Govt goes ahead with sugar program despite criticism

Govt goes ahead with sugar program despite criticism

Eva C. Komandjaja, The Jakarta Post, Jakarta

The government said it planned to continue with the program of
providing sugarcane farmers with new high-yield seeds to address
the problems in the country's ailing sugar industry.

Minister of Agriculture Bungaran Saragih told The Jakarta Post
last week that the government would continue to provide the
country's sugarcane growers with approximately Rp 68 billion
(US$8 million) in grants and Rp 1 trillion in soft loans per year
until 2005 to help replant their fields using the new seeds.

"With that money, growers can replace their old sugarcane
with new high-quality seeds to increase output. With such aid we
hope that Indonesia will be able to export sugar by 2007," said
Bungaran.

From being the world's second largest sugar producer in the
Dutch colonial era, Indonesia has move so far backwards that is
now the world's second largest sugar importer, behind only
Russia.

The program, which was launched in September last year, has
sparked criticism from the Indonesian Association of Sugarcane
Growers (APTRI), who said much of the aid money had ended up in
the hands of people who are not farmers, but instead were people
connected to state-owned plantation firms.

Furthermore, association chairman Arum Sabil said last week
that the program was ineffective because the main problem in the
country's sugar industry was the old machinery still being used
and their inefficient labor force.

He said that rather than spending large amounts of money on
new seeds, the government needed to replace the old, outmoded
sugar mills.

Bungaran claimed that the government did not have enough money
to spend on both seeds and sugar mills.

"There are over 56 sugar factories in Indonesia. We would need
a large amount of money to revitalize them. We can't do it now,
but maybe in the next two or three years we can. So we have to
prioritize sugarcane seeds," said Bungaran.

He said the reason that he put the priority on new seeds was
because many plants in Indonesia had been replanted more than 15
times, while they should not be replanted, using shoots from
harvested plants, more than three times.

The minister disagreed with Arum, saying that growers should
not blame the low production on the factories, because in Cuba,
sugar factories were older than those in Indonesia, but were
still able to produce more.

Responding to criticisms about inefficient human resources at
the nation's sugar factories, which are mostly state-owned,
Bungaran said that he had written a letter to State Minister of
State Enterprises Laksamana Sukardi to improve the management and
human resources at the factories.

As for the disbursement of the money to the wrong people,
Bungaran passed the blame on to the farmers.

"If it is true that the funds end up in the hands of non-
farmers, it is the farmers' own fault. They are responsible for
the funds. We have done everything we can for the benefit of the
farmers," he disclosed.

Bungaran was optimistic that the self-sufficiency and export
target in 2007 was achievable, despite pessimism expressed by
state-owned sugar factory operators during a hearing with the
House of Representatives early last month.

The firms reported that the sugarcane rehabilitation program
in their respective areas had not gone ahead as scheduled due to
many factors, such as drought and the loss of interest by
sugarcane farmers because of the low sugar prices.

Bungaran added that the result of this year's acceleration
plan, would not be seen for a few years.