Response to the Plenary Session of
The Indonesian House of Representatives (DPR RI)
Jakarta, August 31, 2022 – The Civil Society Coalition for Economic Justice condemned the plenary session of the Indonesian House of Representatives on August 30, which ratified two Free Trade Agreements, namely, the Regional Comprehensive Economic Partnership (RCEP) and the Indonesia-Korea CEPA (IK-CEPA) agreement. The two agreements that were ratified are likely to have a wide impact on the lives of the Indonesian people. However, sadly in the process of discussion until the ratification of the treaty is not democratic and involves broad public participation. Not involving public participation in the international treaty process has violated the 1945 Constitution and Law no. 24 of 2000 concerning International Agreements j.o Constitutional Court Decision No. 13/PUU-XVI/2018 on International Agreements.
Indonesia for Global Justice (IGJ) revealed that, “Since the beginning of the discussion process until the ratification of the RCEP agreement, democratic process and public participation were lacking in discussion. In fact, several times we sent letters to the Indonesian House of Representatives to discuss the RCEP agreement and other international treaty hearings did not receive a positive response. This is quite unfortunate, because later this international agreement will have a broad impact on the people and there will be changes to national regulations. So the impact is quite large, directly or indirectly. For that, there should be room for public participatory in democracy way in every international agreement process,” said Rahmat Maulana Sidik, Executive Director of Indonesia for Global Justice (IGJ).
We also remind to the Indonesian House of Representatives for not immediately accept the proposal for ratification of international treaties that have been ratified by the Government of Indonesia. “The DPR RI should have been observant and carefully reviewed the contents of the agreement. It is even necessary for the DPR to conduct a study of the impact of human rights on international treaties before they are ratified into national law. This study is very important so that each international agreement does not violate human rights and other basic public rights,” added Maulana.
In fact, the House of Representatives of the Republic of Indonesia actually can reject international trade agreements that are endanger the national interest, this is stated in Article 84 Paragraph (6) of Law no. 7 of 2014 concerning Trade. For this reason, the Indonesian House of Representatives as a representative of the people must be wise and democratic in every process of international trade agreements only a stamp on the international agreement.
Gunawan, as the Senior Advisor in Indonesian Human Rights Committee for Social Justice (IHCS) emphasized that “international agreements that have a broad impact on the people should be interpreted as meaning that the DPR’s approval should be through public consultation to ensure that the international agreements ratified are in accordance with the principles of peace, independence and justice”, explained Gunawan.
RCEP’s Potential Impact on the People
On the issue of health and access to affordable medicines, this RCEP agreement will open up more space for companies to patent medicines that make medicine prices increasingly unaffordable.
Patent protection for pharmaceutical companies, not only under TRIPS or other FTA rules, can result in monopolistic practices on drug production and price, so that the availability of generic drugs will be delayed and hinder price competition due to the limited number of producers who can produce drugs.
“RCEP can jeopardize national interests, especially access to health and medicine, so it is better that a democratic and participatory process should be implemented so that affected communities and populations know what is being discussed”, Ferry from the Indonesia AIDS Coalition (IAC).
In the labor sector, the RCEP agreement is a real threat because workers will be faced with the RCEP arrangement on the Chapter on the Movement of People.
Herman Abdulrahman, Chairperson of Federasi Perjuangan Buruh Indonesia (FPBI) said that the Chapter on the Movement of People in RCEP will open the trend of Inter-Corporate Transfer (ICT) which uses foreign workers to support the efficient use of technology in Indonesia. However, in the end this rule will potentially result in employment problems such as; the failure of technology transfer, the decrease in employment opportunities in Indonesia due to the entry of workers from abroad for the liberalized sector, limited the potential of workers that only based on certification, will not support the transfer of technology to Indonesian workers, “said Herman.
In fact, from the total wage employment (pekerja upahan) for approximately 47 million, approximately 22 million are informal workers without a written contract, 15 million contract workers, and 10 million are permanent workers. That proportion alone is filled with the majority of informal workers, even that there are indications of underestimation of the number of formal workers in Indonesia. According to a Sakernas/World Bank survey, around 40% of wage employment categorized by BPS as ‘formal workers’ do not have written work contracts/informal workers. It is conceivable that foreign workers will also enter in the midst of a booming and unabsorbed supply of workers –premature deindustrialization– which is still happening in Indonesia.
Of course, cooperation to bring in investment is good, but if you close your eyes, then the important thing is to make the policy first. And do not look whether the business has growth-potential, or do joint ventures, local content policies, or technology transfers, also see whether the productivity is high or low? Obviously it is a disaster for workers in Indonesia.
“To be able to compete in services trade, of course, from RCEP, Indonesia must produce skilled workers, this is because the trend of incoming investment is always accompanied by technology that is not controlled by Indonesian workers. It means the foreign company will use its own workforce in operating the technology. The ability to maximize RCEP requires quality human resources including education”, said Herman.
Moreover, farmers in rural areas will also feel the negative impact of RCEP. Afgan Fadilla, Head of the Kepala Badan Kampanye Hak Asasi Petani Serikat Petani Indonesia stated that RCEP would certainly increase food imports into Indonesia.
In addition, this agreement has the potential to reduce farmers’ control over seeds triggered by intellectual property regulations that are in line with the World Trade Organization (WTO) and International Union for the Protection of New Varieties of Plants (UPOV). As a result, dependence on international market mechanisms and corporations has deepened.
“Farmers in Indonesia are dominated by smallholders who only have a land area of no more than 0.5 ha of land. This condition will be exacerbated if farmers are forced to compete with imported foods such as sugar, meat and other processed foods. Seed cultivators are also in danger of being marginalized if the application of seed patents controlled by corporations. Furthermore, we must learn from the issue of palm oil and cooking oil where due to our dependence on international markets and corporations, people find it difficult to access cooking oil and smallholder farmers find it difficult to get a decent price,” concluded Afgan.
Rahmat Maulana Sidik – Direktur Eksekutif IGJ – email@example.com
Gunawan – Penasehat Senior IHCS – firstname.lastname@example.org
Ferry Norilla – Indonesia Aids Coalition (IAC) – email@example.com
Herman Abdulrohman – Ketua Umum FPBI – firstname.lastname@example.org
Afgan Fadilla – Kepala Badan Kampanye Hak Asasi Petani Serikat Petani Indonesia – email@example.com.