CHINA-ASEAN FREE TRADE AGREEMENT (CAFTA)

By Mohammad Arifuddin, SHI.

Indonesia is a country in South East Asia. Indonesia is the member of ASEAN. Free Trade Agreement ASEAN and China (CAFTA) makes Indonesia must be ready to open Free Trade with China. The local entrepreneurs must dare to chalange with China products which spread in Indonesia Market. The chalanges are not only the quality of the products but also the price. As well known, the price of China products are cheaper than local products. Moreover the China products have spreaded for while in Indonesia.

In fact the local products can’t chalange with China products. Our sociaty has not been ready to face the free trade. The government must prepare the sociaty’s education to improve their skill, talent in order that they can be more creative and inovative. Moreover the government must cut the tax for entrepreneurs and cut the interest. Because the tax and the interest are still too high for them. If the government doesn’t do this policy, as a result the local companies will become bankrupt. So many employments will be fired and will creat new jobles. I think the government must perform renegosiation to cancle the agreement and to seek the other ways out by making new concept of trade, that is “fair trade”. The trading that gives sharing profit by following rules of busines.

Free trade is quite different from fair trade. Free trade is no limitation among countries and even no rules. So foreign products will be free to enter in our markets including the traditional markets. We know that sellers want to buy products by low price and sell them by high price. China products are the cheapest, so the sellers and the buyers would rather choose China products than Local products.

What did government do to anticipate this condition will be ? Will government decide better policy to help the local entrepreneurs in order to keep going doing their busines future ? Those are our questions.

We hope so much that our government must consider and remind giving the best policy for local entrepreneurs. This condition will also make foreign investors less and less. Because they move their capital to other countries which will be based of production to Indonesia market.

This case will presure Indonesia export to market yet import of goods from overseas wellcome more and more.

If this case continues, just one up to two years Indonesia will become consumer country. Economy stays growing up, but it is no quality.