ASEANChina Free Trade Area (ACFTA) / Critic & Solution By: Anastasia Winayanti The implementation of the ACFTA

on January 1, 2010 has caused many reactions and even controversy in the community. Almost all people tend to judge Indonesia was not ready for free trade, especially with China. From industry, the businessmen in the manufacturing sector took the fiercest action by demanding the government to do postponement of the deal. Among representatives of the people (Parliament), there was discussion about the planned formation of the working committee, or even a Special Committee, regarding this ACFTA agreement. For academics, Indonesias unpreparedness for ACFTA is not a new issue. Nonetheless, there is an urgency that requires the role of all circles to face these challenges. Indeed the steps needed to be very concrete, but still requires thinking from various circles, so that synergy can happen that accumulate into a positive movement to anticipate these ACFTA. The Government has decided to renegotiate tariffs on 228 postal votes had serious problems. Renegotiation of several important post is a short-term measures are indeed necessary, but something more fundamental is to prepare our economic competitiveness in the long term. In addition, no denying that most of our business sectors are the Medium, Small, and Micro Enterprises (UKM). Therefore, in order to face the ACFA, their role becomes very important. In the Global Competitiveness Index (GCI) from 2009 to 2010, Indonesia's ranking rose to 54th from 55th position in the GCI 2008-2009. Meanwhile, Malaysia is ranked 24th, Singapore 3, Thailand 36, China 29. Compared with other ASEAN countries, our competitiveness is relatively low. The low competitiveness does not happen instantly, but rather is the result of the evolution of industrial policy taken by the government long ago. In the Global Competitiveness Report 20092010 is explained that there are three main factors of Indonesias economic weakness. First, poor infrastructure (ranked 84th), especially ports (ranked 95) and road (rank 94). Second, the low level of public health, there are still many diseases characterized tuberculosis and malaria, as well as the high infant mortality rate. Third, technological readiness (ranked 88). It is necessary to form the Association of Business Centers / Industrial Products that are locally based to reinforce a sense of loving the superior product. A Superior Product is usually owned by a particular region and has a clear and loyal market. The government should form associations in the area of products, and its members are entrepreneurs who have similar products or derivatives. Each Association must be supported by increased marketing, more advanced ways, especially with the utilization of modern information technology such as Internet-based technologies.

There is much to be done by the government to secure the free trade. Firstly, the government can conduct early development of the monitoring system (Early Warning System) against the suspected products that will cause higher imports and a negative impact. Secondly, improve the investment climate and security at ports to prevent the smuggling (physical and administrative). Third, safeguards to maintain security and flexibility of national policy. Fourth, improve the supporting infrastructure for the industrial sector; reduce the high economic costs caused by longline permits, and others. Fifth, the policy rules of non-tariff barrier, the use Indonesian to imported products, Indonesian National Standard (SNI), and really pay attention to the quality of foreign products coming into Indonesia. Sixth, the exchange of product that is not ready with products that are ready, delay time and the modification of tariff intervals. Seventh, the increasing movement of products within the country. Another alternative, the government can renegotiate to modify some provisions. Moreover, entrepreneurs are also being challenged to be more innovative in facing the competition in the free market, especially in competition with Chinese products as the implementation of the ACFTA. Good entrepreneurs can certainly provide the latest innovations from the design of their products. Invent a completely different design unlike Chinese products, make it classier. The government will continue efforts to strengthen domestic industry in the face of a flood of cheap goods from China, namely by providing protection against unfair trade and the Indonesian National Standard. References: http://wartawarga.gunadarma.ac.id/2010/04/langkah-menghadapi-acfta/ http://andi.stk31.com/ide-untuk-menghadapi-acfta.html http://blog.ub.ac.id/johan/2010/07/03/china-asian-free-trade/ http://www.tempointeraktif.com/hg/bisnis/2010/07/05/brk,20100705-261000,id.html