The Start of Improving the Economy
Indonesia is one of the Southeast Asian nations which practically relied upon the Dutch's rule. Traditionally, its subsistence and trading atmosphere grew because of the help of the latter. Exporting crops were significantly emphasized and for a lot of years, their economic growth was binding with that of the Dutch. After its independence from the colonization, the centralized economic system was introduced. They have used the said scheme up until 1969 when the so-called New Order existed under President Suharto's term. The New Order was designed to have dependence on an agricultural-based economy. It had worked both for the benefits of large-scale industrial projects as well as those of small-scale consumer and export-oriented industries. The development of its economy depended upon foreign aid. Agriculture continues to be Indonesia's primary economic booster despite a very minimal 10% contribution to export earnings. Its government is one of the earliest advocates of the Green Revolution leading to its self-sufficiency on rice by the year 1984. Also raised in the country are fruits and vegetables and poultry. Cash crops include palm oil, rubber, sugar, coffee, cocoa and tobacco and are basically gown on very big estates. On the mining and manufacturing side, Indonesia's principal good is that of petroleum. In fact, the latter accounts for more than half of all the country's exports earnings. It became the member of the Organization of Petroleum Exporting Countries (OPEC) since 1962 thus placing its oil industry under government management in 1965. Furthermore, this increased the refinery's capacity. Indonesia is also the largest producer of liquefied natural gas. It is on third place with regards to production of world tin after Malaysia and Thailand. Its mining industry is prosperous with the presence of various minerals such as bauxite, nickel, coal and copper. Aside from petroleum refining, manufacturing industries in the country include fertilizers, pharmaceuticals, textiles, cement, iron and steel and plywood. While Indonesia traded fairly with its sister nations in Asia, its market is open to other foreign traders from different continents in the world. As part of its economic improvement, it traded with the United States and for several years, statistics showed that bilateral trade increased in billions of dollars. These had intensified the ties between these two nations. American companies participated actively in Indonesia with major businesses creating their own branches in the latter. Famous clothing, coffee and chocolate manufacturers are but just some of the few foreign investors seen on Indonesia's territorial jurisdiction. Major Exports and Imports between the Two Nations The main exports of Indonesia to other countries in international trade include electrical appliances, plywood, rubber, textiles and oil and gas. The imports of Indonesia from other nations include chemicals, foodstuffs, fuels and machinery and equipment. Its major export partners are Japan, US, Singapore, South Korea, China and Malaysia while its major suppliers are Singapore, Japan, China, US, Thailand, South Korea, Saudi Arabia and Australia. As of October 2008, the US Census Bureau recorded total exports from US to Indonesia at approximately $5.20 billion while the total imports from the latter to the former amounted to $13.44 billion. This creates a very good trading atmosphere between these two nations. To support this fact, the said agency also recorded data on trade between US and Indonesia with the following:
While Indonesia and US are still eyeing for future free trade agreements, the conditions for market access for films and videos were set by the former. On several occasions, government officials and representatives coming from both countries have met to tackle several issues on Indonesia's access to motion pictures and video cassettes. Specifically, the following facts were seen on the letter of Indonesia to US containing vital steps to improve conditions on market access related to the said products:
Some barriers were seen between the trade relations of Indonesia and the United States. The future of Free Trade Agreement is yet to be seen hence problems seem to be interfering along the way. In fact, the following threats were set by the US on Indonesia's trade privileges with them:
After coming up with concrete trade agreements that addressed the above concerns on GSP privileges, the future is still at stake between these two nations. A good opportunity for the US to build-up better and stronger ties with Indonesia is through the FTA that they are both eyeing for. It was in April 2006 when the launching of the talks began and more of this is to be seen in the future. Other than putting attention on the FTA, trade for the future may be opened for both sides with prospects focusing not only on businesses but with other aspects of society such as culture, education and job opportunities for locals of both nations. The site www.SIAnews.org speaks so much about the possibilities of putting up stronger relations between the US and Indonesia in more ways than one. Other future trade opportunities are geared to solve issues on health and nutrition, education, environmental services, agribusiness, financial sector safety and soundness and food. US-Indonesia Trade References
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