Indonesia’s Local Content Requirements: An Assessment on Consistency with Free Trade Agreement Commitments
Local content requirements (LCRs) are one of several economic instruments used by governments to protect infant domestic industries or to generate employment. Indonesia has LCR policies in several sectors. However, LCRs are often inconsistent with a country’s World Trade Organization commitments. Additionally, free trade agreements could also have provisions that regulate LCRs. This paper assesses whether Indonesia’s free trade agreements have provisions on LCRs, and whether its regulations are consistent with them.