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Indonesia’s hopes for deal on CPO, rubber shattered
Publication Date : 03-10-2013
After intensive year-long negotiations, attempts to lift barriers to the trade in crude palm oil (CPO) and rubber in 21 Pacific-rim economies have led Indonesia to a dead end.
The outcome of the concluding senior officials meeting (CSOM) of the Asia-Pacific Economic Cooperation (Apec) Summit in Bali on Wednesday proved that there was insufficient support from Apec members for Indonesia to have the commodities included on the list of environmentally friendly goods eligible for tariff cuts and exemptions in 2015.
“Several members objected to the proposal [to include the commodities] because if we opened up the list again, each member would have had the same right to include their own products, thus we’d have had to negotiate all over again,” said Iman Pambagyo, Apec senior official meeting (SOM) lead for Indonesia.
“That is the reason why members still could not agree to include more commodities this year,” said Iman, who is also the Trade Ministry’s director general for international trade cooperation.
From the beginning of the negotiations, Indonesian officials had repeatedly expressed the opinion that they were fighting a losing battle.
But President Susilo Bambang Yudhoyono had insisted it was worth the fight as Indonesia’s success as host of the summit would in part be measured through the inclusion of the commodities, according to a minister.
The door for inclusion has not entirely been shut, Indonesian officials have accepted proposals from other Apec members to conduct further studies to identify products that could contribute to poverty alleviation, rural development and sustainable growth.
This proposal will keep CPO and rubber on the list of products that could be eligible for tariff cuts or exemptions under the new category of poverty alleviation.
According to Iman, there had been a positive response to the proposal from most members, including the United States which had earlier strongly opposed Indonesia’s aspiration to expand the green-commodity list.
Indonesia expects the proposal to be discussed by Apec members in 2015, when the tariff reductions on environmentally friendly goods come into effect.
Aside from the confirmation of the list of green goods, other crucial outcomes of the CSOM included support for a connectivity framework and multi-year plans for investment in infrastructure development proposed by Indonesia, according to Apec senior official meeting (SOM) chairman Yuri O. Thamrin.
The framework is expected to boost the supply-chain performance within the Asia-Pacific region by 10 per cent by 2015.
Meanwhile, US President Barack Obama’s attendance at the Apec leaders’ meeting on Oct. 7 and 8 remains on track despite the partial US government shutdown, according to Foreign Minister Marty Natalegawa.
Obama has canceled the Malaysia and Philippines legs of his four-nation tour, which aims to boost US economic ties with Asia, as his government cut back on budget spending after Congress remained in deadlock over budget approval.