G/SG/N/8/IDN/30  
G/SG/N/10/IDN/30  
 
8 April 2021  
(21-2929) Page: 1/6 
Committee on Safeguards  Original: English  
 
 
NOTIFICATION UNDER ARTICLE 12.1(B) OF THE AGREEMENT ON  
SAFEGUARDS ON FINDING A SERIOUS INJURY OR THREAT  
THEREOF CAUSED BY INCREASED IMPORTS  
NOTIFICATION OF A PROPOSAL TO IMPOSE A MEASURE  
INDONESIA  
Expansible Polystyrene in the Form of Granule  
The following communication, dated  and received on 7 April 2021 , is being circulated at the request 
of the delegation of Indonesia . 
 
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Pursuant to Articles 12.1(b) of the Agreement on Safeguards, the Government of the Republic of 
Indonesia submits a notification on finding serious injury or threat thereof, to the domestic industries 
producing "Expansible Polystyrene  in the Form of Granule " and a notification of proposed safeguard 
measures. This notification contains all pertinent inf ormation relating to the proposed safeguard 
measures in accordance with Article 12.2 of the Agreement on Safeguards and an offer of 
consultations pursuant to Article 12.3 of the Agreement on Safeguards.  
A. GENERAL BACKGROUND  
1. Initiation of Investigation  
On 6 November  2020, an application for a safeguard measure s was received by the 
Investigating  Authority  from PT. Kofuku Plastic Indonesia (PT. KPI)  hereinafter referred  as 
"the Applicant ", against the importation of the product under investig ation. After examining the 
properly documented application, the Investigating Authority concluded that there was a sufficient 
evidence to justify the initiation of a safeguard investigation.  
Subsequently, on 18 November  2020, the Investigating Authority in itiated a safeguard investigation 
on the import of "Expansible Polystyrene  in the Form of Granule ". The commencement of the 
investigation was announced in the Bisnis Indonesia newspaper on 18 November  2020 and the 
Ministry of Trade's website on 18 November  2020 (G/SG/N/6/IDN/3 8) and 1 December 2020 
(G/SG/N/6/IDN/3 8/Suppl.1 ). 
2. Period of Investigation  
The period of investigation covers 2016 to 2019.  
3. Major Proportion  
The total production of the Applicant is 100% of the total domestic production of the Subject Goods. 
Therefore, it represents a major proportion as required by Article 4.1(c) of the WTO Agreeme nt on  
Safeguards.  G/SG/N/8/IDN/30 • G/SG/N/10/IDN/30  
 
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  Table 1. Major Proportion  
Companies  Proportion (%)  
PT Kofuku Plastic Indonesia  100 
National Production  100 
4. Views and Comments of the Interested Parties  
In accordance with Article 3.1 of the WTO Agreement on Safeguards, during the process of 
investigation, the Investigating Authority has provided opportunities to all interested parties, to 
submit their views, evidences, comments, and responses concerning t he investigation. In light of 
the aforementioned, the Investigating Authority has held a public hearing on 16 December  2020.  
B. INFORMATION ON WHETHER THERE IS AN ABSOLUTE INCREASE IN IMPORTS OR AN 
INCREASE IN IMPORTS RELATIVE TO DOMESTIC PRODUCTION  
In the light to provide evidence whether there is an absolute increase in imports or an increase in 
imports relative to domestic production, the Investigating Authority has analyzed  import data of the 
Subject Goods during the period of investigation.  
1. Absol ute increase in imports  
Table 2. Import Quantities  
Description  Unit Year Growth (%)  Trend 
% 
(2016 -
2019)  2016  2017  2018  2019  2016 -
2017  2017 -
2018  2018 -
2019  
Import 
quantities  Tons 23,867  26,451  27,712  30,312  10.82  4.77 9.38 7.94 
Source:  Statistics Indonesia/ Badan Pusat Statistik (BPS).  
The import quantities  increased each year from 23,867 tons  in 2016  to 26,451 tons  in 2017  or by 
10.82 % and increased to 27,712  tons or by 4.77% in 2018  and increased  again  to 30,312 tons or 
by 9.38% . During the period of 2016 -2019 imports increased in absolute terms with a trend of 
7.94%. 
2. Relative increase in imports to Total Domestic Production  
Table 3. Import Quantities , Total Domestic Production, and Relative to Total Do mestic 
Production  
Description  Unit Year Growth (%)  Trend %  
(2016 -
2019)  2016  2017  2018  2019  2016 -
2017  2017 -
2018  2018 -
2019  
Import quantities  Tons 23,867  26,451  27,712  30,312  10.82  4.77 9.38 7.94 
Total Domestic 
Production  Index  100 86.52  72.91  75.97  (13.48)  (15.72)  4.20 (9.48)  
Imports Relative 
to the Domestic 
Production  Index  100 128.10  159.25  167.17  28.10  24.31  4.98 19.23  
Source:  Statistics Indonesia and as verified by Investigating Authority.  
As seen in Table  3 above, there was a surge increased in imports relative to the national production 
during the investigation period, from 100 indexed points in 201 6 to 128.10  indexed points in 201 7, 
and increase to 159.25 indexed points  in 2018 and continued to increase to  167.17  indexed points 
in 201 9. During 201 6-2019, imports relative to the national production was increased with trend of 
19.23 %. G/SG/N/8/IDN/30 • G/SG/N/10/IDN/30  
 
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  3. Imports from Main Countries  
Table 4. Imports Shares  
Country  2019 
Volume ( Tons ) % 
Chinese Taipei  9,446  31.16  
Japan  7,629  25.17  
People 's Republic of China  4,984  16.44  
Viet Nam  2,520  8.31 
Thailand  1,572  5.19 
India 1,440  4.75 
Republic of Korea  1,339  4.42 
Other Countries  1,383  4.56 
World  30,312  100 
Source:  Statistics Indonesia/ Badan Pusat Statistik (BPS).  
From the table above, the biggest shares of import in 2019 was the Chinese Taipei , which its shares 
of import in 201 9 accounted for 31.16 %. Other countr ies with share of imports above 3% during 
2019 are Japan  (25.17 %), People 's Republic of China (16.44%), Viet Nam (8.31%), 
Thailand  (5.19%), India (4.75%), and the Republic of Korea ( 4.42%). 
4. Unforeseen Development  
The occurrence of an unforeseen development could not have predicted a surge in the number of 
imports of Subject Goods from the exporting countries, this was due to the existence of:  
a. The Increasing of the supply of  packaging products, constructions and building automotive to 
countries  in the Asia Pacific region. According to research data from Mordor Intelligence in 2019, 
it is known that in the previous period there had been an increase in the supply of the final 
products  of the Subject Good s, including being used for packaging, const ructions and automotive 
building from several producing countries to the Asia Pacific region including Indonesia. The 
increase in the supply of the final Subject Good s has resulted in an unexpected increase in the 
number of Indonesian Subject Goods.  
b. The  application of Integrated Goods and Services Tax (IGST) in India is 18% . The Government of 
India has implemented the IGST Act since July 1, 2017, whereby every imported the 
Subject  Goods entering India is subject to a tax rate of 18%. The application of t he IGST Act has 
a positive impact on the growth and development of India's Subject Good s industry and has a 
negative impact on exporters from other countries that want to export to India because they have 
to pay an additional tax rate of 18% so that these other countries shift their exports outside 
India, including Indonesia. With the increasing supply of the Subject Good s, it has prompted 
Indian Subject Good s exporters to increase their exports to several countries including Indonesia. 
This condition was u nexpected, resulting in a surge in the number of the Subject Good s entering 
the Indonesian domestic market.  
C. EVIDENCE  OF SERIOUS INJURY OR THREAT THEREOF CAUSED BY INCREASED 
IMPORTS  
In a view to determine the existence of serious injury or threat of serious  injury that is caused by 
increased imports, the Investigating Authority has analyzed and made an evaluation of all relevant 
factors in an objective and quantifiable natures. The following analyses are based on data provided 
by the Applicant, which has bee n verified by the Investigating Authority.  
1. Evidence of serious injury or threat of serious injury  
The general economic indicators related to Subject Goods  in the safeguard investigation are 
presented at the table below . G/SG/N/8/IDN/30 • G/SG/N/10/IDN/30  
 
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  Table 5 . National Consumption, Import Quantities , and Market Shares  
No. Description  Unit Year Trend %  
(16-19) 2016  2017  2018  2019  
1. National 
Consumption  Index  100 101.17  95.50  101.38  (0.16)  
2. Import quantities  Tons 23,867 26,451 27,712 30,312 7.94 
3. Applicant's 
Domestic Sales  Index  100 88.94  69.41  68.94  (12.75)  
5. Imports' market 
share  Index  100 109.55  121.58  125.27  8.11 
6. Applicant's 
market share  Index  100 87.91  72.68  68.00  (12.60)  
Source:  Statistics Indonesia and as verified by the Investigating Authority.  
Based on the table above, it can be concluded that the import market share has increased with a 
trend of 8.11% during the investigation period (2016 -2019). This resulted in the Petitioner's market 
share experiencing a decline with a trend of 12.60%. Thus, it can be concluded that during the 
investigation period (2016 -2019) the increase in the number of imports has taken the Applicant's 
market sha re. 
Table 6 . The Applicant's Indicators of Injury  
No. Description  Unit Year Trend  % 
(16-19) 2016  2017 2018 2019 
1. Production  Index  100 86.52  72.91  75.97  (9.48)  
2. Domestic Sales  Index  100 88.94  69.41  68.94  (12.75)  
3. Productivity  Index  100 93.01  83.61  93.34  (3.09)  
4. Utilization Capacity  Index  100 86.52  72.91  75.97  (9.48)  
5. Profit/Loss  Index  100 82.79  71.57  50.72  (19.62)  
6. Employment  Index  100 93.02  87.21  81.40  (6.59)  
7. Inventory  Index  100 60.75  191.52  427.63  73.45  
Source:  As verified by the Investigating Authority.  
As shown in Table above, the performance of the applicant can be seen as follows:  
a. The Applicant made the Subject Good s by order. During the peri od of investigation (2016 -
2019)  the Petitioner's production amount decreased with a quite significant trend of 9.48%. 
During the same period, domestic sales also experienced a downward trend of 12.75%, as 
a result of a surge increased imports with a trend of 7.94%.  
b. Productivity decrease d during the investigation period (2016 -2019) with a trend of 3.09%, 
as a result of decreased production and labor with a trend of 9.48% and 6.59%, respectively.  
c. With an overwhelming number of imported goods, the number of domestic sales was 
significantly eroded. It has an impact on decreasing company profits during the investigation 
period (2016 -2019) with a downward trend of 19.62%.  
d. The amount of ending inventory during the investigation period (2016 -2019) has increased 
with a trend of 73.45%, as a result  of the flood of imports with a trend of 7.94%.  
2. Other Factors That May Contribute to Injury  
In order to ensure that the serious injury is only caused by increased imports, the 
Investigating  Authority has examined the following other known factors:  G/SG/N/8/IDN/30 • G/SG/N/10/IDN/30  
 
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  a) Techn ology  
Based on the results of the investigation, the Applicant has the latest technology in producing the 
Subject Good s. This is supported by the fact that the applicant's machine is capable of producing 
the Subject Good s used for various kinds of the Subj ect Good s with the latest technology purchased 
from Chinese Taipei  and Japan. Therefore, the Petitioner's serious injury  were not caused by 
technology.  
b) National Production Capacity and National Consumption  
Table 7. Portion of National Consumption to the National Production Capacity  
Unit: % 
Description  Year 
2016  2017  2018  2019  
National Consumption to the National Production Capacity  96.22  97.34  91.89  97.55  
Source:  Ministry of Industry of the Republic of Indonesia . 
As shown in Table above, the national production  capacity is sufficient enough to meet the national 
consumption . In 2016 the national consumption  was 96.22 % of the national production  capacity. 
Meanwhile, national consumption in 201 7 was 97.34 % of the national production  capacity , national 
consumption in 201 8 was 91.89 % of the national production  capacity , and national consumption in 
2019 was 97.55 % of the national production  capacity . 
Based on the information  above, it can be concluded that  during the period of investigation  there 
were no other factors that caused a serious injury to the Applicant besides increased volume  of 
imports of the Subject Goods . 
3. Causal Link  
The Investigating Authority has examined all  relevant  factors having a bearing in the Applicant 
situation, and came into a conclusion that serious injury suffered by the Applicant mainly caused by 
significant increased volume of imports and not due to the other factors, as follows:  
a) There was a surge in im ports of the Subject  Goods either i n abso lute terms (7.94%) and relative 
terms  (19.23%).  
b) The import market share has increased with a trend of 8.11%.  This resulted in a decline in the 
market share of the Petitioner with a trend of 12.60%.  
c) There is a  downward trend in several performance indicators, including: production, domestic 
sales, productivity, used capacity, profit, labor, and increased inventories.  
D. DESCRIPTION OF THE PROPOSED SUBJECT GOODS  
Expansible Polystyrene in the Form of Granule , under Harmonized System  (HS.) code  
3903.11.10 . 
E. DESCRIPTION OF THE PROPOSED MEASURE  
In a view of the aforementioned findings, a safeguard measure has been proposed in form of 
ad valorem  duty with HS code , proposed date of introduction, and expected duration of the measure 
as follow:  G/SG/N/8/IDN/30 • G/SG/N/10/IDN/30  
 
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  Table 8 . The Proposed on Safeguard Measure s 
Period  Ad valorem  Duty  of Safeguard Measures  (%) 
First Year  12 
Second Year  11 
Third Year  10 
In a view of the aforementioned conclusion of the causal link, the Investigating Authority has 
proposed to the Government of the Republic of Indonesia to impose a safeguard measure on the 
importation of the Subject Goods for three periods . 
The imposition o f the safeguard measure s will be carried out in accordance with the Article 2.2 and 
Article 9 of the WTO Agreement on Safeguards.  
The non -confidential version of the Final Report of this investigation, can be found in the website of 
the Indonesian Safeguar d Committee: http://kppi.kemendag.go.id . 
F. PROVIDE PROPOSED DATE OF THE APPLICATION OF THE MEASURE  
The safeguard measure s is proposed to enter into force after the publication of the decree of the 
Minister of Finance of the Republic of Indonesia, which will be promulgated at the Official Gazette.  
G. CONSULTATIONS  
Members who have a substantial interest of the Subject Goods, sha ll submit a written request of 
consultation within a period of 7 days from the date of circulation of this notification . All written 
requests must be sent both in written letter and in electronic format, and must indicate the name, 
address, e -mail address,  phone  number  and fax number of the Members.  
In Accordance with Article 12. 3 WTO Agreement on Safeguard, the Government of the Republic of 
Indonesia is open for consultation in order to provide opportunities for those Members . The 
consultation is scheduled  to be held no later than 30 April 2021 . 
The contact information for correspondence is:  
DIRECTORATE OF MULTILATERAL NEGOTIATION, MINISTRY OF TRADE  
Jl. M.I. Ridwan Rais No.5, Building 2, 9th floor, Jakarta 10110  
Phone: (62 -21) 3840139  
Fax: (62 -21) 3840139  
E-mail: dit.multilateral.ppi@kemendag.go.id  
 
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