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IndonesiaChicken: Tensions between International Trade and Domestic Food Policies?

Published online by Cambridge University Press:  05 April 2019

BORIS RIGOD
Affiliation:
Hausfeld
PATRICIA TOVAR
Affiliation:
Pontificia Universidad Católica del Perú
Corresponding

Abstract

This paper analyzes the dispute Indonesia – Measures Concerning the Importation of Chicken Meat and Chicken Products from a legal-economic perspective. We evaluate alternative explanations for the motive behind Indonesia's import restrictions and conclude that they can be linked to protectionist political-economic motives and are most likely due to a self-sufficiency objective and the legal requirements attached to it. Economically, the import restrictions on chicken and other food products have led to substantial price volatility, and they impose costs on Indonesian consumers and small farmers who are net buyers of food, firms that import certain raw materials, as well as foreign exporters. Therefore, by making food more expensive and less accessible, they could reduce food security. We also argue that an additional issue with the goal of self-sufficiency in Indonesia is lack of comparative advantage in some food items, including chicken meat and chicken products. Legally, although the Panel highlighted that self-sufficiency is a legitimate policy objective that as such does not lead to a violation of WTO law, the Indonesia–Chicken case leads to the question of whether, in practice, it is feasible to implement a self-sufficiency target resorting only to WTO-compliant policies. Finally, we discuss potential alternative economic policies and examine whether Indonesia could have attained its food self-sufficiency objective in a WTO-consistent manner.

Type
Original Articles
Copyright
Copyright © Boris Rigod and Patricia Tovar 2019 

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Footnotes

We thank Juan Martín Mesía for excellent research assistance, and Robert Howse and participants at the WTO Case Law of 2017 Conference for comments.

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