Beddu Amang replaced as Bulog chief

JAKARTA (JP): President B.J. Habibie yesterday replaced the State Logistics Agency (Bulog) chairman Beddu Amang in what information minister Muhammad Yunus said was the initial step in a concerted effort to restructure the agency.

Yunus told journalists after a cabinet meeting on political and security affairs that a presidential decree had been prepared for the replacement, which took effect yesterday.

The agency would for the time being be run jointly by Minister of Industry and Trade Rahardi Ramelan, Minister of Cooperatives, Small and Medium Enterprises Adi Sasono, and State Minister of Food and Horticulture A.M. Saefuddin, he said.

Yunus said Beddu was being replaced in light of the government program to restructure the agency, which is in charge of the procurement and distribution of basic staple foods throughout the country.

"As of January 1, the agency will only handle (the procurement and distribution of) rice. This (replacement) is entirely for reasons of efficiency," he said.

Bulog has been named by the International Monetary Fund (IMF) as one of the monopolies to be disbanded in return for a multi- billion dollar aid package to help Indonesia overcome its current economic difficulties.

The agency has often been accused of inefficiency and corruption.

Beddu and A.M. Saefuddin met with Habibie after the cabinet meeting and were later joined by Rahardi.

All three refused to talk to the press afterwards.

A few hours before the announcement, Beddu was still talking to the media about the agency's plans to import 4.5 million metric tons of rice, up from a previous estimated requirement of 3.5 million tons, to meet domestic needs this year.

Local rice prices have risen to as high as Rp 4,000 per kilogram in recent weeks, well above the government's target price of between Rp 1,750 and Rp 2,000 per kg.

Some observers have speculated that a rift between Beddu on one side and Rahardi and Adi Sasono on the other could be one of the reasons behind the replacement.

The chairman of the Association of Indonesian Edible Oil Industries, Nafis Daulay, said: "The Ministry of Industry and Trade and Bulog have recently appeared to be at odds with one another. Their policies on rice and cooking oil supplies, for instance, were not synchronized."

H.S. Dillon, executive director of the Center for Agriculture Policy Studies, commented yesterday a strategic agency like Bulog should be headed by a person who really knew the movements of the food market and could not be easily coopted by certain interest groups.

Both Daulay and Dillon speculated that the real reason behind Beddu's removal was evidence of collusion in the awarding of Bulog contracts to import basic commodities. Most contracts have thus far been awarded to the Salim Group.

They said now that Beddu had been replaced, the agency would become more transparent in its procurement and distribution operations.

Economist Didik J. Rachbini from the Institute for Development of Economics and Finance (INDEF) believed that Beddu's removal would speed up the process of rationalizing and restructuring the agency.

"Bulog has been targeted for restructuring by the IMF because it is notorious for inefficiency and the opaque manner in which it operates," Didik said.

Elyas, a member of the House of Representatives Commission III for agriculture, forestry and plantations, said Beddu should be held responsible for the steep rise in the price of basic foodstuffs despite the government having provided huge subsidies. (prb/gis/rid)