Jakarta lobbies to retain tariff treatment

JAKARTA: Indonesia lobbied visiting US Secretary of State Mike Pompeo to keep the Southeast Asian nation on a list of countries that receive preferential trade terms, its foreign and trade ministers said yesterday.

“President Joko Widodo has delivered Indonesia’s hope that the US will maintain the country’s GSP (generalised system of preferences) facility,” Foreign Minister Retno Marsudi told reporters after meeting Mr Pompeo.

In April, the US Trade Representative’s Office said it was reviewing the eligibility of Indonesia, along with India and Kazakhstan, for the GSP based on concerns over compliance with services and investment criteria.

“Around 53% of the goods covered by the GSP are commodities with links to products the US exports, while 35% are related to the production process of US products,” Ms Marsudi said.

Under the GSP, Indonesia gets reduced tariffs on about $2 billion worth of exports to the United States, including some agricultural, textile and timber products, the Indonesia’s employers association said in July.

Total exports to the United States were $17.8 billion, data in 2017 from Indonesia’s trade ministry showed. Indonesia ran a $9.7 billion trade surplus with the United States last year.

Indonesian Trade Minister Enggartiasto Lukita said Indonesia has asked the United States to exempt its aluminum and steel products.

The minister said he and Ms Marsudi had met US Commerce Secretary Wilbur Ross in Washington in July and agreed to raise the value of annual US-Indonesia trade to $50 billion. Mr Lukita said Mr Pompeo had agreed on the need to increase economic ties and increase the countries’ strategic partnership.