Apindo still scrutinising developments in US trade tariffs
Jakarta (ANTARA) - The Indonesian Employers’ Association (Apindo) is still monitoring developments in United States (US) trade tariffs following the results of the United States Trade Representative (USTR) investigation into excess production capacity.
“So we are still continuously monitoring what the final outcome will be, because this USTR investigation is not yet complete. We are still waiting for the decision on what percentage we will receive for excess capacity,” said Apindo Chairperson Shinta W. Kamdani in Jakarta on Tuesday.
The US Government, through the USTR, has set a 10 per cent tariff on products from Indonesia. This tariff is based on the results of a Section 301 investigation concerning the prohibition of goods made using forced labour.
Among the 60 countries subjected to tariffs by the US, Indonesia is considered one of the countries compliant with anti-forced-labour regulations.
The USTR set the tariffs based on the results of a Section 301 investigation under the Trade Act of 1974 covering 60 countries and territories.
Indonesia is among a group of 17 countries and territories subject to an additional tariff of 10 per cent, alongside Argentina, Bangladesh, Cambodia, Canada, Ecuador, El Salvador, Guatemala, Honduras, India, Jordan, Malaysia, Mexico, Pakistan, Sri Lanka, Trinidad and Tobago, and the United Kingdom.
The Indonesian government is currently still awaiting the results of the USTR investigation into excess production capacity.
Shinta said it is important for the government and the business and industrial community to observe how tariffs develop for other competing countries such as Vietnam, Cambodia and the Philippines.
This, she continued, is because it greatly affects the performance and competitiveness of Indonesian products on the global stage.
“What we need to pay attention to is what tariff the other countries receive, because that is the key for Indonesia. Our competition is in labour-intensive sectors such as textiles, garments and footwear. Some 61 per cent of textile and garment exports go to America, and the same goes for footwear and furniture, whose contribution is significant. This is really what we are noting,” Shinta explained.
Beyond trade tariffs, Shinta said Indonesia’s cost of doing business also needs special attention in order to maintain the competitiveness and competitive level of national products.
“Because if our products enter the US at a higher cost, we certainly cannot compete, because when we make comparisons, we can already see that in terms of product costs, Vietnam is more competitive than Indonesia because their cost of doing business is lower,” she said.