INDONESIA TO RECEIVE EU TRADE ASSISTANCE IN WAKE OF TSUNAMI
The EU is set to implement new preferential market access arrangements for Indonesia from 1 April, according to a 2 February statement by French Foreign Trade Minister Francois Loos after a meeting with his Indonesian counterpart Mari E. Pangestu. The new trade preferences, intended to help the Southeast Asian archipelago nation recover from the Indian Ocean tsunami of 26 December 2004, were originally to have gone into effect in July 2005.
EU member countries are still negotiating the new preferences under the EU’s Generalised System of Preferences, but they would likely cut import duties on a number of products, including footwear, which could see tariffs lowered from 17 percent to 13.5 percent. However, vegetable oils and wood products will not benefit from enhanced market access, since Indonesia already accounts for over 15 percent of the EU’s imports in the two sectors.
Loos also announced that France would give bilateral aid to Indonesia to rebuild the aquaculture and fisheries industries in areas devastated by the tsunami.
The US, for its part, has offered to reduce import duties on commodities and goods from the Indonesian province of Aceh, the area worst affected by the tsunami. However, Indonesian trade officials have pointed out that Aceh’s manufacturing industry is limited, and that its exports tend to go through a neighbouring province. They plan to ask the US to modify the scheme to include all goods that use materials from Aceh.
"L’UE va accorder dès avril des preferences commerciales à l’Indonésie (Loos)," AGENCE FRANCE PRESSE, 2 February 2005; "EU to give trade preferences to RI," THE JAKARTA POST, 4 February 2005; "US offers import duty cuts for Aceh goods," THE JAKARTA POST, 31 January 2005.