Government lifts restrictions on rice imports

Government lifts restrictions on rice imports

JAKARTA (JP): The National Logistics Agency (Bulog) has lifted
restrictions on rice imports to meet domestic demand after the
conclusion of the harvest season, Coordinating Minister of
Economy Rizal Ramli said on Friday.

Rizal, who is also Bulog's chief, assured that the imports
would not depress local prices.

He explained that the policy could be reviewed in the future
depending on domestic rice stocks.

The restrictions would probably be re-imposed during the next
harvest season to prevent a rice glut, Rizal added.

"In agriculture we have to be flexible, and this is possible
now that the IMF is no longer intervening in the agriculture
sector," he was quoted by Antara as saying during a tour of the
Tanah Abang wholesale market in Central Jakarta.

He was joined by the Minister of Industry and Trade Luhut B.
Panjaitan, the Junior Minister for the Restructuring of the
National Economy Cacuk Sudarijanto, senior officials of the
Ministry of Industry and Trade, and the directors of state-owned
Bank Mandiri and Bank Rakyat Indonesia (BRI).

While Rizal did not indicate when the import restriction was
lifted, sources said they were lifted by the Director General of
Customs and Excise, Permana Agung, in August at Bulog's request.

Restrictions on imported rice were imposed by Rizal in April
when the price of locally produced unhusked rice plunged because
of over supply to as low as Rp 700 per kilogram, compared to the
government's floor-price of Rp 1,020.

The imposition of a 30 percent import tax at the beginning of
the year did not stem the flow of rice imports.

Rice imports by private importers reached 42,000 tons in
January and 38,000 tons in February.

Rizal, who had just taken office at Bulog when he imposed the
import restriction, argued that the agency could not ban private
sectors from importing rice, but could restrict them.

The restriction was done with the help of surveyor company
Sucofindo and the directorate general of customs and excise in
verifying the quality and quantity of rice imported both by
private importers and by the agency.

When the harvest ended, restrictions on imported rice were no
longer needed, Rizal said.

Several days after his installment as head of Bulog, Rizal
also renegotiated the date for the shipment of rice which the
agency had agreed to import prior to his tenure.

Rizal did not specify the volume of rice the agency had agreed
to import but sources at the agency put the number at hundreds of
thousands of tons.

Rizal said on Friday, Bulog had made an advance payment of 80
percent of the total invoice.

"Whether we wanted to or not, imports from existing deals had
to be finalized, otherwise Indonesia would be losing as it had
made 80 percent of the payment," he said.

The Agency imported 1.45 million tons of rice in 1999, down
from 6 million tons in 1998. (10)