Japan and Indonesia are expanding trade cooperation and reducing tariffs on various goods under an amendment to the Indonesia-Japan Economic Partnership Agreement.
Agreement to Lift Trade Barriers
Japan and Indonesia have agreed to lift trade barriers and deepen collaboration in various fields, as announced by Indonesia’s Foreign Minister Retno Marsudi. This new agreement comes under the framework of an amendment to the Indonesia-Japan Economic Partnership Agreement (IJEPA), a bilateral investment and trade treaty signed in 2007. The amendment seeks to achieve “a mutually beneficial economic partnership between Japan and Indonesia, by further facilitating the expansion of existing trade and economic cooperation”, according to a joint ministerial statement.
Tariff Reductions and Trade Cooperation
According to the Japan External Trade Organization (JETRO), Japan will reduce tariffs on 114 new items and expand the tariff allocation quota for bananas and lightweight pineapples. In addition, Indonesia had previously urged Japan to remove tariffs on food products, especially canned tuna. Meanwhile, Indonesia will eliminate or reduce tariffs on 19 Japanese goods, including automobiles, steel, steel products, and rice flour, according to JETRO.
Market Access Improvements
Indonesia will also improve market access for Japanese short-grain rice, including establishing a low-tariff import quota with an allocated quantity of 8,500 tons and an in-quota tax rate of 450 rupiah per kilogram (approximately 4.1 yen or US$0.03). This agreement marks a significant step forward in enhancing trade relations between the two countries.
Read the original article : Japan and Indonesia Commit to Trade Barrier Removal in Updated Agreement
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