Trade : the future engine of growth for Indonesia

This study examines the role Indonesian trade policies have played -- and, more importantly, can continue to play -- in this growth. The study begins with an overview of the structural transformation of Indonesian trade since 1970, the most striking feature of which was a shift in exports from raw materials and oil to manufactured goods. Subsequent sections discuss: (1) Indonesia"s trade policy regime (detailing trade liberalization policies adopted in part in reaction to the oil shock of the early 1980s); (2) the current trade scenario (with emphasis on tariff and non-tariff barriers to imports, and measures that affect export competitiveness); and (3) trade-related investment (particularly foreign investment). The study concludes that while Indonesia has come a long way towards eliminating protectionism, more must be done, especially in the area of licensing arrangements and import/export restraints.