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RCEP and Indonesia: Economic Reform and Prospects for Implementation

Author

Listed:
  • Yose R. Damuri

    (Centre for Strategic and International Studies, Indonesia)

  • Deni Friawan

    (Centre for Strategic and International Studies, Indonesia)

Abstract

The conclusion of the Regional Comprehensive Economic Partnership (RCEP) is very important for Indonesia as it may bring many benefits to the country. This paper is an attempt to see the role of domestic political-economy dynamics in facilitating and constraining Indonesia's decision to join, ratify, and implement a free trade agreement (FTA). It also seekssome understanding on whether an FTA can bring significant market liberalisation. This paper focuses on two areas of observation. First, it discusses the current progress of the legislative process and public acceptance of the RCEP agreement in Indonesia and how the process is influenced by the political economy dynamics of the country. Second, the paper also looks at the potential impacts of the agreement on Indonesia's current reform agenda, especially the recently passed Jobs Creation Law (Law No. 11/2020). For these observations, we conduct a content analysis on RCEP-related news published in two newspapers in Indonesia, namely Kompas and the Jakarta Post. In addition to content analysis, we also conducted interviews with stakeholders, including parliament members and government officials from the Ministry of Trade who have been actively involved in RCEP negotiations and the ratification process. The paper provides some remarks and recommendations for the future agenda of RCEP ratification and implementation in Indonesia

Suggested Citation

  • Yose R. Damuri & Deni Friawan, 2023. "RCEP and Indonesia: Economic Reform and Prospects for Implementation," Working Papers DP-2022-38, Economic Research Institute for ASEAN and East Asia (ERIA).
    • Handle: RePEc:era:wpaper:dp-2022-38
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    References listed on IDEAS

    as
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    2. M. Chatib Basri & Arianto A. Patunru, 2012. "How to keep trade policy open: the case of Indonesia," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 48(2), pages 191-208, August.
    3. Milner, Helen V. & Kubota, Keiko, 2005. "Why the Move to Free Trade? Democracy and Trade Policy in the Developing Countries," International Organization, Cambridge University Press, vol. 59(1), pages 107-143, January.
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    More about this item

    Keywords

    RCEP ratification process; economic reform; domestic political-economy dynamics; content analysis;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F15 - International Economics - - Trade - - - Economic Integration
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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