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High-Tech, Toy Standards, Agricultural Imports Among Topics in U.S.-Indonesia Talks

Thursday, April 14, 2016
Sandler, Travis & Rosenberg Trade Report

The United States and Indonesia met April 11-12 under their bilateral trade and investment framework agreement to discuss ways to boost trade and investment.

According to a press release from the Office of the U.S. Trade Representative, the two sides discussed Indonesia’s economic reform and liberalization agenda, the progress made over the past year and plans for progress in the year ahead. Specific issues included localization requirements in the high-tech sector, toy standards and new agricultural import requirements.

The U.S. provided information on the Trans-Pacific Partnership in response to Indonesia’s interest in potentially joining that agreement and officials discussed other regional and multilateral initiatives as well, including Indonesia’s ratification of the World Trade Organization Trade Facilitation Agreement and implementation of the Asia-Pacific Economic Cooperation forum environmental goods commitments. Other topics of discussion included investment issues, ways to improve Indonesia’s intellectual property protection, and proposals for further cooperation and information exchange on priority environmental issues, including combatting illegal, unreported and unregulated fishing.

USTR’s 2016 trade barriers report states that in recent years Indonesia has enacted numerous regulations on imports that have increased the burden on U.S. exporters, including import licensing procedures and permit requirements, product labeling requirements, pre-shipment inspection requirements, local content and domestic manufacturing requirements, and quantitative import restrictions. Numerous other measures have been adopted or are being considered in the context of draft legislation; e.g., a comprehensive trade law passed in February 2014 outlines the government’s broad powers to oversee trade, including the ability to limit exports and imports to protect domestic interests. The report notes that in recent months the Indonesian government released ten economic reform packages designed to ease regulatory burdens and attract additional investment but that due to their limited scope and slow implementation these packages have not yet significantly altered the protectionist nature of Indonesia’s trade and investment policies.

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