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Letter: Imported food products
Mon, 12/01/2008 10:34 AM | Reader's Forum
I'd like to comment on the Trade Ministry's and Finance Ministry's direction concerning imported food products and liquor importation.
The ban on U.S. beef has been lifted, but a certain political flunkie has been appointed as the "sole" importer of U.S. beef that curtails large meat import companies to import.
They are forced to place their orders through the group whereas they have their own import licenses and can legally import U.S. beef.
They are forced to place their orders through one of the companies whereas they have their own import licenses and can legally import U.S. beef. I'd like to see the United States place a ban on your shrimp exports -- tit for tat.
We're seeing a typical Indonesian government reaction regarding the total inspection of all food products just because China screwed up.
The raids on grocery stores and confiscating products that are not on the approved list, as if you have the ability and the means to test all food products. Going so far as to demand the recipes of various products is just plain silly.
The ongoing restriction of liquor affects your tourism industry and has led to smuggling, which robs the government of much needed tax funds.
You want foreigners' investment, but you make difficult for expatriates to actually enjoy their time in Indonesia.
MIKE Coleman
Jakarta
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Jack4563 (not verified) — Mon, 12/01/2008 - 1:46pm
I also would like to add that the ban on imported products doesn't benefit local producers as some short sighted people believes.
I'm all for consuming local products whenever possible, however banning imported goods, being food or anything else, doesn't do any good to the local economy.
First of all, sometimes local products are of poor quality and wouldn't be purchased anyway by consumers seeking high end products. You can't expect a guest in a five star hotel to accept a local arak in place of an aged scotch whiskey, or a locally produced wine in place of a premium French wine. It just won't happen.
Then there are plenty of local producers which rely on imported quality ingredients for their products. These will be forced to switch to low grade ingredients thus decreasing the quality of their products. As a concrete example, local furniture companies won't be able to export furniture if they can't use imported high quality hardware. Who would buy expensive hardwood furniture fitted with cheap hardware?
Competition from high quality imported products will push local producers to improve their quality and competition from cheap ones will force them to increase efficiency. This will in return lead to an increase in exports because local products will then be more competitive also in the international market.
And, of course, local consumers will enjoy cheaper and better products.
The problem here is the red tape, it's so difficult to import products legally (unless you are a large company with deep pockets) that most choose to rely on import agencies which handle the imports in a semi legal (and very expensive) way.
They don't do it to avoid paying import duties, simply there is no other way. Try, if you don't believe me.
At the end the government loses millions of dollars in import duties, it costs the importers lots of extra money and, as usual in Indonesia, the only ones who profit from this is the middlemen.
Regards,
Jack