Bungaran, Rini hold talks to resolve policy disagreement

Adianto P. Simamora, The Jakarta Post, Jakarta

Minister of Agriculture Bungaran Saragih and Minister of Industry and Trade Rini MS Soewandi held a two-hour breakfast meeting on Friday in what seems to be an effort to patch up differences over a host of trade policies.

The informal meeting also involved senior officials of the two ministries.

Rini declined to comment on the content of the meeting. She only said: "I came here to have a relaxing talk with Bungaran."

Bungaran talked briefly to the media.

"This is our second informal meeting since Ibu Rini was appointed Minister of Industry and Trade. We want senior officials from the two ministries to get to know each other," said Bungaran.

He hoped that through such informal talks, the two ministries could build a common perception on particular issues before they are in future proposed to other related ministers or the Cabinet.

Bungaran and Rini have been in disagreement over a range of trade policies linked to a number of the country's key agricultural commodities.

A high profile dispute between the two erupted in April, when Rini launched a campaign to force Bungaran to abandon the ban on imported chicken legs from the U.S. Rini said the ban was against a ruling by the World Trade Organization (WTO).

The Ministry of Agriculture imposed the ban in May 2001 in a bid to protect local poultry farmers.

The ban remains in effect.

The agriculture minister has proposed a higher import tariff on at least four key agricultural commodities including rice, sugar, soybean and corn to protect local farmers against cheaper imported products. But Rini opposes such plans, fearing a negative impact on consumers and industries as the end-users of the commodities. A higher import tariff would raise the prices of commodities here.

Bungaran had argued that the higher tariff was needed because other countries had already introduced such policies and had even provided their farmers with subsidies, something the government of Indonesia could not afford.

He added the higher import tariff on agricultural commodities was not against any of the WTO's rules.

Rini then unveiled plans to adopt a ceiling price and floor price mechanism on sugar to protect both the interests of farmers and consumers.

But the plan was criticized by Bungaran, saying that such a policy would be costly for the cash-strapped government.

Indonesia produces 1.5 million tons of sugar annually, with domestic consumption of three million tons a year.

Indonesia imported around 2.1 million tons of sugar in 1999 and 1.2 million tons in 2000.

But Bungaran told the press after the meeting that Rini had agreed in principle to a higher import duties on sugar. She also supported ideas to provide subsidies to local farmers.