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Structural Changes in a Reforming World Economy: Implications for Indonesia

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  • Kym Anderson
  • Mari Pangestu

Abstract

How will rapid East Asian industrialisation and international trade policy reforms affect Indonesia's economy? Taking an economy-wide perspective and drawing on projections to 2005, based on a global applied general equilibrium model (GTAP), we show the impact of Uruguay Round implementation, and explore other international influences on Indonesia's and neighbouring economies. Trade reforms likely to accompany China's (and Taiwan's) membership of the WTO are projected to boost the competitiveness of Indonesia's primary sectors at the expense of light manufacturing and the overall economy, while failure by OECD countries to honour Uruguay Round obligations to open their textile and clothing markets would reduce industrialisation in the region, slowing growth in its net food imports. The benefits to Indonesia of APEC liberalisations are also reported. All projections were completed in 1997 before the enormity of the financial crisis became clear; follow-on research should quantify the growth slowdown's impact on these results.

Suggested Citation

  • Kym Anderson & Mari Pangestu, 1998. "Structural Changes in a Reforming World Economy: Implications for Indonesia," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 34(3), pages 85-113.
  • Handle: RePEc:taf:bindes:v:34:y:1998:i:3:p:85-113
    DOI: 10.1080/00074919812331337430
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    References listed on IDEAS

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    1. Tyers,Rod & Anderson,Kym, 2011. "Disarray in World Food Markets," Cambridge Books, Cambridge University Press, number 9780521172318.
    2. Lewis, Jeffrey D. & Robinson, Sherman & Wang, Zhi, 1995. "Beyond the Uruguay Round: The implications of an Asian free trade area," China Economic Review, Elsevier, vol. 6(1), pages 35-90.
    3. Bernard, Andrew B & Jones, Charles I, 1996. "Productivity across Industries and Countries: Time Series Theory and Evidence," The Review of Economics and Statistics, MIT Press, vol. 78(1), pages 135-146, February.
    4. Warwick. J. McKibbin, "undated". "Quantifying APEC Trade Liberalization: A Dynamic Analysis," Discussion Papers 122, Brookings Institution International Economics.
    5. repec:fth:michin:378 is not listed on IDEAS
    6. Ahuja, Vinod & Filmer, Deon, 1995. "Educational attainments in developing countries : new estimates and projections disaggregated by gender," Policy Research Working Paper Series 1489, The World Bank.
    7. Deardoff, A.V. & Brown, D.K. & Stern, R.M., 1995. "Modelling Multilateral Trade Liberalization in Services," Working Papers 378, Research Seminar in International Economics, University of Michigan.
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    Cited by:

    1. George Verikios & Kevin Hanslow, 2009. "The Long-run Effects of Structural Change and the Treatment of International Capital Accumulation, Mobility and Ownership," Global Economic Review, Taylor & Francis Journals, vol. 38(3), pages 229-250.
    2. Kym Anderson & Anna Strutt, 2015. "Implications for Indonesia of Asia's Rise in the Global Economy," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 51(1), pages 69-94, April.

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