Friday, May 19, 2006

The Politics of Shoes 1

What is really entertaining when we follow the attitude of businessmen is their split personalities.

Now it’s about shoes. Indonesian shoemakers are so happy that European Union imposes an antidumping policy to China and Vietnam. As a consequence of this policy, Timberland, Lotto, Diadora, Lacosta and probably more later are relocating their production to Indonesia.

But the EU’s policy is harmful. It is harmful for EU’s consumers even though it is beneficial for some producers (who are also consumers of other stuff), and it is harmful for China’s and Vietnam’s economy. It’s probably “good” news for Indonesian shoemakers now. But not in the long run. Someday, when the demand for Indonesian-made shoes increases, the wages start to creep up. Until a level where EU starts to concern again. And if EU is to be consistent, it will impose an antidumping policy to Indonesia, just like what it does now to China and Vietnam. And Timberland and friends will fly again, trying to find better places.

At that time our shoemakers will change their mind. They will say: EU should not impose antidumping policy to us. They will forget already that they have praised what EU did to China and Vietnam.

(A fable here)

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