Govt urges businesses to study WTO's July Package

Zakki P. Hakim, The Jakarta Post, Jakarta

The government urged business people here to study the impact of the World Trade Organization's (WTO) July Package in their future operations, particularly with the eventual tariff liberalization and protection of sensitive products.

Indonesian Ambassador to the WTO Gusmardi Bustami said in a discussion on Tuesday with the Indonesian Chamber of Commerce and Industry (Kadin), that the government was looking forward to getting input from business people that could be used in upcoming WTO negotiations.

"The government needs to hear from the industries," Gusmardi said.

He asked businessmen to immediately identify the goods and services that needed to be protected, including those from agricultural and manufacturing sectors.

Industries are also urged to work closely with the government to identify key export destinations and challenges faced in those markets, he said.

"In the past years, the government might have been acting as a know-it-all, but now as the world changes rapidly, the government has to work along with business people," he said.

Shinta Widjaja Kamdani, who heads Kadin's special committee for international trade, said that the chamber would provide the government with a road map on industry and trade, which could serve as a guidance for the country's negotiators in future WTO talks.

"We have now concrete recommendations in the road map, which should be useful for the government," Shinta said.

The road map, however, would be handed to the new government in mid October. She said that the road map would provide an overview of the difficulties and opportunities faced by all domestic sectors.

The government has often been criticized for lacking clear-cut strategy in WTO talks.

Business people had been generally confused as to how rapid liberalization could be beneficial for domestic industries, whereas it actually posed a real threat to ailing industries.

Chairman of Kadin's committee on product development and marketing Thomas Dharmawan, said recently that early signs of "deindustrialization" had emerged as cheap imports started to overwhelm local products, forcing some companies to go out of business.

"Instead of having a structural transformation from agricultural to industrial sector, we are moving backwards. The worse part is most business people are not aware of the trend and the fact that their fate is determined by someone abroad in a WTO negotiation," he said.

The World Trade Organization (WTO) general council meeting agreed on the "July Package" in Geneva on July 31, adopting framework on how to move ahead on trade in agriculture and industrial goods market access (NAMA).

However, despite the few significant gains for developing countries, the agreement has left a number of homework needed to be done instantly, otherwise industrialized nations would take the full benefit of the multilateral trading system.