Foreign firms may leave RI if dumping practices not curbed

Adianto P. Simamora, The Jakarta Post, Jakarta

The Indonesia Anti-Dumping Committee (KADI) said that a number of foreign investment companies had threatened to leave the country as they could no longer compete with the imported products sold here through dumping practices.

Speaking to reporters on the sidelines of a seminar on international trade on Wednesday, KADI chairwoman Halida Miljani criticized the finance ministry for failing to impose an anti- dumping duty on a number of imported products immediately.

"I received many complaints from investors about the dumping practices, which have hurt their businesses here," Halida said.

"If the government continues to delay enforcing anti-dumping measures, the investors will shift their operations to other countries."

Worse still, said Halida, some new investors had also delayed their plans to invest in the country because of concerns regarding the same issue.

Halida declined to name which companies had been badly affected by the dumping practices.

"Dumping" refers to the practice o selling products overseas at prices below production costs.

"Many imported products, such as wheat flour, carbon black and steel pipe products, are now sold here via dumping practices," Halida said.

Local producers of the above products have long demanded government protection in the form of high import tariffs, because cheap imports had seriously hurt the domestic market.

Halida, formerly the Indonesian ambassador to the World Trade Organization (WTO) in Geneva, added that imposing a high anti- dumping duty on imported products allegedly entering the local market via dumping practices was not against WTO rulings.

Late last year, KADI proposed anti-dumping duties of between 5 percent to 35 percent for flour products imported from certain countries.

The proposal, however, was rejected by the government, which said such a move would only increase the price of the commodity at home, and create a new burden for consumers.

Earlier this year, the committee urged the government to impose an anti-dumping duty on carbon black, but this recommendation was again rejected by the finance ministry.

Data from KADI showed that the committee has so far handled 23 alleged dumping cases, and has dropped nine cases due to a lack of evidence.

Meanwhile, Indonesia has also been accused of dumping practices by several countries. Since 1996, 99 dumping cases have been opened against Indonesia.

The dumping allegations mostly came from the United States, the European Union, Australia, New Zealand, India, the Philippines, Canada and South Africa.

The government earlier said that dumping allegations against Indonesian export products had seriously effected the country's exports, causing a loss of billions of dollars in potential revenue.