Indonesia sends trade team to lobby US

File photo of a port worker watching a ship leaving the New Priok Container in North Jakarta, Indonesia. The Generalised Systems Preferences led to tariff cuts for US$1.8 billion worth of Indonesian products in 2016.
File photo of a port worker watching a ship leaving the New Priok Container in North Jakarta, Indonesia. The Generalised Systems Preferences led to tariff cuts for US$1.8 billion worth of Indonesian products in 2016. PHOTO: REUTERS

Indonesia was due to send a trade mission to the United States yesterday to lobby the Trump administration into maintaining favourable trade terms amid increasing global trade tensions triggered by the US.

A key focus of the trip is a regular US review of a preferential tariff scheme called the Generalised System of Preferences (GSP). The review, which occurs every three years, is happening this year and Indonesia is keen for the scheme to remain unchanged.

Indonesia has received considerable tariff cuts under the GSP since 1980 along with Thailand and Kazakhstan, among others.

For example, in 2016, the GSP facility led to tariff cuts for US$1.8 billion (S$2.5 billion) worth of Indonesian products, according to figures from the Indonesian Chamber of Commerce and Industry (Kadin).

Indonesia has other concerns too, including increased tariffs on steel and aluminium, while the US might bring up market access issues affecting American products in Indonesia. For now, Jakarta's main aim is to keep the status quo at a time when the US is hitting out at major trading partners China, the European Union and others for what it says are unfair trade practices.

Leading the Indonesian mission is Trade Minister Enggartiasto Lukita. He is expected to meet US Trade Representative Robert Lighthizer and Commerce Secretary Wilbur Ross.

The delegation also includes representatives from, among others, Kadin, the Indonesian Exporters Association, the Indonesian Importers Association, as well as producers of products such as tyres, palm oil, steel, aluminium and food and beverages.

 

Two-way trade reached US$25.92 billion last year, according to Indonesia's Trade Ministry. Indonesia exported US$17.79 billion worth of goods and commodities, while it imported US$8.12 billion, resulting in a surplus of US$9.67 billion.

A version of this article appeared in the print edition of The Straits Times on July 23, 2018, with the headline 'Indonesia sends trade team to lobby US'. Print Edition | Subscribe