RI asks for fairness on protectionism

            Indonesia has asked for fair treatment concerning protective economic policies taken by developing countries in response to the global crisis, Trade Minister Mari Pangestu said Wednesday in London.

Mari said Indonesia had requested G20 leaders to allow developing countries to adopt protectionist policies that were in line with World Trade Organization (WTO) rules.

“[The exception is needed] to help them cope with shrinking global demand,” she said.

“Unlike developed countries that can protect their industries through subsidies, developing countries can only rely on trade policies.”

She added it was expected that leaders attending the G20 Summit would address what was fair for developing countries in terms of protectionism.

“We should address the issue of protectionism without imposing punitive measures unfairly against developing countries,” she told the press here prior to the summit.

Mari was responding to a WTO report released last Thursday that detailed action being taken or about to be taken by countries that indicated protective measures.

The quarterly report, the second since December last year, is issued to monitor member countries’ responses to shrinking demand resulting from the global economic crisis.

Mari said 17 of 20 countries monitored by the WTO had issued policies that disrupted trade flow, but had not infringed on WTO rules.

Indonesia is one of those still abiding by WTO rules.

“Indonesia is listed with seven policies, one or two of which are yet to become regulations. We’re protest against that,” the minister said.

“Previously, there were 10 policies the WTO deemed would affect trade flow, and we protested that because three of them didn’t even exist.”

Among Indonesia’s policies listed by the WTO are a 2008 Trade Ministry regulation on import control on the five categories of electronics, food and beverages, garments, children’s toys and footwear; a 2009 Trade Ministry regulation on the need for letters of credit in the trade of agricultural and mining commodities; and a 2009 Trade Ministry regulation on import controls for steel products.

Other policies include a 2008 Health Ministry regulation requiring foreign pharmaceutical firms to own production facilities; a Culture and Tourism Ministry regulation on services of processing film; and the 2008 Mining Law.

Besides the protectionism issue, Mari said other issues addressed at the summit included the Doha round, which calls for continued trade financing and aid for trade.

“It is expected that aid for trade should be given by developed nations to developing countries. The aid [will be used] to improve port excise and customs systems and trade facilities,” she said.