Debate on protection

In the past few weeks a number of parties have entered into a debate which, in economic texts, could be classified as "classic". The question is: Is there or isn't there a need to protect a new industry?

The new industry in question here, as we know, is PT Chandra Asri, a petrochemical mega-complex with a total investment of Rp 3.2 trillion.

There are only two opposing sides in this debate, which is just as many as there are extreme answers to the question. Some support protection and others oppose it. Each of the two parties is armed with arguments that sound familiar to anyone who has studied economics.

Considering the existing realities and the wider interests that will be involved, whether we like it or not we must take a stance. But what is the position which we should take?

The "campaign" of Chandra Asri, which will soon enter the operational stage of production by turning out the intermediate material needed by a variety of industries, could be regarded as "high profile". In August, before the its hearing with the House of Representatives, a seminar was organized at the plant site in Cilegon, West Java. A number of government officials, observers and economists, spoke during the occasion. And the participants? The entire press corps.

The difficulty in foretelling the decision which the government will make regarding Chandra Asri's request for protection, as anyone must know, stems not only from the fact that different positions prevail among the government decision makers. The reality of existing political connections, and the possibility that non- technical arguments -- such as for example the question of nationalism -- will also be considered, make it tricky to anticipate the outcome.

Naturally we hope that the forthcoming discussions in the Team of Tariffs and Fiscal Affairs, which is, as of Dec. 5, chaired by the coordinating minister for industry and trade, will be based on rational considerations. The public at large, and particularly consumers, are putting their hope on the tenacity of those who are committed to fostering non-privilege-based interests.

We look forward to receiving a New Year's present: an undivided decision from the Team of Tariffs and Fiscal Affairs that is founded on reason.

-- Republika, Jakarta