Despite talk of free trade, new U.S. policy to hit RI agricultural exports
Despite talk of free trade, new U.S. policy to hit RI agricultural exports
The Jakarta Post, Jakarta
A new U.S. policy requiring all agricultural products from
Indonesia to undergo security inspection in Singapore before
entering the U.S. market could hurt Indonesia's agricultural
exports, the government admitted on Friday.
Ferry Yahya, director for agricultural and mining exports at
the Ministry of Industry and Trade, said that the policy could
result in additional costs for the country's exporters as it
would lengthen export procedures.
"Importers (in the U.S.) could have to pay additional
expenses, which they will naturally seek to recover from
exporters," Ferry told The Jakarta Post.
"As such, it will hurt our exports," he remarked.
Currently, the U.S. is still Indonesia's biggest export
market. Around 16 percent of Indonesian exports go to the U.S.,
followed by Japan with 13 percent and Singapore with 10 percent.
Indonesia's exports to the U.S. were valued at US$ 7.75
billion last year, lower than equivalent 2000 figure, which stood
at $8.47 billion.
Agricultural exports to the U.S. include black pepper,
tobacco, tea, rubber, coffee and shellfish.
The new policy comes amid news that Indonesia's exports
rebounded in September following an improved economic performance
in the U.S.
Exports were up 4.21 percent in September to $5.10 billion
from less than $5 billion in previous months. The increase was
spurred by growth in U.S. gross domestic product (GDP), which
rose by 3.1 percent year on year in the third quarter, as against
1.3 percent in the previous quarter.
Mahendra, a spokesman for the Coordinating Minister for the
Economy, confirmed the new policy, saying that it would take
effect globally on Jan. 1, 2003.
"The policy requires the inspection of all containers entering
the U.S. market for possible dangerous goods," Mahendra told the
Post.
According to Mahendra, the policy is part of the U.S.'s
efforts to step up security at home to counter the threat of
terrorism.
However, Mahendra said that although the policy was slated to
take effect in January next year, there would be a more than two-
month transition period to see how the system worked.
"During this time, we will see how it operates and who's going
to bear the costs resulting from the inspections," he said.
Both government officials also claimed that so far there had
been no official notification from the U.S. government about the
policy.
"The U.S. government should have issued an official notice on
the policy," Ferry said, adding that the Ministry of Industry and
Trade would seek clarification from the U.S. Embassy as soon as
possible.