Survey on the Utilisation of Free Trade Agreements in Indonesia

Cita Wigjoseptina, Lili Yunita and Yusuf Sofiyandi ()

from Economic Research Institute for ASEAN and East Asia (ERIA)

Abstract: The Government of Indonesia has actively involved itself in several free trade agreement (FTA) negotiations and prepared for them at the regulatory level. These efforts will not be effective, however, if the private sector, as the actor in real trade, does not take advantage of the benefits provided by the FTAs. This study is aimed at determining how far the private sector in Indonesia can optimise the use of FTAs to improve overall welfare. It takes the form of a survey of manufacturing sector and services sector firms in Greater Jakarta and Greater Surabaya in Indonesia. The survey reveals that firms’ knowledge of the implementation of FTAs is limited. Despite lack of information, the use of FTAs, as indicated by the number of Certificates of Origin (COOs) obtained, is more frequent amongst medium-sized and large firms. Smaller firms face more difficulties in accessing the benefits of FTAs as indicated by the higher costs and longer time required to obtain COOs.

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Persistent link: https://EconPapers.repec.org/RePEc:era:chaptr:2013-rpr-05-05

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