KDI yet to receive guidelines for cooking oil sale<\/p>\n
JAKARTA (JP): The Indonesian Distribution Cooperative (KDI)
\nsaid on Saturday that it had not received any guidance or
\ninstruction from the government, despite last week's decision to
\nmake it the official distributor of cooking oil in the country.<\/p>\n
KDI chairwoman Dewi Motik said that KDI, which groups 19
\nfederations of cooperatives, was unable to begin the new job
\nbecause it did not understand what it was supposed to do.<\/p>\n
Last week, the government appointed KDI to take over the role
\nplayed by the State Logistics Agency (Bulog) in the distribution
\nof cooking oil as part of its efforts to improve the system used
\nto distribute essential commodities in the country.<\/p>\n
Motik said the government had notified her of the appointment,
\nbut added that the technical details of the contract remained
\nunclear.<\/p>\n
\"We certainly need clear guidelines to carry out the job,\"
\nDewi added.<\/p>\n
She said that all KDI provincial branches and officials were
\nready to distribute cooking oil, but said they needed clear
\nguidelines to do the job well.<\/p>\n
Last week, the government announced several changes in the
\ndistribution of cooking oil, wheat flour, sugar and soybeans.
\nSubsidies on all these goods will be removed on Sept. 7, although
\nthe 60 percent tax on the export of crude palm oil will remain in
\nplace.<\/p>\n
As a consequence, Bulog, which previously controlled the
\ndistribution of all commodities, will now only handle rice.<\/p>\n
The government has projected that without the subsidy, the
\nmarket price of cooking oil will rise to between Rp 4,600 and Rp
\n4,800 per liter. It is already above Rp 4,000.<\/p>\n
Cooking oils, most of which are made of crude palm oil (CPO),
\nhave increased sharply in price since the rupiah fell drastically
\nin value against the U.S. dollar.<\/p>\n
Although the government has set a high export tax on CPO and
\nits derivatives, large volumes have continued to leave the
\ncountry, much of it smuggled. The resulting scarcity in supply
\nhas forced prices up to a level unaffordable for many
\nIndonesians.<\/p>\n
The government has tried a number of measures to ensure that a
\nsufficient supply of cooking oil reaches the market at a lower
\nprice, but all have failed.<\/p>\n
Analysts welcomed last week's decision to remove the subsidy
\non cooking oil, but urged the government to refrain from
\ninterfering further with trade in the commodity to allow the
\nmarket to establish its equilibrium price.<\/p>\n
They warned the government that it was repeating past mistakes
\nby appointing KDI to play the role vacated by Bulog in the
\ncooking oil distribution chain and said the appointment showed
\nthe government was merely shifting preferential status from big
\nbusiness to cooperatives.<\/p>\n
They also urged the government to allow other parties to
\nbecome involved in the distribution of cooking oil and lift the
\nmonopoly granted to KDI to avoid distorting the market.<\/p>\n
Meanwhile, the director general of domestic trade in the
\nMinistry of Industry and Trade, Ilchaidi Elias, said that several
\nprivate cooking oil producers, including those belonging to the
\ngiant Sinar Mas Group, Salim Group, Bakrie Group and Astra Group,
\nhave pledged to supply KDI with a significant proportion of their
\noutput to help stabilize prices. (gis)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/kdi-yet-to-receive-guidelines-for-cooking-oil-sale-1447893297",
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"sponsor": "Okusi Associates",
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