L/C Obligation Only For Export Above US$ 1 Million

Kalimantan Coal

L/C Obligation Only For Export Above US$ 1 Million

Jakarta – TAMBANG. After discussing with stakeholders, the Ministry of Trade finally revised the L/C obligation policy of exported goods. The obligation to use Letter of Credit (L/C) would apply only for mining products, tin, and CPO export product worth over US$ 1 million. The implementation would also be delayed until April 2009.The decision was announced by the Minister of Trade, Mari Elka Pangestu, during a press conference on 5 March 2009. The meeting was also attended by the Director of Foreign Trade – Ministry of Trade, Diah Maulida, and chairmen of numerous associations representing the business sector.The minister said that since the Ministerial Regulation No.1/M-DAG/PER/1/2009 on L/C obligation effective on 5 January 2009, the ministry has been receiving inputs on the difficulties faced by business actors in implementing the rule. Furthermore, the policy was applied in the midst of global crisis, resulting in the drastic decline on export performances.Therefore, the Ministry of Trade has done a revision on the policy, by setting the obligation only for mining products, tin, and CPO. “Those three products are considered to have better bargaining position for buyers abroad,” the minister affirmed.Other revision related to the value, was that the L/C obligation would only apply for those three product worth over US$ 1 million. “We will also postpone the implementation until April 2009,” she explained.Previously, the Ministry of Trade has decided that the implementation would be commenced in two month following the issuance of Ministerial Regulation No.1/M-DAG/PER/1/2009. However, due to the loads of complaints from middle scales exporters and the worsening external economic condition, the policy needed a revision.

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