USMEF South American Expo (Click on to download PDF form) | Indonesia | Gove...

Published: Aug 29, 2003

USMEF South American Expo (Click on to download PDF form)

Indonesia

Government Threatens “Quarantine” Fees On Imports

A new Indonesian presidential decree allows the imposition of what are euphemistically called “quarantine” fees on a wide range of agricultural commodities and products for a wide range of import services, according to the Foreign Agricultural Service (FAS). The fees, if imposed, will certainly merit a challenge in the World Trade Organization (WTO) and would add significant costs to U.S. products. Different fees would be assessed on the same products depending on if they’re imported, exported or shipped within the country, which is against the WTO’s principle of national treatment. Implementation of this decree is waiting for the Ministry of Agriculture to announce regulations. It is unclear when such regulations might be issued or when they will be notified to the WTO. A separate decree from the Ministry of Agriculture is expected.

The impact on imports of U.S. beef to Indonesia is likely to be about $890 per 20-foot container and about $670 on a container of beef livers.

Indonesia is the leading market in the Association of South-East Asian Nations (ASEAN) for beef variety meats. It has a population of 207 million people and per capita GDP in 2001 was $690. Indonesia’s economy is slowly recovering from the economic and political upheaval of 1998 and 1999. In 2000, GDP grew two percent. The economy grew by 3.1 percent in 2001, and is expected to grow by 3.5 percent and 4-5 percent in 2002 and 2003 respectively.

In the first nine months of 2002, U.S. beef (including variety meats) exports to Indonesia totaled 7,053 mt (6,992 mt of variety meats), an increase of 75 percent over the same period in 2001, valued at $6 million.

A mainly Moslem country, Indonesia imports little pork, but in the first nine months of 2002, U.S. pork variety meat exports to Indonesia totaled 65 mt, an increase of 65 percent over the same period in 2001, valued at $313,000. In 2000, Indonesia slaughtered around nine million head of hogs. In 2001 and probably until 2003 production of live hogs will likely to remain near 2000 levels. Industry analysts expect production of live hogs to rise after that as wealthy Chinese businessmen return to Indonesia and the demand for pork increases.