Can We Called Indonesia as a Developed Country?

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Author: Jesica Millenia

The United States (US) government has decided to remove a number of countries from the list of developing countries eligible to special differential treatments (SDT), including Indonesia.  As per February 10, 2020, the US officially through the Office of the US Trade Representative (USTR) in the World Trade Organization (WTO) announced that Indonesia is removed from the list of Developing and Least-Developed Countries (LGDCs), together with South Korea, Thailand, Singapore and Vietnam, India, China, and South Africa. Many economists say that this removal will not complicate Indonesia’s trade position, as Donald Trump’s trade policy right now does not put Indonesia as its main target, but rather as a means to reach its main target, which is more tariff for the Chinese goods. By removing Indonesia and other countries from the LGDCs list, the US will be able to to apply anti-dumping duties or countervailing duties more (CVD) to Chinese goods, the real target of US current trade policy.

In the way that US removed Indonesia as developing countries for its interest against China, we can’t really say that Indonesia has become a developed country. The way Indonesia receives benefits from the GSP and classification as a ‘developed nation’ by the US is not an indicator of progress. The revocation of Indonesia’s developing country status does not mean we have moved up the development ladder but it defines Indonesia’s future trade relationship with the US. The reclassification does not indicate a rise in Gross National Income (GNI) or other social development indicators such as healthcare and education which is a determining factor whether the country can be called a developed country or not. Again, it could be only a US strategy to revoke the status as a developing country is part of a trade war strategy that is being waged by developed countries. In the end, by looking at the reality, Indonesia still not ready to be called as a developed country.


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