China’s Questions at Indonesia’s WTO Trade Policy Review

The WTO conducted its trade policy review for Indonesia on December 9 and 11. The minutes of the meeting and the questions and answers from other WTO Members were released recently. China’s questions for Indonesia provide some insights into its particular interests relating to China-Indonesia relations.

There were several questions about traditional Chinese medicine, such as the following: “Please specify whether Traditional Chinese Medicine was included in the National Health Insurance Programme mentioned in this part?” and “the production of pharmaceutical raw materials are now entirely open to foreign investment, whether the Traditional Chinese Medicine can also be produced in Indonesia by foreign investment?”

Indonesia indicated that traditional Chinese medicine was not covered by the insurance program and not open to foreign investment:

The Traditional Chinese Medicine was not included in the National Health Insurance Programme. Based on Article 52 Presidential Regulation No. 82/2018, states that health services that are not guaranteed, include complementary, alternative and traditional medicine, which have not been declared effective based on an assessment of health technology.

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Currently, based on Presidential Regulation Number 44/2016, traditional medicines industry (KBLI 21022) is closed for foreign investment. Meanwhile, the production of raw materials for traditional medicines (KBLI 21021) is open for FDI. In terms of Chinese traditional medicine production can not be done in Indonesia.

There were questions about tobacco importation and regulations, such as this one: “It is mentioned in the negative list on page 222 that retail trading via mail or Internet order for tobacco products is permitted. Please explain the distribution channels of tobacco products and the current situation of foreign-invested wholesale and retail terminals.”

Indonesia responded as follows:

In principle, the importation of tobacco is allowed with consideration between tobacco farmers and tobacco industry in Indonesia. In terms of copperation and distribution, the scheme is still under internal discussion of MoA.

There were also many questions about competition policy; export finance, guarantees and credit insurance; and on aviation related matters.

Finally, China asked questions related to: procurement; an increase in MFN applied tariffs, including on textiles and footwear; frequent use of safeguard measures; foreign investment; trade secrets; fertilizers; timber and logging; and coal.