Mon, 29 Aug 1994

Indonesia' import tariffs are safe from GATT Acts

BOGOR, West Java (JP): Indonesia's import tariffs average at 20 percent, far below the 40 percent required by the Final Acts of the General Agreement on Tariffs and Trade (GATT) that will be implemented early next year.

"It means we are safe as we still have room of 20 percent, in case we have to take safeguard measures against imports which may harm our local industry," Rijanto B. Josokoemoro, chief of Foreign Trade Research and Development of the Ministry of Trade, told journalists during a three-day workshop, which ended on Saturday.

The workshop discussed the results of the Uruguay Round of the GATT negotiations, which were signed in Marrakesh last April.

He noted that Indonesia, anticipating barrier-free world trade, has introduced deregulatory measures to liberalize imports by lowering tariffs and reducing non-tariff barriers since 1986. The last deregulation was introduced on June 27, when the government cut import duties on 739 kinds of goods, removed non- tariff barriers from 27 commodities and lifted surcharges from 108 other import items.

Iwan Purwana, director of exports of industrial and mining products at the Ministry of Trade, said the number of goods subject to import duties of over 40 percent totals only 505 -- mostly those sensitive to price fluctuations on the world market, such as automotive vehicles, plastics and rubber -- out of more than 8,000 kinds of goods.

Paian Nainggolan, head of the ministry's Trade Research and Development Agency, said the government will continue to liberalize its import sector in line with GATT principles.

The Marrakesh agreement stipulates that all signatories are given four years to adjust their trade regulations to GATT principles. If the time limit is not adequate for the GATT signatories to make adjustments, an additional six years will be given to developing countries and four years to developed countries.

Right path

Sherry M. Stephenson, the ministry's consultant on trade policy programs, praised Indonesia's current standing on trade, saying that Indonesia in going in the right direction by liberalizing its imports.

She compared Indonesia with Chile which she considered to be one step ahead in liberalizing its trade. "Liberalization turns out to be effective in making industry more efficient."

To better prepare for the full implementation of GATT's rules, Stephenson suggested that Indonesia pay more attention to three points: customs, quality standards and trade-related intellectual property rights (TRIPs).

"Indonesia should move quickly to adjust itself with GATT's rules, especially on TRIPs, as the time limit of four years is not long," Stephenson said.

Nainggolan agreed with Stephenson's suggestion, saying that Indonesia should try hard to comply with every condition set by GATT.

"Although they (conditions) are actually created by developed nations, we have to comply with them. Otherwise we will lose forever as it's almost impossible to beat developed nations in bilateral negotiations. But in GATT, we have chances of beating them in a multilateral manner," Nainggolan said. (rid)