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Indonesia Files WTO Complaint against U.S. in Paper Anti-Dumping Dispute

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Indonesia has now officially filed a complaint with the World Trade Organization (WTO) as of this past month, because it says its coated paper shipped to the U.S. has become a target of punitive duties at the hands of the U.S. authorities. The U.S. has imposed a 20.13% anti-dumping tariff and a 17.94% countervailing tariff on Indonesia’s coated paper, which is normally used for high-quality print graphics. The duties, imposed since 2010, will this year be assessed to determine if they will be extended.

Indonesia stated the measures violated the WTO rules, including Anti-Dumping Agreement and the Subsidies and Countervailing (SCM) Agreement, according to a statement issued by the WTO this past Friday. Indonesia’s move was motivated, among others, by its allegation that the benchmark for pricing used by the U.S. to determine the duties was based on prices in another country, said Trade Ministry Trade Defense Director Oke Nurwan.

"We are adopting a precedent set by China, which has won an appeal in one of its trade disputes, as the reference for pricing in the case inquiry was based on prices in other countries," Nurwan told The Jakarta Post on Sunday.

Similar coated paper from China was also charged with anti-dumping and countervailing duties by the U.S. authorities. In May 2012, China took the case to the WTO’s Dispute Settlement Body and later appealed to the Appellate Body following an unfavorable result.

The levies imposed on Indonesia’s coated paper have reportedly impacted major Indonesian producers PT Pabrik Kertas Tjiwi Kimia, PT Pindo Deli Pulp and Paper Mills, and PT Indah Kiat Pulp and Paper, grouped under pulp and paper giant Asia Pulp and Paper. The duties imposed have effectively lowered the shipment of glossy paper, which is generally employed in printing multi-colored graphics for catalogues, books, magazines, envelopes, labels, wrapping paper, and greeting cards, from $69.6 million before 2010 to a reported $16.7 million currently, according to data from the country’s Trade Ministry.

The U.S. must address the request within 60 days and if consultations fail to settle concerns, Indonesia can progress the case into a formal trade dispute.

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