Indonesia anger over US move to punish exporters

20-Aug-2018 - Last updated on 20-Aug-2018 at 10:15 GMT

The US is at odds with Indonesia over meat imports

Indonesia has criticised US plans to punish its exporters over Washington claims that the south-east Asian country has failed to fully lift contested restrictions on meat and meat products, saying the country is breaching international commerce rules from the World Trade Organization (WTO).

The US Government has requested WTO approval to raise duties on Indonesian exports to generate US$350 million-worth of income, which it says is the amount of trade American meat exporters lost in 2017 because of continuing meat trade restrictions imposed by Jakarta.

Under earlier WTO rulings, Indonesia had until 22 July (2018) to comply with orders to dismantle these import controls.

Indonesia has contested the US decision, arguing that it has in fact liberalised the contested import restrictions, in line with instructions from the WTO disputes settlement body (DSB).

These had included a ban on all bovine offal products (except some cuts of tongue and tail); all secondary beef cuts, including beef blade, knuckles, chuck, inside round and outside round; all bovine whole carcases; and poultry parts. Washington (backed by New Zealand) had also complained about how, for some other meat and poultry products, imports are only allowed if purchasers also buy meat from Indonesian slaughterhouses, and had objected to some tight quantitative and minimum price limits on meat and poultry product imports, among other concerns.

In its comments, at a WTO meeting in Geneva, the Indonesian Government highlighted a ‘regulation no. 23 of 2018 on the importation of carcase, meat, offal and/or its processed products’ and a ‘regulation no. 65 on the importation of animal and animal products’, both of which came into force in May (2018).

“Indonesia considers that these amending regulations have addressed all the inconsistent measures in the present dispute … full compliance with the rulings … of the DSB has been fulfilled,” said a note from the Indonesian Government.

With the two governments disagreeing over whether this is the case, the matter has now been referred to arbitration at the WTO for a further ruling.

A statement from the US Government said it “remained open to working with Indonesia to resolve US concerns”. It added: “US farmers are eager to serve Indonesian consumers their world-class products.”

New Zealand, a US ally in this long-running WTO dispute, said it “shares the US view that Indonesia has not fully complied with the WTO ruling”, noting “a critical principle of the WTO is prompt settlement of disputes”.

The controversy may be debated again at the next WTO DSB meeting, due to be staged on 27 August.