New sugar policy not so sweet for producers<\/p>\n
JAKARTA (JP): The government's move to impose new restrictions
\non sugar imports will not bring much help to local sugar
\nproducers, according to the association of Indonesian sugar
\nproducers.<\/p>\n
Indonesian Sugar Association chairman Farukh Bakrie said
\nallowing sugar producers to import the commodity would not help
\nlocal sugar compete with the less expensive imported sugar.<\/p>\n
\"What the industry needs is for the government to reimpose
\nimport duties in order to protect the sugar industry and
\nfarmers,\" Farukh was quoted by Antara news agency as saying.<\/p>\n
He said imposing import duties on sugar was easier and more
\neffective than the new restrictions in reducing sugar imports.<\/p>\n
\"By imposing a high import tariff on sugar the government
\nwould gain additional revenue, while the government could save
\nthe money it uses subsidizing sugar factories,\" Farukh said.<\/p>\n
Under the new sugar policy enacted by the Ministry of Industry
\nand Trade late last week, certain types of sugar will only be
\nallowed to be imported by Java-based sugar producers which hold
\nimport and production permits. The amount of sugar the mills will
\nbe able to import will be decided by the ministry.<\/p>\n
The new policy, which will remain valid until December this
\nyear, regulates eight categories of sugar which are allowed to
\nenter the country, including cane sugar, beet sugar, packaged
\nsugar and double refined sugar.<\/p>\n
The new policy states sugar importers\/producers must submit a
\nwritten report on their sugar imports to the Directorate General
\nfor Foreign Trade, which issues sugar import licenses.<\/p>\n
According to the ministry, the new import restrictions are
\nintended to protect the domestic sugar industry and sugarcane
\nfarmers from a further fall in sugar prices.<\/p>\n
The government removed import duties on sugar late last year
\nin compliance with economic reform programs agreed upon with the
\nInternational Monetary Fund (IMF), which is organizing a US$40
\nbillion bailout for Indonesia.<\/p>\n
Indonesia, which produces about 1.7 million tons of sugar a
\nyear, has to import the commodity to meet local demand, which
\nreaches about 3.1 million tons.<\/p>\n
The liberalization of sugar imports has severely damaged local
\nsugar producers, particularly after the rupiah strengthened
\nagainst the U.S. dollar over the past few months. This has made
\nlocal sugar more expensive than imported sugar.<\/p>\n
Meanwhile, Minister of Industry and Trade Rahardi Ramelan
\ndefended the new sugar import restrictions, reiterating that the
\nnew policy was aimed at helping the local sugar industry and
\nsugarcane farmers.<\/p>\n
Rahardi said under the new policy, sugar producers\/importers
\nwould be obliged to buy a particular amount of sugar from local
\nfarmers. However, he did not specify the amounts.<\/p>\n
The minister also said the new sugar policy did not violate
\nthe economic programs agreed upon with the IMF.<\/p>\n
\"We have the right to issue regulations to cure our ailing
\nsugar industry. This is an emergency case,\" Rahardi said, adding
\nthat the new policy would end before the IMF letter of intent
\ncame into effect in 2000.<\/p>\n
Director General for Foreign Trade Djoko Moeljono said
\nreimposing import duties on sugar would be complicated because
\nthe government would first have to notify the World Trade Order
\nand Association of Southeast Asian Nations ministers.(01)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/new-sugar-policy-not-so-sweet-for-producers-1447893297",
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"sponsor_url": "https:\/\/okusiassociates.com"
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