Palm Oil Safe From Saudi Arabia’s Trade Policy

A number of Indonesia’s top export products, including crude palm oil (CPO), are safe from the trade policy of Saudi Arabia, which raised the import tariffs of 575 imported products on 18 June 2020.

Indonesian trade ministry’s National Export Development Director General Kasan said in a press release on Tuesday that Saudi Arabia exempted the Indonesia’s palm oil and derivative products, together with other several Indonesian products, from the trade policy application. Other Indonesian export products safe from the policy are wood products, meat and fish, vitamin products, seafood, rice, vegetables, fruits, and other products that can strengthen human immunity during the outbreak of Coronavirus (Covid-19) pandemic.

“We have to maximize this market opportunity to increase our top export products that are excluded from the trade policy,” Kasan said in a press release on Tuesday.

Saudi Arabia had decided to increase the import tariffs of several products by between 5.0 and 20 percent. The automotive products are slapped with an import tariff of 7.0 percent as compared to the previous tariff at 5.0 percent, paper and derivative products at 8.0 and 10 percent as compared to 5.0 percent previously, iron/steel and various products of iron/steel at between 8.0 and 20 percent as compared to only 5.0 percent previously.

During the period of January—April 2020 total trading of Indonesia – Saudi Arabia reached US$1.55 billion. In 2019, the total trading value between the two countries amounted to US$5.07 billion as compared to US$6.13 billion in 2018.

Indonesia’s exports to Saudi Arabia during January – April 2020 reached US$519.86 million. In 2019,  Indonesia’s total exports to Saudi Arabia reached US$1.50 billion and in 2018 at US$1.22 billion. Indonesia’s main exports to Saudi Arabia are palm oil and derivative products, fishes, automotive, woods products, rubber, and paper.

Saudi Arabia decided to increase the import tariffs as a way to compensate the decrease of its state income as a result of the drop of oil prices at the global market. (*)

Source: Bisnis.com

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