Bulog 'to resume' businesses 'closed' by IMF

JAKARTA (JP): New head of the National Logistics Agency (Bulog) Widjanarko Puspoyo said on Friday he would ask the government to allow the agency to resume its former commodity businesses that had been closed at the request of the International Monetary Fund (IMF).

Widjanarko said his request was justified by the Food Law No. 7/1996.

"As stipulated in the law, our job is to provide basic and essential foodstuff in adequate supply, of good quality, at an affordable price, and which is easily available.

"Therefore, Bulog should be given wider duties, and clearer responsibilities," Widjanarko told the press following his installment as head of Bulog, replacing Coordinating Minister for the Economy, Rizal Ramli.

Bulog is responsible for the price stabilization of unhusked rice and the distribution of rice.

When first established in the late 1960s, Bulog held the monopoly on the importation of rice, wheat, sugar, soybeans, and several other basic commodities.

However, this exclusive role was put into an end by the government in early 1998 following a request made by the International Monetary Fund (IMF), which organized a multibillion dollar bailout loan for the country.

"Bulog is responsible for the availability of food in the country. Thus, its role can't not be cut just because of international pressure," Widjanarko said.

The former vice chairman of the House of Representative's Commission III for agriculture and food affairs said that at this stage he was unable to specify the commodity businesses he expected Bulog to revive.

Widjanarko also said he would ask the government to restore the agency's former exclusive right of distributing rice to civil servants, the military and police.

The role of distributing rice to civil servants had been revoked in 1999.

He said the agency lost a lot of buyers because of the policy and it incurred higher costs for rice storage.

Widjanarko vowed to make the agency more dynamic, flexible, and less bureaucratic to make way for free competition.

He said he supported the government's plan to change Bulog from a nonprofit making agency into a profit-oriented state company, saying the change in the status would make Bulog more competitive in the international market.

Former Bulog chief, Rizal Ramli said last year that he planned to turn Bulog into a state company by June this year to improve its performance.

Regarding rice prices, Widjanarko said the agency would not let rice prices be totally determined by free market forces in an effort to protect farmers' interests.

"We still need to maintain the set floor-price policy on rice to protect farmers' earnings, which in turn would ensure the availability of food in their homes," he said.

Widjanarko said that Bulog rice stock was adequate for the country's consumption throughout this year and that there was no need for rice imports.

The total stock of rice in Bulog's warehouses as of March 20 was at 800,000 tons. (tnt)