Strengthening Technical Regulation Cooperation with Indonesia, a Key Partner in the New Southern Policy

The Korean government delivering 32,000 PCR test kits for COVID-19 to the Indonesian government on April 24th.
Although the two countries signed the Comprehensive Economic Partnership Agreement (CEPA) last November, eliminating tariffs on major products, Indonesia has raised non-tariff trade barriers such as technical regulations.
(Photo by Yonhap News)

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[Asia Economy Reporter Moon Chaeseok] The government announced that it held a video conference of the Technical Regulation Authorities Consultative Council with Indonesia, a key trading partner in the New Southern Policy, on the 2nd.

The National Institute of Technology and Standards under the Ministry of Trade, Industry and Energy stated that the meeting was held to strengthen technical regulation cooperation with Indonesia.

On the Korean side, representatives from associations and organizations belonging to the Trade Technical Barriers (TBT) consortium, as well as major export companies such as POSCO and Samsung Electronics, participated.

On the Indonesian side, officials from the National Standardization Agency (BSN, Badan Standardsasi Nacional), which is equivalent to Korea’s National Institute of Technology and Standards, the Ministry of Industry, and the Ministry of Energy and Mineral Resources participated.

Indonesia has recently raised non-tariff barriers by expanding the certification items of the 'National Standard' (SNI, Standar Nasional Indonesia), which is equivalent to Korea’s 'KS' standard.

The National Institute of Technology and Standards organized the consultative council to proactively respond to Indonesia’s technical regulations and to disseminate the latest technical regulation trends to 577 Korean companies operating locally, including POSCO, Samsung C&T, and LG Electronics.

Through a bilateral meeting with Indonesia’s BSN, the institute requested improvements from the Indonesian side, such as ▲relaxing the post-certification management cycle of SNI certification ▲reducing the amount of product samples required during steel product certification reviews ▲improving the sample submission method for electrical and electronic products.

Specifically, they requested that Indonesia extend the SNI certification post-management factory inspections, which are currently conducted annually, to a three-year cycle, as is done in other countries.

They also asked to change the method where Indonesian inspectors visit factories to check samples and then send them to testing labs, to a method where companies send samples directly to the testing labs.

Additionally, the National Institute of Technology and Standards discussed ways to strengthen cooperation, such as regularizing consultative meetings with Indonesian technical regulation authorities, and obtained detailed information on Indonesia’s steel sector certification system through joint workshops.

On the 17th, a technical regulation briefing session will be held to listen to Indonesia’s recent technical regulation trends, inquire about plans for new regulations, and create an opportunity to preemptively resolve export difficulties related to trade technical barriers.

Regulation response officers from domestic export companies such as Samsung Electronics, LG Electronics, and Hyundai Motor Company (Hyundai Motor) are expected to participate in the briefing session.

On the Indonesian side, officials from the Ministry of Energy and Mineral Resources, Ministry of Information and Communication, and Ministry of Transportation will attend and explain topics such as ▲energy efficiency regulations for home appliances ▲mandatory biodiesel policies ▲certification systems for wired and wireless communication devices ▲automobile fuel efficiency standards.

Lee Seung-woo, head of the National Institute of Technology and Standards, said, "This Technical Regulation Authorities Consultative Council is expected to serve as a catalyst to strengthen mutual regulatory cooperation with Indonesia, a central country in the New Southern Policy and Korea’s seventh-largest trading partner." He added, "We will proactively resolve difficulties faced by our export companies through continuous technical regulation cooperation with target countries for trade expansion, including New Southern countries."

Indonesia, with a population of about 260 million, is the largest among the 10 ASEAN (Association of Southeast Asian Nations) countries and has great market potential.

The trade volume between Korea and Indonesia is also continuously expanding. Korea’s exports to Indonesia increased by about 15.8%, from $6.608 billion in 2016 to $7.65 billion last year.

Although Korea and Indonesia signed the Comprehensive Economic Partnership Agreement (CEPA) on November 25 last year, eliminating tariffs on steel products for automotive steel sheets, petrochemical products, synthetic resins, and textile products, Indonesia has been strengthening non-tariff trade technical barriers through technical regulations.

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