Indonesia to offer to liberalize 7 service subsectors at WTO<\/p>\n
Zakki P. Hakim, The Jakarta Post, Jakarta<\/p>\n
Indonesia is preparing to liberalize seven of its service
\nsubsectors in a bid to improve the country's support services in
\ntrade of goods.<\/p>\n
According to Minister for Trade, Mari E. Pangestu, the
\nsubsectors are going to be offered for negotiation with the WTO,
\nand will include legal services, health services, vocational
\neducation, construction, hospitals, business visas and banking.<\/p>\n
The \"service offers\" will be submitted in the coming WTO
\nmeeting next month in Geneva.<\/p>\n
\"Based on our assessment, these seven subsectors are ready to
\nbe liberalized. However, we are allowed to revise the list until
\nMay,\" she told reporters after a meeting with state officials
\nfrom the ministries of health and national education, central
\nbank, and directorate general for immigration late last week.<\/p>\n
However, details of legal requirements for the proposed
\nliberalization are still unclear as the related institutions are
\nstill in discussions until next month.<\/p>\n
Minister of Health, Siti Fadilah Supari, said Indonesia was
\nready to open access only for hospitals specializing in specific
\ndiseases, such as cancer, and they must have a capacity of more
\nthan 400 beds.<\/p>\n
\"We will limit such hospital operations to Jakarta and
\nSurabaya only,\" she said, adding that the government would compel
\nforeign hospitals to employ a certain percentage of local
\nworkers.<\/p>\n
Under the WTO, member countries negotiate commitments to
\nservices liberalization under a framework of principles called
\nthe General Agreement on Tariffs and Services (GATS).<\/p>\n
GATS groups services into 12 sectors and recognizes 160
\nsubsectors. The sectors are: business services, communications,
\nconstruction, distribution, education, environmental sources,
\nhealth related services, financial services, tourism,
\ntransportation, recreation-culture-sports and other services.<\/p>\n
In general, Indonesia's policies in services are more advanced
\nthan its actual commitment under GATS, thus in future
\nnegotiations the government would include more commitments or
\nrevised ones.<\/p>\n
Mari said the government was preparing to revise its binding
\ncommitment to allow foreigners to control 51 percent of a bank's
\nshares from the 49 percent committed at the moment.<\/p>\n
In practice, however, the country has let foreigners control
\nstakes in banks of up to 100 percent, she said. Thus, a binding
\ncommitment allows the government to protect its banking sector by
\nstipulating that foreigners may only hold a stake of 51 percent.<\/p>\n
Liberalizing services -- such as in shipping, finance, banking
\nand telecommunications -- is believed to make the sector far more
\nefficient and leading to a boost in the trade of goods.<\/p>\n
The government also believes that Indonesia should accelerate
\nthe pace of liberalization in services or risk being behind as
\ninvestment can easily move to more efficient countries.<\/p>\n
Aside from the negotiations for expanding market access in
\nservices, WTO member countries are also in talks to set rules
\nthat govern the liberalization of the sector.<\/p>\n
However, industrialized countries are more interested in
\npushing for talks to widen market access, leaving negotiations on
\nrules in limbo, claimed the trade ministry's director for
\nmultilateral cooperation, Djunari Inggih Waskito.<\/p>\n
Negotiations on rules would cover such matters as emergency
\nsafeguard measures (ESM), subsidies, domestic regulations,
\nservices assessment method and government procurement.<\/p>\n
Indonesia in particular was pushing to establish ESM, which
\nwas necessary to control the inflow of services if a surge
\noccurred that could threaten or damage the local industry.<\/p>\n
\"We have been pushing the issue of establishing ESM for the
\nlast seven years, only to face constant prevarication from the
\ndeveloped world,\" Djunari said.<\/p>",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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