The Indonesian government has set off on a track of increased self-sufficiency. Strong-rupiah policy, anti-foreign sentiments and increased Chinese competition have moved the Indonesian president Joko Widodo towards protectionism.
The Indonesian government has, as part of this policy, reduced a lot of its fruit import quotas. The thought is that there is no need to import (exotic) fruits that are grown in Indonesia.
This development is hitting the Chinese export market hard. Indonesia is one of the largest importers of Chinese citrus, particularly mandarins. In the past, an estimated 70% of total mandarin export was destined for Indonesia. A citrus export manager from Shenzhen comments: “Indonesia might be closing the door for Chinese fruit exports. The new import restrictions have come down very hard on the market. Most exporters received a notice last September. Since then the future has been insecure. 20% of our trade comes from exports to Indonesia. These have almost stopped in the last weeks.”
Critics claim that the import restrictions do more harm than good. Indonesia is not self-sufficient in terms of fruit and citrus production and the policy might lead to shortages on the local market.
Weak Chinese fruit market
“The Chinese domestic fruit market has been slow since last year. The general economy is not performing strongly, and this noticeably so in the fresh fruit trade. The market during the Chinese New Year, usually one of the busiest periods of the season, has been poor too.”
“The export market is not gaining speed. As a result, more exporters have changed to import. This has increased competition, bringing down margins in a dwindling market place."
