Bangkok, The PRAKARSA – The Institute for Policy Research and Advocacy PRAKARSA together with other civil society organizations (CSOs) in Asia consisting of LDC Watch, SAAPE, Sal Forest, Indonesia Tax Justice Forum, and Oxfam held Expert Workshop titled "Challenges and Opportunities for Strengthening CSO Advocacy: The Impact of Global Tax Incentives and Trade Systems on Asia's Palm Oil, Tea Plantation and Fisheries Sectors to Strengthen Domestic Value Addition in Global Value Chains", on Wednesday (March 12, 3). The event aimed to discuss the challenges and opportunities in strengthening CSO advocacy concerning the impact of global tax and trade systems on the palm oil, tea plantation, and fisheries sectors in Asia.
Ah Maftuchan, the Executive Director of The PRAKARSA, explained that Asia, with its diverse economies from Southeast Asia to South Asia, plays a crucial role in global trade. Commodities such as palm oil, tea, and fisheries are the backbone of economic growth and livelihoods for millions of people. “However, the existing global tax and trade incentive systems often undermine sustainable and equitable development in these sectors,” he stated.
According to Maftuchan, while Global Value Chains (GVC) offer the promise of economic growth and job creation, the benefits are disproportionately enjoyed by large multinational corporations. “Small farmers, tea growers, and fishermen in Asia often face systemic barriers such as limited access to high-quality resources, materials, or tools, fair prices, and financial services. For instance, in Indonesia, palm oil farmers frequently struggle to obtain fertilizers and fair selling prices. Furthermore, the fisheries sector has seen a drastic decline in participation in the global supply chain, decreasing by 75% from 1995 to 2018. This indicates that small-scale producers are increasingly marginalized,” he added.
Maftuchan also highlighted policy challenges in Asia, particularly concerning tax competition and fiscal constraints. “One of the main challenges is the occurrence of a 'race to the bottom'in tax policies, where Asian countries compete to attract foreign investment by lowering corporate tax rates and providing excessive incentives. This has eroded fiscal capacity, reducing resources for infrastructure development, social protection, and support for small producers,” he explained.
Maftuchan emphasized that trade policies in Asia often exacerbate injustices, further marginalizing small farmers and fishermen. “For example, stringent sustainability certification requirements in the fisheries sector, non-transparent pricing mechanisms in palm oil and tea trade, and limitations on market access reduce the bargaining power of small farmers and fishermen,” he stated.
Sanya Smith from the Third World Network provides insights into how global trade rules, such as tariff liberalization, affect small businesses within supply chains and trading activities. She also explains how these rules impact domestic resources and efforts to build value-added production. The discussion also touches on the effects of Trump's trade policies on developing countries.
Additionally, Hadi Rahmat Purnama, the Director of the Center for Law and Human Rights at the Institute for Economic and Social Research, Education, and Information (LP3ES), who also spoke at the event, noted that strict Rules of Origin (ROO) have restricted market access, increased compliance costs, limited participation in regional supply chains, reinforced trade dependency, and hindered industrialization,” Hadi expressed. (ROO) have disadvantaged developing and least developed countries, ultimately making it difficult for these countries to benefit from global trade agreements.
" Rules of Origin (ROO) have restricted market access, increased compliance costs, limited participation in regional supply chains, reinforced trade dependency, and hindered industrialization,” Hadi expressed. “Strict (ROO) has limited market access, increased compliance costs, limited participation in regional supply chains, strengthened trade dependency, and hampered industrialization,” said Hadi.
Furthermore, Herni Ramdlaningrum, Program Manager at The PRAKARSA, explained that the workshop aimed to discuss the challenges faced by small farmers and fishermen in the global supply chain, particularly in the palm oil and fisheries sectors in Asia. “Additionally, we aim to analyze the impact of the global economic system on developing countries in Asia, focusing on domestic value addition for economic diversification,” she elaborated.
Herni also outlined that the agenda for this workshop included in-depth discussions on the challenges of tax and trade policies and their impact on the palm oil, tea, and fisheries sectors. “We will also discuss how to strengthen advocacy and policy strategies through the exchange of experiences and lessons among CSOs and experts. Moreover, this workshop aims to foster collaboration for systemic policy transformation by building stronger networks among tax and trade experts, CSOs, and regional stakeholders,” she added.
Herni hopes that this discussion will yield actionable policy recommendations to promote fairer and more sustainable trade and tax policies in the Asia region. The outcomes of this workshop will also serve as the basis for recommendations to be presented at the upcoming Asia Pacific Tax Forum 2025 in Indonesia.
Participants in this workshop included representatives from various organizations, including The PRAKARSA, SAAPE, Sal Forest, Oxfam Asia, Oxfam Indonesia, LCD Watch, Third World Network, Focus on the Global South, Sahita Institute, PWYP Indonesia, Lokataru, and several other organizations from Malaysia, Thailand, and Indonesia that are engaged in tax advocacy.
"This workshop is expected to be an important step towards more inclusive and sustainable economic development in Asia. 'We hope that the outcomes of this workshop can serve as a foundation for stronger policy advocacy and collaboration among stakeholders to create a more equitable and sustainable economic system,” concluded Herni.