November 30, 2020

US Dairy Benefits in Trade Agreement

US Dairy Benefits in Trade Agreement

Recently, the United States Trade Representative (USTR) reviewed Indonesia’s Generalized System of Preferences (GSP) status. USTR announced the conclusion of its review of Indonesia’s eligibility to continue receiving preferential tariff access to the U.S. market under the GSP program, which resulted in the US to hold Indonesia accountable for current issues holding back the smooth flow of US dairy exports.

The US dairy industry has commended the USTR for the benefits dairy will encounter due to the review. “The U.S. dairy industry and all of its supplying dairy farmers rely on the enforcement of fair-trade rules. We appreciate the work invested by the U.S. government to use the GSP review process to ensure that Indonesia complies with its trade obligations under the terms of the GSP program,” said Jim Mulhern, President, and CEO of the National Milk Producers Federation (NMPF). “This outcome demonstrates how the GSP review process can be utilized to scrutinize a country’s compliance with the program and to achieve improvements in U.S. market access where changes are needed. We look forward to working with both governments to ensure that all U.S. exporters eager to ship to Indonesia have the ability to do so smoothly.”

In 2018, NMPF and the US Dairy Export Council (USDEC), along with other organizations, filed a complaint with the USTR regarding Indonesia’s GSP compliance. The complaint cited its law mandating local partnership arrangements in order to secure import licenses. Indonesia removed that requirement in response to dairy’s concerns raised through the GSP process.

“We appreciate USTR ensuring that Indonesia meets its market access obligations under the GSP review process. Through that process, USTR helped address Indonesian policies that had endangered U.S. dairy exports to Indonesia, one of our largest markets. The government of Indonesia has been responsive to these concerns, and we look forward to building further upon this positive development,” said Tom Vilsack, President, and CEO of USDEC.