Indonesia seeks retention of US tariff preferences

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Indonesia is pushing to avoid being dropped from a list of countries that receive preferential US trade terms.

The Southeast Asian nation's foreign and trade ministers confirmed on Sunday that officials had put its case to American Secretary of State Mike Pompeo who attended an ASEAN foreign ministers' meeting in Singapore.

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

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

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

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

Total exports to the United States were 17.8 billion US dollars, data in 2017 from Indonesia’s trade ministry showed. Indonesia ran a 9.7-billion-US-dollar 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.

Indonesia wants an exemption for steel products /VCG Photo

The minister said he and 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 US dollars. Lukita said Pompeo had agreed on the need to increase economic ties and increase the countries’ strategic partnership.

“President Trump wants to trade with Asia, with Indonesia,” Pompeo told Indonesia’s Metro TV, calling the trade between the two “incredibly important.”

Source(s): Reuters