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Indonesian Trade Liberalisation: Estimating The Gains

Author

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  • Tubagus Feridhanusetyawan
  • Mari Pangestu

Abstract

Indonesia has undergone comprehensive trade liberalisation by participating in multilateral and regional trade arrangements and by conducting unilateral liberalisation. This paper evaluates the different paths of liberalisation the country has followed, and measures their effects on the economy. It considers the impact of several liberalisation scenarios: unilateral liberalisation; regional liberalisation through APEC (Asia Pacific Economic Cooperation) and AFTA (the ASEAN Free Trade Area); and multilateral trade liberalisation through the Uruguay Round (UR). The results show that the full implementation of UR and APEC liberalisation would greatly benefit Indonesia, and that unilateral liberalisation, carried out in conjunction with the UR commitment, would lead to large welfare gains. On the other hand, the creation of AFTA is expected to add little to welfare in Indonesia or in the other ASEAN member countries.

Suggested Citation

  • Tubagus Feridhanusetyawan & Mari Pangestu, 2003. "Indonesian Trade Liberalisation: Estimating The Gains," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 39(1), pages 51-74.
    • Handle: RePEc:taf:bindes:v:39:y:2003:i:1:p:51-74
    DOI: 10.1080/00074910302008
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    Cited by:

    1. Muhammad Sofjan, 2017. "The Effect of Liberalization on Export-import in Indonesia," International Journal of Economics and Financial Issues, Econjournals, vol. 7(2), pages 672-676.
    2. ANDO Mitsuyo, 2009. "Impacts of FTAs in East Asia: CGE Simulation Analysis," Discussion papers 09037, Research Institute of Economy, Trade and Industry (RIETI).
    3. Vanzetti, David & McGuire, Greg & Prabowo, 2004. "Trade Policy at the Crossroads - The Indonesian Story," Conference papers 331197, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    4. Yoko Oishi & Dainn Wie, 2023. "Importing Inequality: Trade Liberalisation, Technology and Women’s Employment," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 59(3), pages 391-419, September.
    5. Kyunghoon Kim & Arriya Mungsunti & Andy Sumner & Arief Anshory Yusuf, 2020. "Structural transformation and inclusive growth: Kuznets' 'developer's dilemma' in Indonesia," WIDER Working Paper Series wp-2020-31, World Institute for Development Economic Research (UNU-WIDER).
    6. Dini Yuniarti, 2010. "Agreement on agriculture and Indonesian rice import," Economic Journal of Emerging Markets, Universitas Islam Indonesia, vol. 2(3), pages 299-302, April.
    7. J. Thomas Lindblad, 2007. "Indonesia and China Today," Journal of Developing Societies, , vol. 23(3), pages 369-392, July.
    8. Acharya, Sanjaya, 2011. "Making unilateral trade liberalisation beneficial to the poor," Socio-Economic Planning Sciences, Elsevier, vol. 45(2), pages 60-71, June.
    9. Lee, Hiro & Roland-Holst, David, 2000. "Trade and Transmission of Endogenous Growth Effects: Japanese Economic Reform as an Externality for East Asian Economies," Conference papers 330892, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    10. Yessi Vadila & Budy P. Resosudarmo, 2020. "Tariff reform and income inequality in Indonesia," Regional Science Policy & Practice, Wiley Blackwell, vol. 12(3), pages 455-475, June.

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