TOKYO, June 1 (Bernama-BUSINESS WIRE) — ASEAN-Japan Centre (AJC) issued the 7th paper of the “Non-Equity Modes of Trade in ASEAN: Promoting new forms of trade between Japan and ASEAN” series focusing on Indonesia in March 2021. The findings of the paper were presented in the “Webinar on Non-Equity Modes of Indonesia” by AJC held on May 27, 2021. According to the paper, non-equity modes (NEMs) of trade in Indonesia is foreseen to potentially play a role in expanding opportunities to participate in global value chains and are critical for inclusive economic development especially in the COVID-19 pandemic.
Indonesia is the seventh largest economy in the world, and one-third of its economy is contributed by investments. NEMs in Indonesia exists in natural rubber industries in the form of contract farming, in footwear industry through outsourcing and subcontracting, in fast-food and convenience stores through franchising, and in international hotel chains through management contracts or licensing agreements. The recent passage of Law number 11 of 2020 on Job Creation aims to ease the main obstacles to investing in Indonesia, and benefits also NEMs by attracting investors to Indonesia with the expected ease of doing business in the country.