Can Indonesia become the 13th member of the TPP?

02 Nov '15

5 min read

As Indonesia struggles with a stubborn economic slowdown, President Joko Widodo wants his country to join the Trans Pacific Partnership (TPP). Having missed the TPP bus, Widodo wants to make up for lost time and kick start Indonesia's stuttering economy.

According to one media report, the answer to whether Indonesia can join the TPP may not lie with yes or no, but with how ready Indonesia is for this and how to set up de-regulations or regulations in order to meet all standards set in the US-led trade pact.

During a recent meeting with Barack Obama at the White House, Indonesian president Joko Widodo risked the ire of economic nationalists at home, declaring: “Indonesia intends to join the TPP.”

Ahead of his meeting with Obama, Widodo had said he would decide during his White House visit whether to join the trade pact, which includes neighboring Australia, Brunei, Malaysia, Singapore and Vietnam. But he has faced resistance from some officials in Indonesia, where the government has enacted regulations making it difficult for foreigners to work and adopted higher tariffs on imported items.

Not everybody is as keen as Widodo. Indonesia for Global Justice (IGJ) is of the view that Indonesia might weaken its bargaining position if it takes part in the TPP as it will not have enough room for negotiations, an Indonesian news agency has reported.

"Indonesia's bargaining power will become weak if it joins the TPP after the TPP is agreed upon by 12 countries," Research and Monitoring Manager at IGJ, Rachmi Hertanti, said in Jakarta.

Such a weak bargaining position will result in Indonesia having no choice other than agreeing to the standards already set previously. She also reminded that the TPP will open access for foreign companies to the procurement of government goods and services, whose values could reach trillions of dollars set in the state budget.

"This is a lucrative business for the US corporations. That is why the TPP applies non-discriminatory regulations and national treatment for foreign companies in this business activity," she said.

The TPP regulation covers extensive sectors and is comprehensive so the TPP has the potential to eliminate state sovereignty over the national economy that will be developed for the prosperity of the people.

The IGJ reminded President Widodo that he should not be careless in deciding the extent of Indonesia's involvement in the TPP. Moreover, it is not the correct choice for Indonesia to join the pact in an effort to restore its national economy.

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