IDEAS home Printed from https://ideas.repec.org/a/sae/emeeco/v14y2022i2p204-221.html
   My bibliography  Save this article

The Art of Trade War: Spurring Investments in Indonesia Amidst the US–China Trade War

Author

Listed:
  • Hilda Yanuar Jong

Abstract

The US–China trade war creates significant opportunities for developing countries, as global manufacturers need to relocate their production facilities out of China to avoid future tariff hikes. However, Indonesia as the biggest economy in the ASEAN is not experiencing any substantial advantage relative to its neighbors, especially compared to Vietnam. While there is no clarity on how long the trade war will last, it is important for Indonesia to strategize quickly to capitalize the opportunities. This article addresses the question of how Indonesia should strategize through country comparison and analysis of two types of policy competition, namely, incentives-based (IBC) and rules-based competition (RBC). In the short-term, Indonesia should be more accommodating for investors of all sizes and maximize the trade-related investment assistance. In the longer term, Indonesia should prudently open up to trade, improve cooperation between investment and trade functions, and build a positive public mindset for free trade.

Suggested Citation

  • Hilda Yanuar Jong, 2022. "The Art of Trade War: Spurring Investments in Indonesia Amidst the US–China Trade War," Global Journal of Emerging Market Economies, Emerging Markets Forum, vol. 14(2), pages 204-221, May.
    • Handle: RePEc:sae:emeeco:v:14:y:2022:i:2:p:204-221
    DOI: 10.1177/09749101211034110
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/09749101211034110
    Download Restriction: no
    File URL: https://libkey.io/10.1177/09749101211034110?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Adrian Corcoran & Robert Gillanders, 2015. "Foreign direct investment and the ease of doing business," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 151(1), pages 103-126, February.
    2. Danielle le Clus-Rossouw & Wilma Viviers & Elsab� Loots, 2015. "Is there a link between BRIC foreign direct investment and SADC export performance?," Development Southern Africa, Taylor & Francis Journals, vol. 32(6), pages 658-674, November.
    3. Alberto Alesina & Silvia Ardagna & Giuseppe Nicoletti & Fabio Schiantarelli, 2005. "Regulation And Investment," Journal of the European Economic Association, MIT Press, vol. 3(4), pages 791-825, June.
    4. Panagiotis Liargovas & Konstantinos Skandalis, 2012. "Foreign Direct Investment and Trade Openness: The Case of Developing Economies," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 106(2), pages 323-331, April.
    5. Collie, David R., 2011. "Multilateral trade liberalisation, foreign direct investment and the volume of world trade," Economics Letters, Elsevier, vol. 113(1), pages 47-49, October.
    6. Li, Zhongmin, 2013. "How Foreign Direct Investment Promotes Development: The Case of the People’s Republic of China’s Inward and Outward FDI," ADB Economics Working Paper Series 304, Asian Development Bank.
    7. World Bank, 2020. "Doing Business 2020," World Bank Publications - Books, The World Bank Group, number 32436.
    8. Christan RA Setyobudi & Dyah Setyaningrum, 2019. "E-Government And Corruption Perception Index: A Cross-Country Study," Jurnal Akuntansi dan Auditing Indonesia, Accounting Department, Faculty of Business and Economics, Universitas Islam Indonesia, vol. 23(1), pages 11-20, Juni.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Raul Gouvea, 2020. "Brazil: Chartering a New Economic Pathway," International Business Research, Canadian Center of Science and Education, vol. 13(1), pages 145-160, January.
    2. Rafiou Raphaël Bétila, 2021. "The impact of Ease of Doing Business on economic growth: a dynamic panel analysis for African countries," SN Business & Economics, Springer, vol. 1(10), pages 1-34, October.
    3. Brandon Pizzola, 2018. "Business regulation and business investment: evidence from US manufacturing 1970–2009," Journal of Regulatory Economics, Springer, vol. 53(3), pages 243-255, June.
    4. Paul Holden & Alma Pekmezovic, 2020. "How accurate are the Doing Business indicators? A Pacific Island case study," Asia and the Pacific Policy Studies, Wiley Blackwell, vol. 7(3), pages 247-261, September.
    5. Nicky Rogge & Alena Kolyaseva, 2022. "Measuring and comparing World Bank regions’ ‘ease of doing business’ opportunity sets," Journal of Productivity Analysis, Springer, vol. 57(2), pages 131-155, April.
    6. Martins, João & Veiga, Linda Gonçalves, 2022. "Digital government as a business facilitator," Information Economics and Policy, Elsevier, vol. 60(C).
    7. Contractor, Farok J. & Nuruzzaman, N. & Dangol, Ramesh & Raghunath, S., 2021. "How FDI Inflows to Emerging Markets Are Influenced by Country Regulatory Factors: An Exploratory Study," Journal of International Management, Elsevier, vol. 27(1).
    8. Stanley Tweyman, 2022. "The Two Truths that Descartes Discovers in His Meditations on First Philosophy that Do Not Require the Divine Guarantee," European Journal of Social Sciences Articles, Revistia Research and Publishing, vol. 5, January -.
    9. Balázs Égert, 2018. "Regulation, Institutions and Aggregate Investment: New Evidence from OECD Countries," Open Economies Review, Springer, vol. 29(2), pages 415-449, April.
    10. Balázs Égert, 2016. "Regulation, Institutions, and Productivity: New Macroeconomic Evidence from OECD Countries," American Economic Review, American Economic Association, vol. 106(5), pages 109-113, May.
    11. Fernando Castelló-Sirvent & Pablo Pinazo-Dallenbach, 2021. "Corruption Shock in Mexico: fsQCA Analysis of Entrepreneurial Intention in University Students," Mathematics, MDPI, vol. 9(14), pages 1-31, July.
    12. Bouët, Antoine & Elbehri, Aziz & Nguyen, Duc Bao & Traoré, Fousseini, 2022. "Measuring Agricultural Trade Integration in Southeast Asia," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 37(2), pages 235-266.
    13. Balazs Egert, 2022. "Public policy reforms and their impact on productivity, investment and employment: new evidence from OECD and non-OECD countries," Public Sector Economics, Institute of Public Finance, vol. 46(2), pages 179-205.
    14. Forni, L. & Gerali, A. & Pisani, M., 2010. "Macroeconomic Effects Of Greater Competition In The Service Sector: The Case Of Italy," Macroeconomic Dynamics, Cambridge University Press, vol. 14(5), pages 677-708, November.
    15. Fabiano Schivardi & Eliana Viviano, 2007. "Entry barriers in Italian retail trade," Temi di discussione (Economic working papers) 616, Bank of Italy, Economic Research and International Relations Area.
    16. Da Rin, Marco & Di Giacomo, Marina & Sembenelli, Alessandro, 2011. "Entrepreneurship, firm entry, and the taxation of corporate income: Evidence from Europe," Journal of Public Economics, Elsevier, vol. 95(9), pages 1048-1066.
    17. Sèna Kimm Gnangnon, 2020. "Trade Openness and Diversification of External Financial Flows for Development: An Empirical Analysis," South Asian Journal of Macroeconomics and Public Finance, , vol. 9(1), pages 22-57, June.
    18. Adeline Saillard & Thomas Url, 2011. "Venture capital in bank - and market - based economies," Documents de travail du Centre d'Economie de la Sorbonne 11025, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
    19. R. Nahuis & H. van der Wiel, 2005. "How Should Europe’s ICT Ambitions look like? An Interpretative Review of the Facts," Working Papers 05-22, Utrecht School of Economics.
    20. Andrea Lasagni & Annamaria Nifo & Gaetano Vecchione, 2015. "Firm Productivity And Institutional Quality: Evidence From Italian Industry," Journal of Regional Science, Wiley Blackwell, vol. 55(5), pages 774-800, November.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:emeeco:v:14:y:2022:i:2:p:204-221. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: http://www.emergingmarketsforum.org/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.