indonesian government has repeatedly stated that it will
\nreject any economic aid or trade privileges which are tied to
\nnon-economic issues, such as human rights and environmental
\nissues.<\/p>\n
\"After all, the proportional role of our exports under GSP to
\nour total exports is very small,\" Afiff added.<\/p>\n
Indonesian total exports last year amounted to US$36.8
\nbillion.<\/p>\n
He said that the Indonesian products exported under the GSP
\nstatute were generally not competitive on the world market.<\/p>\n
As a signatory to the new General Agreement on Tariffs and
\nTrade (GATT), Indonesia should better prepare its export-oriented
\nenterprises to live without the GSP as the condition will be
\nphased out beginning next year regardless.<\/p>\n
\"Without preferential U.S. treatment and the government's
\nsubsidies, I'm sure that Indonesian enterprises will be able to
\ncompete better in the global market, provided they improve their
\nefficiency,\" Saleh said.(rid)<\/p>",
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