Posted by: mel | January 11, 2010

Free trade to affect Indonesian industries

ANTARA News | Jakarta | Economic & Business | 11 January 2010

University of Indonesia (UI) economic analyst Ninasapti Triaswasti said the ASEAN-China Free Trade Area (ACFTA) effective January 1,2010 would affect certain industrial sectors in Indonesia.

“Certain industrial sectors such as garments and footwear industries are likely to be affected by the free trade area,” she said in a discussion on the fate of local industries in the face of the ACFTA system here over the weekend.

She said available data showed that over the past five years. industrial product exports had continued to decline and the implementation of the ACFTA would affect industries and workers.

After all, garment and footwear industries were labor-intensive industries which provided jobs for and improved the welfare of a large number of workers.

With the ACFTA, Chinese products, which are cheaper, would flood Indonesia`s domestic market. “The influx of Chinese products could threaten local industries whose products are more expensive,” she said.

She said the government could take precautionary steps such as delaying the implementation of the free trade for certain industrial products which were not yet ready to compete.

The economic analyst said that the Indonesian government signed the ACFTA agreement in 2002 but it had not prepared the domestic industries to face it.(*)
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