U.S. will boost trade with RI
U.S. will boost trade with RI
JAKARTA (JP): The United States will continue to support trade
ties and investment in Indonesia despite its opposition to
Indonesia's national car policy.
Visiting U.S. Secretary of Commerce Mickey Kantor said
yesterday that Indonesia remained a priority on Washington's
foreign trade map.
He said that Indonesia, the largest country within the
Association of Southeast Asian Nations (ASEAN), contained
tremendous business opportunity for American companies.
"The potential for greater growth in bilateral trade is vast
-- but not of course without challenge,' Kantor told a luncheon
meeting organized by the American Chamber of Commerce.
He noted that the challenge did not come only from the
longstanding Japanese presence in the country but also from
renewed European interest in the Indonesian market.
Kantor said that Indonesia's newly announced car policy is
one of "few clouds" in U.S.-Indonesia trade relations.
"For one, we are concerned about the recently announced
national auto policy," said Kantor, who arrived from Seoul on
Wednesday.
"Quite frankly, we believe it to be inconsistent with the
spirit of APEC, which has benefited from President Soeharto's
leadership, especially his crafting of the Bogor Declaration," he
said.
According to the Bogor Declaration, the Asia Pacific Economic
Cooperation (APEC) forum, of which Indonesia and the United
States are members, aims to liberalize trade and investment by
2010 for developed members' economies and by 2020 for developing
members'.
Kantor said Indonesia's "national car" policy is inconsistent
with its own commitment to the World Trade Organization (WTO).
The national car program gives favored tax treatment to PT
Timor Putra Nasional, which is the only company licensed by
government to produce "national cars".
He said the new car policy is inconsistent with Indonesia's
intention to solicit greater foreign investment from the United
States and other countries.
Speaking at a press conference after the luncheon, he said:
"We support open market, we support the indigenous car industry,"
He said the controversial car issue was one of many topics
raised during his meetings with President Soeharto and senior
officials, including Minister of Industry and Trade Tunky
Ariwibowo.
Kantor said the results of the meetings included an agreement
"to work together and to cooperate to make the auto policy
consistent with the WTO principles."
"We will be very careful," he said when asked how the United
States would help bring the Indonesian car policy in line with
free trade rules.
On Wednesday, he told reporters that the United States would
not contest the Indonesian car policy at the WTO.
"I haven't threatened anything, I'm here to grow relations."
Washington would address the auto policy issue in an "appropriate
fashion," Kantor said.
The government in February granted pioneer status to Timor
Putra to produce a "national car" with Kia Motors of South Korea.
This exclusive treatment gives the company incentives, including
exemptions from import duties and luxury sales tax.
The tax incentives, which last three years, will enable the
company to sell its 1,600 cc cars at half the price of similar
Japanese models.
Timor Putra, which is owned by President Soeharto's son Hutomo
Mandala Putra, will import the cars until its own assembly plant
is ready in 1998.
Car makers from Japan, the United States and Europe have
attacked the national car program, saying that the exclusive
treatment given to Timor Putra is unfair.
Kantor said yesterday that the car policy and intellectual
property rights are two areas of concern for the United State's
economic ties with Indonesia.
Kantor also visited the Indonesia Air Show '96 with State
Minister of Research and Technology B.J. Habibie before leaving
for Thailand last night. (hen)