Jayanty Nada Shofa, Jakarta – The US has just launched another probe into Indonesia, but this time the investigation targets Jakarta's alleged failure to curb imports of goods associated with forced labor.
The Donald Trump 2.0 administration has been initiating investigations against countries to restore prior duties struck down by the US Supreme Court. In the freshly announced investigation affecting 60 economies, the US claimed that governments had "failed to impose and effectively enforce measures banning goods produced with forced labor from entering their markets".
"For too long, American workers and firms have been forced to compete against foreign producers who may have an artificial cost advantage gained from the scourge of forced labor," US Trade Representative Jamieson Greer said on Thursday local time.
The investigations will see if Indonesia has taken enough steps to stop imported goods made – be it wholly or in part – by forced labor. Greer went on to say that the failure to eradicate "these abhorrent practices" impacts American workers and businesses. According to a pre-published Federal Register notice, the US government is requesting consultations with the Indonesian side.
Hearings on the investigation are slated for April 28. Washington has given interested persons until April 15 to submit written comments and apply for requests to appear at the hearing.
The Central Statistics Agency (BPS) data showed that Indonesia's non-oil and gas imports totaled $18.04 billion in January. About 43.75% of those goods – or around $7.89 billion in value – had come from China.
Just a day earlier, the Trump government had opened a separate probe into alleged excess production, which Washington claimed to be the reason behind Indonesia's mammoth-sized positive trade balance. The probe is seen as a way to set the stage for new tariffs.
Haryo Limanseto, the spokesman for the Coordinating Ministry of Economic Affairs, had told the Jakarta Globe that Indonesia would engage in "intense" talks with the US following the probe. Indonesian goods are currently subject to Trump's 10% global tariffs.
Finance Minister Purbaya Yudhi Sadewa said Friday that a levy hike would not be much of a problem as long as competitors are subject to the same rate. He also attributed Indonesia's trade surplus against the US to Jakarta having "cheaper labor".
"But it can be hard if we face higher tariff rates than the others.... But we will pursue efficiencies if we have to. But I don't think the [trade] prospects will be that bad, even with the US investigation," Purbaya said.
Source: https://jakartaglobe.id/business/us-hits-indonesia-with-another-probe-this-time-on-forced-labo