OECD Trade Policy Papers
This series is designed to make available to a wider readership selected trade policy studies prepared for use within the OECD.
NB. No. 1 to No. 139 were released under the previous series title OECD Trade Policy Working Papers.
- ISSN: 18166873 (online)
- https://doi.org/10.1787/18166873
Recovery and Beyond: Enhancing Competitiveness to Realise Indonesia's Trade Potential
As Indonesia recovered from the 1997-98 Asian Financial Crisis, the economy underwent significant political and structural changes, and the role of trade policy evolved. It is clear that there is much scope for trade to enhance economic growth. However, there remain significant challenges in realising this potential, including the need to improve external competitiveness.
This paper analyses Indonesian trade policy
following the crisis, and identifies some key reforms that may help to increase competitiveness. In view of the evolving domestic and global environment, a comprehensive policy approach will be required
involving trade policy reform moving in tandem with reforms in other policy areas. Suggested reforms include, among others, complementing applied tariff cuts with reductions in non-tariff barriers and bound tariffs, reducing trade costs by easing behind-the-border regulations, and further improving the investment climate.
Keywords: micro data, productivity, FDI, backward linkage, competitiveness, horizontal linkages, spillovers, textiles, Indonesia, comparative advantage, Asian crisis, forward linkage
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