Indonesia is the largest Muslim country in the world. Would a free trade agreement (FTA) with the country be beneficial both economically and politically to the United States? What kind of benefit could Indonesia expect? This book presents a case for improved trade relations between Indonesia and the United States and recommends advancing exploratory talks toward a US-Indonesia FTA. The authors present a detailed study of the stakes involved in the various areas of the proposed negotiation and estimate the FTA's potential for trade creation, trade diversion, and welfare under different scenarios.
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According to Hufbauer (former professor of international finance diplomacy, Georgetown U.) and Rahardja (an economist for the East Asia and Pacific Region at the World Bank), the forging of a bilateral free trade agreement between Indonesia and the United States promises large economic benefits for the former and political benefits for the latter and also may help spur reform in Indonesia. They analyze the potential impacts of such a trade agreement, looking at such issues as the commercial importance and strategic value of bilateral merchandise trade, labor and environmental issues, investment links and intellectual property rights, trade in services, and econometric estimates of potential two-way trade expansion. Annotation ©2007 Book News, Inc., Portland, OR (booknews.com)
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