Safeguard on Indonesian automotive imports proves competitiveness

Jakarta Industry Minister Agus Gumiwang Kartasasmita has said the imposition of safeguards on Indonesia’s automotive imports by the Philippines indicates the country’s high competitiveness in the global market.

“The imposition of the safeguard has shown that Indonesia’s automotive industry competitiveness is higher than the Philippines’,” Kartasasmita said in a statement on Tuesday, responding to the safeguard measures applied by the Philippines on imports of Indonesian passenger cars and light commercial vehicles (LCVs).

Indonesia’s car production in 2019 reached 1,286,848 units, far above the production level in the Philippines, which was recorded at 95,094 units during the same period, he informed.

According to the minister, Indonesia’s automotive industry has shown a prospective trend.

“According to my record, at least Rp30 trillion of investment will flow to Indonesia in the automotive sector,” he predicted.

The industry, he said, has a high global value chain. Hence, it has a relatively narrow price gap between countries, he explained. Indonesia exports automotive products to more than 80 countries. Its exports average 200 thousand units per year, he informed.

Between January and November, 2020, Indonesia shipped 206,685 units of completely built-up (CBU) cars, 46,446 units of completely knocked down (CKD) cars, and 53.6 million units of spare parts.

Kartasasmita said the Philippines will have to prove that automotive imports from Indonesia have dismayed its domestic industry and prompted it to impose the safeguard measures.

“Because the imposition of safeguard measures will bring its consequence in the World Trade Organization (WTO),” he added.

The Philippines government has implemented temporary trade protection in the form of import duty on passenger cars and light commercial vehicles from Indonesia.

The strategy has been taken to protect local industries.

Source: Antara News