Import Duty of Stearic Acid to USA Not Zero Percent anymore

InfoSAWIT, JAKARTA – General Director of International Trade Negotiation, Ministry of Trade, Iman Pambagyo emphasized, Indonesia and the stakeholders (businessmen) are formulating the strategy knowing that United States of America (USA) has no longer run the generalized system of preference (GSP). The revoking of GSP is for three products of Indonesia, they are, tyre, derivative products of swallow, and stearic acid. The three products might surpass the Competitive Need Limitation (CNL). USA announced it on 24 November 2017.

“Ministry of Trade, the other related institutions, and the businessmen in tyre, derivative products of swallow, and stearic acid have been arranging the submission, or input from USA government so that the three products could get GSP in USA markets,” he said in the official statement to InfoSAWIT, Wednesday (29/11).

GSP is the uniteral program of USA that gives income tax reaching 10% to about 141 developiing countries and not developing countries in the world for more than 3.500 products within the threshold regulation. If the product exports have surpassed the regulation, the GSP could be revoked for they could compete in USA markets without GSP.

“It needs to arrange the submissionn to get the accurate supporting data and arrange the argumentation that the three products are important, not only for Indonesia, but also the industries and consumers in USA,” he said.

He also said, if the three products are proved to compete, it would be positive for Indonesia. It means, the products are ready to compete in USA markets without preference. But if they are not competitive, and the preference is revoked, it would be a duty for the government of Indonesia to prepare the argument to USA to postpone the revocation.

“The government has its duty to protect the businessmen. In addition, most of the products in the GSP scheme are produced by the small businessmen in the developing countries or the products are not produced in USA,” he said.

USA now studiies the GSP in every single year to every country getting the GSP scheme through United States Trade Representative (USTR). Now Indonesia is the four biggest countre getting the GSP program, after India, Thailand, and Brazil. 11% of the total exports from Indonesia to USA derived from the products having GSP within the total reaching about USD 1,8 billion.

USA once announced it through the site of USTR that the government studies and aims to end the GSP program to the developing countries per 1 January 2018. But there is no official statement of the plan.

The countries getting GSP now make alliance, called, GSP Alliance to approach USA. GSP Alliance would argue that the GSP is still needed, not only by the countries, but also the intermediary industries in USA that need products within competitive price. In addition, most of the products are not produced in USA or if they are produced in USA, they have no competitive price.(T2)

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