By Bernie Cahiles-Magkilat
and Madelaine B. Miraflor
In a sudden move, Indonesia lifted anti-dumping measure on Philippine bananas and non-tariff measure on onions/shallots and even urged its ASEAN colleague to immediately restart exporting these agricultural products to Indonesia.
This was conveyed by Indonesian Trade Minister Enggartiasto Lukita during a bilateral meeting with Trade and Industry Secretary Ramon M. Lopez and Agriculture Secretary Emmanuel Piñol, where Indonesian official urged Filipino exporters to start exporting immediately these agricultural products to his country.
During the meeting, the Indonesian Minister, who was accompanied by Indonesian Ambassador to the Philippines Sinyo Harry Sarundajang, said that these products can now be exported because the Indonesian government has already recognized Davao Region, Northern Mindanao, and SOCCSKSARGEN as pest free areas for banana production. Indonesia has also recognized Nueva Ecija, Ilocos, and Mindoro as pest-free for shallot/onion production.
The DA and DTI considered these developments a “breakthrough” in the bilateral partnership between the two countries as exports were stopped previously due to Indonesia’s imposition of non-tariff measures.
The bilateral meeting has also resulted in the signing of a memorandum of understanding between PT. Mayora of Indonesia for the purchase of 1,000 metric tons of desiccated coconut from Philippines’ Franklin Baker. PT Mayora will use the dessicated coconuts for its biscuit products for the Indonesian market as well exports.
In addition, the Indonesian firm has committed to invest $80 million in the next five years for the coffee manufacturing and processing facility with a projected employment of 200 in the initial stage and 3,000 all in five years.
Indonesia has also agreed to Philippine requests for the accreditation of three testing laboratories to facilitate the export of fresh products. The Philippines also requested Indonesia’s Ministry of Agriculture for the entry of packaged snacks.
Both sides also agreed to look and study further exports of tobacco, and palm oil to Indonesia with the creation of a technical working group with Malaysia.
In view of further addressing the widening trade deficit of the Philippines with Indonesia, the Indonesian trade minister also agreed to further look into its policy on non-agricultural exports such as its policy on pharmaceutical product exports where exporters are required to invest first in their country before they can distribute their products.
Other non-agricultural products that Indonesia may allow Philippines to export and promote include cosmetics, smart cards, electronic integrated circuits, parts and accessories of motor vehicles and office machines, copper cathodes, transmission shafts, ignition wiring sets, parts and accessories of motor vehicles.
Also included for further study is Indonesia’s practice of blasting Filipino fishing vessels who are allegedly poaching and fishing in Indonesian waters.
Both parties also agreed to convene the Philippines-Indonesia Joint Working Group on Trade, Investments, Handicrafts and Shipping immediately. Indonesia proposed to host the JWG in Yogyakarta, Indonesia. Both countries also agreed to conduct business forum, alternately in PH and Indonesia, to
conduct business matching, among others.
For his part, Agriculture Secretary Pinol cited Indonesia, long known for its restrictive trade regulations, for having opened up its market for Philippine agricultural products.
According to Pinol, he sent a DA team to Indonesia only in January this year to initiate agri exports negotiations on hopes the ASEAN country will remove the non-tariff measures on some Philippine agri products and allow more exports considering it exports tons of products here. Pinol’s request, however, was not taken seriously by Indonesia.
According to DA, Indonesia exports as much as $1 billion annually of agri products to the Philippines, mainly palm oil, while the latter only exports food products worth $50 million to Indonesia.
This situation has prompted Pinol to also consider the imposition of more restrictive import measures on Indonesian food exports.
Last week, Piñol proceeded to recommend a temporary ban on palm oil importation from Indonesia and Malaysia upon finding out that European Union has already banned the entry of palm oil imports from these two countries over environmental issues.