The puzzle of cement price<\/p>\n
If there's a puzzle that could baffle a nation of some 190
\nmillion for weeks, then it must be the mystery of the cement
\nprice here. For weeks, following the government's decreed price
\nhike of cement retail reference price by over 40 percent early
\nthis month, the public was kept in the dark on the real reason
\nbehind the decision.<\/p>\n
After all, a few weeks ago the association of cement producer
\nhad asked an increase of only 20 percent, which according to
\ntheir calculation will bring enough profit margin to them.
\nUnderstandably, when suddenly the government decreed an increase
\nof over 40 percent, the decision had caused a public outcry. And
\nsince the government never satisfactorily explained the reason
\nbehind the magic 40 percent number, the mystery has deepened, and
\nunderstandably rumors and speculations were soon began flying.<\/p>\n
The popular belief is that there was some kind of collusion
\nbehind the price hike. Since the official reason, that the over
\n40 percent price hike is to woo foreign investors and to lure
\nmore imports, sounds too superficial even to many government's
\ntrue believers, many suspect that the cement producers are the
\nactors behind the scheme. The fact that only a handful of
\nbusiness groups control both the production and distribution of
\ncement has further fueled the speculation that the price hike is
\njust a ploy to reap a big profit.<\/p>\n
Interestingly, among those who cried out and protested the
\nprice hike were the ruling party Golkar. Golkar has even went as
\nfar as setting up a special task force comprised of legislators
\nto inquire into the cement price. According to Golkar's chairman,
\nHarmoko, the increase in cement reference price should be around
\n20 to 30 percent.<\/p>\n
What confounded the public is, how come a decision made by the
\ngovernment --which notably comprised of Golkar people-- was
\nattacked by Golkar's executive board? Is there no coordination,
\nor some kind of understanding, before the price increase was
\ndecided?<\/p>\n
Then the turning point came, but the shrouded mystery remains.
\nIn a speech in Madura over the weekend, Siti Hardiyanti Rukmana,
\ndeputy chair of Golkar, said that on the instruction of Golkar
\nChairman Harmoko, she recently reported to President Soeharto,
\nwho is also the Chief of Golkar's Board of Patrons, and who
\nhappens to be her father, about the cement situation. The
\nPresident was reportedly very concerned with the high price which
\nhas burdened the people.<\/p>\n
The effect of the statement was sudden and immediate: the
\nother day acting Minister of Trade Tunky Ariwibowo (Trade
\nMinister S.B. Joedono is still out of the country) announced that
\nretail price of cement should be 10 percent below the new
\nreference price.<\/p>\n
Has the puzzle been solved? Obviously, no. For the mystery has
\neven gone deeper. While Golkar leadership was soon triumphant and
\nhailed the new decision and claimed it as a success of its
\nendeavor, the public was jolted by the reaction of Sudwikatmono,
\nthe president of PT Indocement Tunggal Prakasa, the country's
\nbiggest cement producer. He welcomed the cut of the cement price
\nand admitted that the new reference price is still adequate to
\nencourage businessmen to make investment in the cement industry.<\/p>\n
What is this all about then? A storm in the cup? Or, is there
\nreally some kind of ploy behind the price increase? If 20 or 30
\npercent price hike is considered adequate by investors, where is
\nthe 40 percent magic number came in the first place? If the price
\nhike was aimed to close the gap between domestic price and the
\ninternational market price, then why the government bow the
\npublic (Golkar) demand and lower the price? Was the decision to
\ndrop the price based on political reasons rather than economic
\none? And what for?<\/p>\n
A hundred more questions can be raised, but we guess the puzzle
\nwill remain unanswered. What we can guess is that, perhaps, for a
\nlong time to come cement users will remain at the mercy of
\nproducers as long as the present monopoly system prevails.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/the-puzzle-of-cement-price-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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