GOVT URGED TO ISSUE POLICIES TO EASE ACFTA'S IMPACT

Surabaya, E Java, Jan 7 (ANTARA) - The government should soon issue strategic policies to anticipate the impact of the ASEAN-China Free Trade Agreement (ACFTA) effective this month, an Indonesian Chamber of Commerce and Industry (Kadin) official said.

"The implementation of the free trade agreement is something inevitable but the government needs to take tactical and concrete steps by issuing regulations and policies in support of domestic products," the chamber's vice chairman concurrently coordinator for the central region, Erlangga Satriagung, said here on Thursday.

Among the measures the government needed to take were tightening the import of goods already being locally produced, allocating regional budget funds to support the "Love Indonesian Products" drive and speeding up the standardization of goods produced by small and medium scale industries, he said.

Hopefully, the regulations and policies would be able to minimize the negative impact of ACFTA's implementation, he said.

He said the government appeared to have been rather slow in anticipating the impact of ACFTA's implementation.

"This is evident from the fact that many domestic labor-intensive industries are actually unprepared for the introduction of the free trade system. Yet, the ACFTA was signed eight years ago," he said.

"The government seems to be preoccupied with political agendas so it has forgotten its policy of rescuing the people's economy which is labor-intensive," he said.

Deputy Chief of Kadin's East Java chapter Adri Istambul Lingga Gayo meanwhile urged the government to give micro, small and medium businesses wide access to product certification.

The move would encourage small and medium-sized businesses to grow and compete with foreign rivals, he said.

Only a few small and medium-sized businesses already had product certificates because of the lengthy certification procedures, he said.

"Less than 10 percent of small and medium companies' products meet the national standards. How can they compete with foreign products?" he said.
The government said early this week it had set up a special team comprising representatives from various ministries and businesses to anticipate the impact of ACFTA's implementation.

"We are responding quickly by asking businesses to work together with the government to anticipate possible disadvantages for our industries," Coordinating Minister for the Economy, Hatta Radjasa, said at a press conference.

Hatta said the team was expected to be able to improve the effectiveness of domestic market protection efforts from smuggling and also play a role in protecting and monitoring domestic flows of goods.