Indonesia's farm products resurface at ASEAN meet
Indonesia's farm products resurface at ASEAN meet
By Riyadi
BANGKOK (JP): Indonesia's 15 protected farm products has
remained a thorny issue in the lead-up to the fifth summit of the
Association of Southeast Asian Nations (ASEAN), which begins
today.
The row over Indonesia's request to withdraw 15 agricultural
products from the association's tariff reduction scheme, resolved
in Indonesia's favor by an ASEAN council on Sunday, resurfaced in
the meetings of ASEAN economic ministers on the following two
days.
Coordinating Minister for Production and Distribution Hartarto
told the economic ministers meeting that he had not received a
cabinet mandate to confirm a 2010 deadline for the bringing of
the 15 products into the ASEAN Free Trade Area (AFTA)
arrangement.
"They (the Indonesian delegation) have to go to the cabinet.
In other words, they still do not agree with the decision that
they agreed with in the AFTA Council (on Sunday)," Krirk-krai
Jirapaet, director general of the Thai Business Economics
Department said, as quoted by a local newspaper.
Asked whether this was correct, Hartarto said only:
"Everything has been settled. That is the main thing. Okay."
The AFTA Council, the ASEAN body overseeing the implementation
of the tariff reductions, agreed on Sunday to create a special
category in its tariff reduction scheme to accommodate
Indonesia's request.
Because of the new category, called the "temporary exclusion
list of unprocessed agricultural products", Indonesia is allowed
to protect the 15 products until the year 2010, although the
protection could be subject to review in 2003.
Big brother
Some Thai sources, the toughest critics of Indonesia's move,
have accused Indonesia of adopting a "big brother" stance in its
insistence on protecting the 15 products.
They say they are concerned that Indonesia's move will set a
bad precedent within ASEAN; one that might later be followed by
other member-countries which want to protect certain products.
Minister of Industry and Trade Tunky Ariwibowo played down the
accusation, saying that not everyone in ASEAN could put their
products in the special new category.
Countries may include their products in the new category
provided that the goods in question are covered by state trading
enterprises of which notice has been given to the World Trade
Organization, Tunky said.
Indonesia's 15 protected farm produces include rice, sugar,
wheat, soybeans, garlic and cloves. All the products except
cloves are currently tightly-controlled by the government through
the National Logistics Agency.
Cloves, meanwhile, are under the control of the privately-run
Clove Bumperstocking and Marketing Agency (BPPC), headed by
Hutomo Mandala Putra Soeharto.
Tunky said that the BPPC has fulfilled all the requirements
set out by the council. It is a government-sanctioned agency and
the World Trade Organization has been notified of its operations,
he said.
A number of critics here, however, have questioned the
protection of Indonesia's clove industry, noting that no other
ASEAN country produces the commodity. When pressed on the issue,
Tunky conceded: "We have problems in this area."
Tunky said Indonesia's insistence on protecting the 15 items
was related to "the welfare of millions of Indonesian farmers."
"Each member-country of ASEAN has its own problems, not only
Indonesia," Tunky said.
Indonesia's overall protected products in AFTA total only 17
items, lower than the Philippines' 25 items and Malaysia's 198
items.
Tunky said the Indonesian should not, therefore, be seen as a
setback for AFTA, since the 15 items constitute only a very small
portion of the thousands of products covered by the AFTA
arrangement.
A number of ASEAN economic ministers, including Brunei
Minister of Industry and Primary Resources Pehin Dato Abdul
Rahman Taib and Singaporean Minister for Trade and Industry Yeo
Cheow Tong, agreed with Tunky.
They said ASEAN is broadening the coverage of AFTA rapidly,
considering that the liberalization of trade in most of the items
covered will commence by 2000.
According to the AFTA Council, 38,397 tariff lines are
scheduled to be cut to a range of between zero and 5 percent by
2000. That number represents 88 percent of all tariff lines in
the AFTA tariff reduction scheme and 81 percent of all tariff
lines in ASEAN.
ASEAN Secretary-General Dato' Ajit Singh said that the number
of products at the center of the controversy is very small -- 15
tariff lines out of 267 on the sensitive list.
He said the overall traded value of the 15 products is only
US$41 million out of $111 billion of intra-ASEAN trade last year.
"I'm sure it will not affect ASEAN trade very much, or affect
the forward movement of AFTA in any sense," Singh told The
Jakarta Post.