Trade War Can Disrupt Regional Economy

By : Herry Barus And Aldo Bella Putra | Tuesday, July 10 2018 - 15:06 IWST

Bambang Brodjonegoro (Foto/Rizki Meirino)
Bambang Brodjonegoro (Foto/Rizki Meirino)

INDUSTRY.co.id - Jakarta - Minister of National Development Planning / Head of Bappenas Bambang Brodjonegoro considers trade war triggered by the United States government (US) can disrupt the regional economy producing products or export commodities in Indonesia.

"In the trade war, it is feared that there is protection, high tariff, which then can affect export. If the export of products or commodities is disturbed, we are worried that the economy in the commodity-producing region or goods will also be disrupted," said Bambang during a press conference at Jakarta, Tuesday (07/10/2010).

Meanwhile, in the context of Indonesia and the US itself, a trade war will indeed have an impact on manufactured export products dominated by regions in Java.

"The potential impact of trade wars, we have to see what sectors are affected, possibly the manufacturing sector, its manufacturing is textile-related, but it could be later if the US suppose to challenge Indonesia on products that have GSP (Generalized System of Preference) of course this will affect Indonesia's exports to the US, "said Bambang.

GSP itself is a trade policy of a country that benefits from cutting import duties on export products from countries that benefit from GSP.

Nevertheless, continued Bambang, if Indonesia gets obstacles from the US related to exports, the Indonesian government can divert export products to other countries and he considered that should not be a problem.

However, the Indonesian government must certainly prepare if the trade war by the US continues to maintain the competitiveness of Indonesian export products.

"Of course we have to keep ourselves in. Firstly, negotiations are put forward, and secondly we must keep our competitiveness, if we can keep our competitiveness, if we are blocked in a country, our competitive products can flow to other countries. The export network should not be disturbed, "said Bambang.

Last week, US President Donald Trump had said he would evaluate products or commodities from Indonesia that go to Uncle Sam's country. The US government will revoke the special tariffs that Indonesian export products have been exporting to the United States.

The government itself said it would send a team to conduct negotiations related to the threat of trade war of US President Donald Trump.

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