TOWARD A LIBERALIZATION OF TRADE IN SERVICE: THE CASE OF THE HIGHER EDUCATION INDUSTRY IN INDONESIA.

Author:Sutrisno, Nandang
Position:Report - Abstract
 
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INTRODUCTION

It is undeniable that the notion of opening up to global economy has become almost necessary for achieving the domestic economic growth as in the case of the four Asian tigers (Panagariya, 2002). This means it include the not-so-popular dimension of free trade in services in spite of its profound beneficial impact compare to the more traditional trade in goods (Pritchett, 2006). More importantly, the trade in services is potentially more explosive in nature due to its sociologically and culturally challenging in nature. The on-going backlash against migration across Europe and United States has been depicted as a paranoia that has something to do with the intangible cultural threats (Inglehart & Norris, 2016). That said, it may be argued that it is high time to proffer a proposal that may help in fostering a rational debate to one of the emotionally charged subject in the development discourse in the developing world in particular.

With the above objective in mind, this paper is modestly using Indonesia as its case study as it perfectly captures the necessary dynamics of an anxious developmental state that is trapped in an on and off fascination with economic nationalism (Patunru & Rahardja, 2015). More to the point, Indonesia's overall stance toward trade in services might be described as disinterested at best and unfavourable at worst. As an observer summed up, Indonesia's cautious approach can best be described as a widespread antagonism toward the regime (Iskandar, 2011). Moreover, it appears that there has never been any non-state support for the adoption of a more positive recognition of the potentials of trade in services in support of national development (Iskandar, 2011). For what's worth, this reality doesn't sit well with the fact that Indonesia has submitted itself to a myriad of international legal obligations that commit it to liberalize its market.

Given the above situation, it is necessary for Indonesia to introduce some progressive measures that help "progressively liberalized trade" in services while at the same time balance out the fervour of economic nationalism. This delicate situation is by no mean exclusive to Indonesia's case, I believe, many other developing countries face the same dilemma in their quest of finding a right balance in search of a healthy dose of rational policy while at the same time reflecting the political calculus. In other words, I am convinced that the relevance of this paper is beyond the boundaries of Indonesian studies. Thus, this paper is aimed to contribute the growing body of scholarship, especially in the area of policy-making and development studies in addition to the obvious law and development studies. To this end, this paper proposes a host of proposals that can be implemented at the practical level.

The argument of this paper unfolds as follow. In the next section, I will address the opposing point of views that have been advanced by the opponents of liberalization, mainly from civil society, which are largely employed some populist rhetoric have significant presence in the public discourse that may put at risk the above limited achievement in the liberalization. The following section is setting out the international legal obligation of Indonesia as a state party to a host of multilateral treaties that provides the legal framework for Indonesia to liberalize its domestic market. In the penultimate section, the discussion delineates my proposal in terms of what kind of legal response that may not only be able to conform to the Indonesia's legal obligations as a member state of the WTO but also taking into account all the factors that traditionally been considered as national interests. The last section concludes.

BACKGROUND

The most widely rehearsed argument against the liberalization of higher education is that liberalization is designed in such a conspiratorial manner to eliminate the role of state in providing financial support for the educational sectors (Umar, 2014). According to this logic, it would lead to further commercialization of higher education that eventually increase the cost for attending university (Putri, 2016). More specifically, in this scenario, liberalization is the ultimate threat to the current subsidy schemes for higher education which is empirically proven that for the most part is misleadingly consumed by the middle class (OECD, 2015). Importantly, this criticism failed to recognize that state's involvement in higher education industry has legitimized its co-optation by the political power that paralyzed its role as part of the civil society (Hadiz & Dhakidae, 2005).

Another argument that also has a strong populist tone is that liberalization of services in higher education would lead to "ideological infiltration," through which Indonesian students would be "brainwashed" so that they would lose their local values, religiosity, identities and wisdom (Hizbut, 2012). In other words, education is just another regular trading commodity like any other commodities, such as garments, cars, tableware, shoes and corns. Education would mainly be designed is solely in terms of reaping the material economic benefits, instead of pursuing something which is far more ideal and abstract, such as character building. This ideology based argument is equally problematic, in addition to its...

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