The Ministry of Trade issues Regulation of the Minister of Trade Number 58 of 2021 concerning Provisions on Origin of Indonesian Goods and Provisions for Issuing a Declaration of Origin (DAB) for Goods Originating from Indonesia in Indonesia – the EFTA Comprehensive Economic Partnership Agreement (CEPA) or the Comprehensive Economic Partnership Agreement between Indonesia and the four EFTA countries. Minister of Trade Muhammad Lutfi said the Minister of Trade Regulation will come into effect simultaneously with the implementation of the Comprehensive Economic Partnership Agreement between Indonesia and the four EFTA countries on November 1, 2021. “This Minister of Trade Regulation is issued as an effort by the Ministry of Trade to maximize the use of export facilitation in a new phase of Indonesia's relations with European Free Countries. Trade Association (EFTA) which includes Iceland, Liechtenstein, Norway and Switzerland," said Lutfi through an official statement, Sunday (31/10/2021).
With the Permendag, said Lutfi, the smooth flow of goods and the effectiveness of the implementation of the DAB issuance for goods originating from Indonesia to EFTA countries within the CEPA framework is expected to increase. "Utilization of export facilitation through the use of DAB is expected to support increased market access to EFTA countries," said Lutfi. According to him, EFTA countries are potential non-oil and gas export destinations for Indonesia. It is hoped that after IE-CEPA is implemented on November 1, Indonesia will immediately feel the impact of opening market access to EFTA countries.
"This agreement will provide benefits such as increasing market access for goods and services including labor, facilitating the flow of goods and customs, access to investment promotion, developing Indonesian human resources, and economic cooperation programs for Indonesia," he said. In the January–August 2021 period, Indonesia recorded a non-oil and gas trade surplus with EFTA countries of US$609.8 million. The trade surplus came from Indonesia's exports to EFTA which reached US$1.11 billion and imports which amounted to US$504.5 million. Indonesia's trade to EFTA countries is dominated by Switzerland with exports amounting to 96 percent of Indonesia's total exports to EFTA or US$1.07 billion, and imports amounting to 71 percent of Indonesia's total imports from EFTA or US$358.9 million.
Indonesia's largest non-oil and gas export commodities to EFTA countries in 2020 include gold, jewelry, metal waste, optical fiber, and bulldozers. Meanwhile, Indonesia's largest imports from EFTA include bombs and grenades, ink for printing purposes, and watches. On the other hand, the Acting Director General of Foreign Trade at the Ministry of Trade Indrasari Wisnu Wardhan said the implementation of the trade agreement would allow Indonesia to benefit from the imposition of preferential tariffs by using the Certificate of Origin to reduce production costs. These benefits can increase the competitiveness of the industry and make Indonesian products more competitive so that it has an impact on increasing the country's foreign exchange. "The government takes strategic and out of the box policies to face global challenges full of uncertainty and to encourage post-Covid-19 economic recovery," said Wisnu.
