Indonesia to relax trade rules to tackle COVID-19 impact

16 Mar '20

2 min read

Pic: Shutterstock

Indonesia plans to relax restrictions on importing goods as part of its fiscal measures to tackle the negative economic impact of the COVID-19 coronavirus outbreak, according to finance minister Sri Mulyani Indrawati, who recently said the number of restricted import goods may be reduced by up to half to spur business activity hurt by the pandemic.

As many as 749 harmonised system codes are to be scrapped, she was quoted as saying by Indonesian media reports after attending a ministerial meeting.

Items include textiles and textile products, ceramics, soybeans, corn, vaccines, health equipment, telecommunication tools and equipment, footwear and food supplements, according to the customs and excise office website.

The government will also relax regulations related to the food and drug monitoring agency, the minister said without disclosing details.

Coordinating Economic Minister Airlangga Hartarto said the government also plans to integrate the online Indonesia National Single Window system using Inaportnet to make logistical systems more efficient.

Manufacturing industries have complained of disruptions to their raw material supply, crippling factories across the country . Twenty to 50 per cent of raw materials for the country’s industries are usually sourced from China, Indonesia’s biggest trading partner.

The government is preparing several stimulus packages, including one that would expedite the import process for 500 importers with good reputations and another to reduce logistics costs in ports across the country.

The Asian Development Bank (ADB) previously said Indonesia might not be affected severely by the global health emergency, thanks to its minimal exposure to global trade and its wide room to maneuver in monetary policy.

Indonesia is heavily dependent on domestic demand, with household consumption growing 4.97 per cent year-on-year in the fourth quarter of 2019 to account for more than 50 per cent of gross domestic product.

The government unveiled a $717.87 million fiscal stimulus package to support the tourism industry and boost consumer spending to counter the economic impact of the coronavirus outbreak. At least 34 individuals in Indonesia have tested positive for COVID-19 and one has died.

Fibre2Fashion News Desk (DS)

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