Australia, RI to boost trade

Australia, RI to boost trade

NUSA DUA, Bali (JP): Australia and Indonesia agreed here
yesterday to seek a mutual recognition agreement on standards and
to remove non-trade barriers to improve their two-way trade.

Australian Foreign Minister Alexander Downer and Indonesian
Coordinating Minister for Production and Distribution Hartarto
also agreed to further reduce tariff barriers.

The two ministers officially opened the two-day Australia-
Indonesian business conference and exhibition, held by the
Australia-Indonesia Business Council, here yesterday.

Downer acknowledged that Australian authorities often held up
fruit and other foodstuffs imported from Indonesia and many other
countries to ensure they met its standards, especially relating
to health.

The holding up of such imports often creates inconvenience and
imposes additional costs on exporters.

"Indonesia would like to see Australia implement more
favorable and transparent standards for imported food so they do
not become disguised non-trade barriers," Hartarto said at the
opening of the conference.

"Furthermore, simpler and more practical customs procedures
and inspection methods should be applied so costs will not be
increased," he said.

Responding to Hartarto's remarks, Downer said Australia never
used standards as disguised barriers. The problem was that its
standards had not been mutually recognized by its trading
partners.

He said: "We do not stop goods from anywhere, but the issue is
inspection of goods, and this is something to do with standards.
The reason that they are holding up goods from a lot of different
countries is simply because the standards have not been mutually
recognized.

"Therefore, one of the things we want to take up quickly
between Australia and Indonesia is mutual recognition agreement
on standards," Downer said.

He noted that there were only around 20 items out of hundreds
of Indonesian exported goods to Australia that undergo quarantine
inspections. This is in comparison to some 100 items from
Thailand and 65 from the United States.

Downer also acknowledged that the Australian government
imposed antidumping duties on two Indonesian export products to
Australia. He did not specify the products.

"But there are many other products from many countries subject
to antidumping duties in Australia," Downer told journalists.

Besides eliminating import duties, Hartarto also called on
Australia to reduce import tariffs, especially on products in
which Indonesia had a competitive edge, such as textiles,
clothing, leather and footwear.

He contended that such a reduction was necessary considering
that Indonesia still suffered a lop-sided trade imbalance with
Australia.

Indonesia's trade deficit with Australia increased 37 percent
to A$1.44 billion (US$1.1 billion) last year from A$1.04 billion
in 1995.

Australia's exports to Indonesia rose by 32 percent to A$3.15
billion last year from A$2.39 billion in 1995, while its imports
form Indonesia rose by 27 percent to A$1.7 billion from A$1.3
billion.

"The Indonesian government would indeed like to see its
trading partners, including Australia, be willing to reduce the
existing peak tariffs on Indonesia's major export products, among
other things textiles, leather products and footwear," Hartarto
said.

Downer said Australia had taken Indonesia's concerns into
consideration and had decided to lower tariffs on textiles,
clothing and footwear within the next two and a half years.

"Certainly between now and 2000, there will be a reduction in
tariff protection on textiles, clothing and footwear. And
therefore, there will be increasing opportunities for Indonesian
exporters," Downer said.

Even now, he said, Indonesian exports traveled smoothly to
Australia with very few obstacles and added "there were fewer
difficulties in terms of Indonesian access to the Australian
market."

Over the past decade, Indonesia's share of the Australian
market has grown from less than 1 percent to more than 2 percent,
while Australia's share of the Indonesian market has risen from
under 4 percent to well over 5 percent now.

"As we continue to reduce our protection in Australia, I
encourage the Indonesian government to reduce its protection as
well," Downer said.

He said that if the Indonesian government lowered its tariffs
on automotive parts and components, many more Australian parts
manufacturers would move to Indonesia.

"Australian components manufacturers, I think, can develop
very good relationships with Indonesian car companies, and we
would like to see that relationship develop in the next few
years," he said.

Hartarto responded that Indonesia was committed to continuing
deregulation and that later this month, the government would
announce a new package of deregulatory measures. (rid)

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