Ginandjar clarifies rice distribution

JAKARTA (JP): Responding to Japan's concern over reports of problems in the distribution of its rice loan, Coordinating Minister for Economy, Finance and Industry Ginandjar Kartasasmita invited on Thursday any parties, including journalists and nongovernmental organizations (NGOs), to directly check the distribution of the rice.

"I have told the Japanese government to send their investigators here," Ginandjar said after accompanying President B.J. Habibie to a ceremony installing the executive board of the National Scout Movement at the State Palace.

Ginandjar's stance, however, appeared to differ from that of Minister of Trade and Industry Rahardi Ramelan, who blamed Japanese NGOs for what he believed was an unnecessary uproar over the distribution of the rice.

Ginandjar will leave for Japan on Sunday for a three-day visit to meet with Japanese Prime Minister Keizo Obuchi and other economic leaders. The controversy over the distribution of Japan's loan of 500,000 metric tons of rice is expected to become one of the main topic of the meetings' agenda, although the primary reason behind the visit is to discuss more loans for Indonesia.

A senior diplomat at the Japanese Embassy here, Norio Hattori, met with Rahardi, who is also head of the State Logistics Agency (Bulog), on Wednesday. Hattori conveyed his government's concern over negative reports in the Japanese media about the rice distribution.

Hattori told Rahardi that Tokyo needed evidence that the rice, bought from Japan under a soft loan agreement, had been promptly distributed to the poor as previously agreed by the two governments.

"It's only the Japanese press and NGOs who have been making noise about the rice aid," Rahardi said on Wednesday.

Rahardi said he met with Hattori, whom he identified as Japanese vice ambassador, and claimed that the diplomat understood his explanation of the distribution of the loaned rice.

Rahardi confirmed that Bulog replaced the loaned rice intended for the poor with lower quality rice, saying that the Japanese rice's quality was too excellent and Japan had no right to dictate to the Indonesian government the terms of its distribution. He pointed out that the rice was a loan and not a grant.

The rice for the poor is sold at the subsidized price of Rp 1,000 per kilogram, while the price of the Japanese rice is at least Rp 2,700 per kg.

"He (Hattori) admitted that the distribution system implemented here was smooth," Rahardi said on Wednesday.

Japan has sent 500,000 metric tons of rice as of December, and another 100,000 metric tons are expected to arrive soon.

The World Food Program is to distribute 40,000 metric tons of the rice, while Indonesian NGOs have also been asked to take part in the delivery of the rice. The NGOs, however, have complained that they were asked to finance the transportation of the rice from Bulog's depots to its final destinations.

The already received 500,000 metric tons of rice was grown in Japan, while the expected 100,000 metric tons was bought on the international market. The total value of the rice is about 11 billion yen.

Japanese Foreign Minister Masahiko Komura said in October that his country was ready to supply another 400,000 metric tons if Indonesia was faced with further rice shortages.

Major Japanese newspapers, such as Yomiuri Shimbun and Asahi Shimbun, reported alleged irregularities in the rice distribution. The two newspapers have foreign correspondents based here.

A Japanese source said Indonesia should be more sensitive of Japanese taxpayers' concerns and their growing criticisms over how the loaned rice was distributed.

"Our taxpayers have the right to be assured that their taxes are properly used," the source said on Thursday.

The government has calculated up to US$3 billion in loans from Japan into its 1999/2000 state budget. The loans are expected to come from the $30 billion Miyazawa Plan, designed to help Asian countries recover from the region-wide economic crisis.

"We will be in a very difficult position if our taxpayers find that our loan has been misused and not effectively spent," said the source. (prb)