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)