Export tax policy in Indonesia: The impacts on competitiveness and price integration of cocoa products

Abstract

Until 2010, the Indonesian cocoa exports had been dominated by cocoa beans, which led the government to stimulate the processing industry by implementing cocoa export tax policy. This study aims to determine the impact of cocoa industrialisation policy on the competitiveness of cocoa beans and processed products as well as the integration of cocoa prices. The implementation of export tax policy significantly decreases cocoa bean export competitiveness, contradictory with intermediate products. Export tax policy also has no impact on the integration of domestic and international cocoa market. In developing the cocoa downstream industry, on-farm support in producing fermented cocoa beans is vital.