MINISTER OF TRADE REQUEST GSP TRADE RELATED

UNCLAS JAKARTA 007662

SIPDIS

SENSITIVE
SIPDIS

STATE FOR EAP/MTS; EB/TPP/BTA/ANA
USTR FOR DKATZ AND BWEISEL

E.O. 12958: N/A
TAGS: ETRD ECON PREL ID
SUBJECT: MINISTER OF TRADE REQUEST GSP TRADE RELATED
EARTHQUAKE ASSISTANCE


1. (SBU) Embassy recieved on June 15 the following letter
from Minister of Trade Mari Pangestu to USTR Susan Schwab
requesting that the U.S. Government consider providing
termprary GSP access for textile and garment companies in
areas affected by the May 27 earthquake in the regions of
Jogjakarta and Central Java.


2. (SBU) BEGIN TEXT OF MINISTER OF TRADE'S LETTER

Minister of Trade of the Republic of Indonesia
Our Ref. No. 507 /M-DAG/6/2006 Jakarta, 13 June 2006

H. E. Ambassador Susan C. Schwab
US Trade Representative
Washington, D. C.
U.S.A.

Dear Ambassador Schwab,
As I am sure you are aware, the recent earthquake in central
Java has had a devastating effect on the social and economic
fabric of the region. Our Government has just launched a
three month state of emergency.

The causalities figures are very substantial with severe
damage to infrastructure, manufacturing complexes, and retail
and distribution outlets. From the perspective of the
Ministry of Trade, we are urgently focusing efforts to try to
reopen markets so that essential foods can again be traded.

We are most grateful for the support shown by foreign donors
and in particular the willing and spontaneous assistance
provided by the US Government. Our Government is also relying
heavily on the manufacturing base in the region to assist in
the relief process. Most of these companies have temporarily
closed down to focus their efforts on helping the population
in the immediate environment by providing temporary shelter,
blankets and food. The efforts of these companies are
significant and instrumental in relieving the pain and
distress in those areas where the relief efforts have still
not reached.

The manufacturing base in the region affected comprises of
furniture, handicraft industries such as silverware, textiles
and garment. In discussing the relief effort with the
Indonesian Textile Associations (API),I was informed that
over 80 of their member companies are affected by the
earthquake and this figure will be higher as not all textile
and garment companies are members of the
API.

Bearing in mind the devastating effect of the earthquake and
the key role being played by companies in the relief effort,
I wish to request the US Government to consider provide
temporary GSP access for textile and garment companies in the
affected regions. This temporary access would not only
contribute to the recovery process of the companies affected,
but it would also represent a form of acknowledgement of the
efforts they have made in trying to restore some form of
normality in their immediate environment.

I do not believe that this temporary access would lead to a
surge in exports that would damage the US industry in that
our own manufacturing base is overshadowed by Asian
neighbours and the region of Central Java represents a
relatively small portion of the overall capacity of the
textile and garment industries in Indonesia.

I am most willing to provide all the information to support
this request for temporary access for GSP treatment. I do
look forward to hearing from you as soon as possible.

Sincerely yours,
Mari Elka Pangestu

CC: Ambassador of the Republic of Indonesia to the USA
Washington, D.C.

END TEXT MINISTER OF TRADE'S LETTER
AMSELEM