Indonesia Efta Free Trade Agreement

• If these criteria are not met, imported palm oil cannot benefit from the preferential conditions of the agreement. • The agreement improves legal certainty and planning certainty in economic relations with the emerging Indonesian economy and creates new opportunities for Swiss companies. • In the area of merchandise trade, Switzerland will be able to eliminate the current discrimination in favour of countries that already have trade agreements with Indonesia, such as Japan and Australia. Swiss companies will have a competitive advantage over competitors from countries that have not signed a free trade agreement with Indonesia, as Indonesian tariffs are relatively high. • The European Union is also negotiating an agreement with Indonesia. Swiss exporters are thus at risk of being discriminated against against their main competitors in the EU. • At the end of the tariff reduction deadlines, 98% of current Swiss exports to Indonesia will be exempt from customs duties. This will allow all Swiss exporters, both industrial and agricultural, to benefit from the agreement. • Based on the current level of trade, Swiss companies can save around CHF 25 million in customs duties when the deadlines for reducing customs duties expire. • The elimination of customs duties should open up new export opportunities for Switzerland, which are currently prevented by Indonesia`s high tariffs on industrial goods (average customs duties of 8%).

· When the deadline for reducing customs duties expires, Swiss companies will be able to save CHF 25 million per year on the basis of ongoing trade. In addition, Swiss concerns to ensure sustainability have been fully taken into account: firstly, the agreement contains provisions on trade and sustainable development, which are also directly relevant for palm oil production. These include the obligation to respect and implement multilateral environmental policies and to respect the fundamental rights of workers. In addition, the agreement includes provisions to promote the sustainable management of forest resources, including by combating illegal logging. Secondly, EFTA has reached agreement on a specific provision for palm oil. This provision provides for broader commitments to ensure sustainable production and trade in palm oil and other vegetable oils. In addition, the agreement contains a chapter on trade and sustainable development. It contains provisions on respect for and implementation of multilateral environmental agreements and on fundamental workers` rights. In addition, the agreement contains provisions to promote the sustainable management of forest resources as well as a provision on the sustainable management of the vegetable oil sector.

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