Indonesia situation still uncertain after WTO ruling, says Aussie industry rep

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Indonesia situation still uncertain after WTO ruling, says Aussie industry rep

While a final resolution on Indonesia is in limbo, the Australian Horticultural Exporters Association  (AHEA) is focused on boosting supply chains with Asian countries to improve bilateral trade and relationships in the process. 

The Indonesian Government is challenging a ruling made by the World Trade Organization (WTO) last month, which claimed import rules - including for fresh produce - are in violation of global trade rules.

According to Moreland Asia Pacific, Indonesian Trade Minister Enggartiasto Lukita said the country had deregulated the imports concerned through the introduction of economic policy packages.

The minister claimed these addressed the concerns brought by New Zealand and the USA in the dispute. 

The claim also involves third parties including Australia, Argentina, Brazil, Canada, the European Union, China and Thailand.

Speaking with, AHEA CEO Dominic Jenkin says the industry welcomes the WTO panel's determination.

"But we need to proceed to another stage before we can see what that means precisely for industry," he says.


Dominic Jenkin

"It still needs to pass from the panel’s determination through to the dispute settlement body to make the final recommendations to Indonesia, and we need to see that that occurs. 

"Certainly it's positive...they were quite clear on some of the points of what was happening there and how they see the matter. That will be welcomed by the industry and it’s very important for Australia to have that kind of outcome as well."

He says Australia's horticultural exports to Indonesia were AUD$80 million in 2015-16, with table grapes, citrus and pears as the leading crops, followed by cherries and apples. 

"A big question mark remains. There seems to be a fair bit of instability in Indonesia at the moment and I guess it makes it hard with the trade environment to know as regulations can change and other issues can change," he says.

"It makes it challenging for exporters to see more clarity and more inclusive trade that is positive and can improve the confidence of trading with that market as well, because we’ve seen a deterioration of that with these types of issues over the last couple of years.

"I think you could safely say there’s a rise in instability on a lot of fronts in the region and you could say globally, and how that’s going to play out in the trade of horticultural products is probably anybody’s guess."

This means exporters need to "keep an eye on every front", he says, so they can respond in the best way possible.

"It does require having strong relationships, and a good understanding that trade is bilateral as well. 

"Your trading partners will need to value the two-way trade that goes on, so understanding what they’re looking for in the relationship as well and understanding it’s not just one-way, it's steps like that which will will increase the stability of the relationships."

As part of this focus on strengthening bilateral trade, the AHEA is working on projects to support countries in successfully exporting to Australia.

"We understand that is also vital that they have a successful outturn of product that will contribute to a strong relationship between the two partners," he says. 

"If we get good quality product that increases consumption across the board, it can actually be beneficial for the local production in that we see increases in consumption and value of the product as well. When it’s done well, it is good for all."




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