Media: Indonesia – UAE trade pact took effect in September.
On the other hand, players in the petrochemical market do not expect the free trade agreement to have a major impact on the market.
According to media reports, Indonesia’s Comprehensive Economic Partnership Agreement (CEPA) with the United Arab Emirates (UAE) came into effect on 1 September 2023 after the two nations signed the pact in July last year. The trade agreement marks Indonesia’s first with a Gulf country.
The trade pact erases 99 per cent of the existing tariff and would allow Indonesia to increase service exports to the UAE by 6%.
In 2022, the bilateral trade between the two countries reached USD 5 billion, an increase of 20% from the previous year. Indonesia hopes to double its trade volume in the next three years.
On the other hand, players in the petrochemical market do not expect the free trade agreement to have a major impact on the market. Even though Indonesia progressively reduces import duty from the previous 10% to 0% by 2027, the country imposes a specific quota, which is entitled to the lower import duty. The approved annual quota is too minor to have a major impact on the local market. Besides, the import of PP block copolymer from UAE is now under anti-dumping investigation in Indonesia.
The table below details the scheduled tariff cuts on the import of petrochemical products from the UAE to Indonesia and the approved annual quota.
|
HS Code |
Description |
2023 |
2024 |
2025 |
2026 |
2027 |
|
Combined and reported by CommoPlast |
||||||
|
3901.10.12 |
Polyethylene containing 5% or less alpha-olefin monomers |
8% |
6% |
4% |
2% |
0% |
|
3901.10.19 |
Other than polyethylene containing 5 % or less alpha-olefin monomers |
8% |
6% |
4% |
2% |
0% |
|
3901.10.92 |
Polyethylene containing 5% or less alpha-olefin monomers |
8% |
6% |
4% |
2% |
0% |
|
3901.10.00 |
Other Polyethylene containing 5% or less alpha-olefin monomers |
8% |
6% |
4% |
2% |
0% |
|
3901.30.00 |
Ethylene-vinyl acetate copolymers |
4% |
3% |
2% |
1% |
0% |
|
3901.90.40 |
Ethylene polymers, in primary forms, other than 3901.10 - 3901.40, in dispersion |
4% |
3% |
2% |
1% |
0% |
|
3901.90.90 |
Ethylene polymers, in primary forms, other than 3901.10 - 3901.40, other than in dispersion |
4% |
3% |
2% |
1% |
0% |
|
|
|
|
|
|
|
|
|
3902.10.30 |
Polypropylene in resins/dispersion |
8% |
6% |
4% |
2% |
0% |
|
3902.10.40 |
Polypropylene, in primary forms: Granules, pellets, beads, flakes, chips and similar forms |
8% |
6% |
4% |
2% |
0% |
|
3902.10.90 |
Polypropylene in other forms |
8% |
6% |
4% |
2% |
0% |
|
3902.20.00 |
Polyisobutylene, in primary forms |
4% |
3% |
2% |
1% |
0% |
|
3902.30.30 |
Propylene copolymers, in primary forms of liquids or pastes |
4% |
3% |
2% |
1% |
0% |
|
3902.90.10 |
Chlorinated polypropylene of a kind suitable for use in printing ink formulation |
4% |
3% |
2% |
1% |
0% |
|
3902.90.90 |
Chlorinated polypropylene in otherforms |
4% |
3% |
2% |
1% |
0% |
|
|
|
|
|
|
|
|
|
|
Quota / K tons |
33K tons |
200K tons |
300K tons |
400K tons |
521.5K tons |