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NGO advises govt to be cautious over FTA with Aus, NZ

The Jakarta Post | Tuesday, February 10, 2009

NGO advises govt to be cautious over FTA with Aus, NZ

The Indonesian government should act “wiser and more cautious” before signing a new free trade agreement (FTA) with Australia and New Zealand this month, a local non-government economic watchdog insisted during a press conference in Diponegoro, Central Jakarta Monday.

“Indonesia has already signed many FTAs such as the one with Japan, Korea and China. Addition of a new agreement would only bring more burden to the country’s economy in the midst of the global crisis,” Institute for Global Justice (IGJ) Senior Researcher Bonnie Setiawan said.

“A government with a right mind will prioritize domestic economy above all else during global crisis, not opening its doors wide open for outsiders to come in freely,” he added.

IGJ’s research shows that ASEAN is Australis’a main export destination, accounting about 57 percent of its total exports in 2007.

The research also shows that if the Association of South East Asian Nation (ASEAN)-Australia/New Zealand Free Trade Agreement (AANZFTA) goes through, Australia would expand its goods trades value to US$92 billion from $71 billion in the ASEAN region. The agreement is due to be signed in Bangkok, Thailand on Feb. 27.

“Australia will also benefit in the investment sector because AANZFTA will prioritize investors’ interests, which in turn will further liberate foreign investors’ involvement with the agreement on pre-establishment principles,” Bonnie said.

“With the pre-establishment principles, investors would receive an assurance on potential loss even before they invest,” he added.

IGJ Executive Director Indah Suksmaningsih said that the government did not adhere to what domestic stakeholders had to say about the trade agreement.

“The domestic stakeholders are the ones who will feel the impact first hand whenever an agreement is signed, and the government should allow access as much as possible for free trade agreement drafts,” Indah said.

“But all this time, the process was done in such a secretive way that it raises the question that whether the government would rather bow its head to foreign investors interests than to prioritize the nation’s domestic economy,” she added.

Indah also said that she suspected the fact that Australia’s beneficiary donation worth US$380 million to Indonesia for the funding of general election, infrastructures and education was the main factor that enticed the government to sign the deal as soon as possible.

 source: Jakarta Post