Indonesia Needs to Promote RCEP to Avoid Being Just a Market
Jakarta. Former Trade Minister Enggartiasto Lukita said on Friday that Indonesia should promote the Regional Comprehensive Economic Partnership (RCEP) pact among its private sector to prevent the country from being just a market for other signatories.
According to Enggartiasto, some Indonesian businesses are still unaware of the major tariff elimination that the world's largest trade deal brings. If businesses fail to make use of the facilities, the RCEP would only turn Indonesia into a market as goods from other RCEP member states rush in.
"We need to promote the RCEP as soon as possible," Enggartiasto told reporters on the sidelines of a conference in Jakarta on Friday.
"Not all Indonesian companies —exporters, importers, or even producers— are aware [of the RCEP] and how they can make use of the trade pact to benefit their business,” he added.
The RCEP brings together the 10 ASEAN member states, Australia, China, Japan, South Korea, and New Zealand. If combined, the RCEP signatories represent 30 percent of the global gross domestic product (GDP). This agreement is set to eliminate up to 90 percent of the tariffs imposed on the goods traded between its signatories over 20 years of coming into force.
“If we do not promote the RCEP soon, we [Indonesia] would only become a market for the other countries that inked the agreement. As the other members are able to make use of the tariffs that the deal offers, while we don’t due to our lack of knowledge of the RCEP,” Enggartiasto said.
“I’m sure the government has made preparations [for the RCEP]. Hopefully, [they] would encourage Indonesian businesses to take advantage of the RCEP,” Enggartiasto, who also serves as the executive chairman of B Universe, said.
The RCEP came into effect for Indonesia at the beginning of this year. The date of its entry into force varies across the RCEP signatories with the Philippines being the last one to implement the deal in June. The RCEP is open to new member countries. Sri Lanka and Hong Kong are currently seeking to join the RCEP.
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