Indonesia has scrapped import duties on a number of raw materials and goods, including soyabean oil, in a drive to boost domestic manufacturing industries, a government official said. Soyabean oil, chemical feedstocks such as ethylene for plastics, and various machines for the textile and electronics industries were among 182 products that saw import duty scrapped from 5 percent previously, said Bambang Brodjonegoro, acting head of the fiscal office.
The government is trying to spur domestic industries to create higher value exports from a country that is a leading producer of raw materials such as crude palm oil, tin and thermal coal. It is seeing increasing foreign investment interest in sectors such as textiles and electronics. Indonesia from April is also raising import tariffs for eight food industry products and consumer goods, from 5 percent to 10 percent.
Chinese Premier Wen Jiabao is due to sign a series of agreements this week during a visit to Indonesia, covering everything from banking and energy to palm oil and infrastructure. In late January, Indonesia suspend import duties on soyabeans, rice and wheat as part of government efforts to fight inflation. Indonesia has been struggling to increase soyabean production to stop its reliance on imported soyabeans and aims to scrap soyabean imports by 2014. Indonesia soyabean imports are expected to be flat at 1.7 million tonnes this year.
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