Country Specific Protectionist Policies

Country: Indonesia,
The market: Live beef,
The form of protectionism: quotas

          As Indonesia already had a quota for cattle import, there already was a welfare loss marked with the green triangles. and instead of people demanding Q2 at world price, they were wanting Q4 at Pquota1. Now that the government cut the quota even more, by 80%! Now since the price is higher due to the lack of supple,  people only demand Qeq at the price of Pquota2.  This gives us an even bigger welfare loss; the whole blue area + the green, consisting of loss on consumer surplus and loss of production efficiency.


       Before domestic suppliers provided 0-Q1 and Q3-Q4, and importers Q1-Q3. Now only Q1-Q5 of the cattle is imported, which is a huge change over that short period of time. And domestic suppliers are expected to supply 0-Q1 and Q5-Qeq.    

         Indonesia imports most if not all of it's cattle from Australia, and while they already had quotas placed on the trade, they decided to cut them almost by 80%! The reason government uses to justify this is that they want Indonesia to become more independent and for domestic producers to come to the rise. When before the cut, they ordered about 250 000 head a quarter then now just around 50 000. Due to the lack of supply yet on going demand for meat, Indonesia is facing a major shortage. If it doesn't work out then they might increase the quota a little again.

      Due to Indonesia having a very low level supply of cattle on their own, I don't think there is a single winner in this situation. Yes, it may help the Indonesian domestic cattle suppliers to come to the market a bit more, but in the meanwhile the people still want food and cattle is something that takes time to grow. You can't just slash the quota so much and expect people to wait for domestic cattle and pay a ridiculously high price until then. People will still want to eat, and in my opinion, they should if at all cut the quota little by little allowing the domestic suppliers to raise their cattle and not be pressured.
     

       This quote is a loss for everyone; Australia lost their main cattle importer, the people in the country have to pay a higher price for meat and might even run out of meat, and even though domestic suppliers might earn a bit more money then before they also have a lot of pressure put on them.

http://www.abc.net.au/news/2015-09-03/first-australian-live-cattle-export-resumes-indonesia/6746336