Inflation rate recovers after deflation in June
JAKARTA (JP): Rising food prices pushed up the inflation rate in July, with the consumer price index rising 0.68 percent after June's deflation of 0.07 percent, Minister of Information Harmoko said yesterday.
Harmoko attributed the increased inflation rate to a 1.04 percent rise in the price of food, which had fallen 0.05 percent in the previous month.
"Prices of a number of food products such as eggs, milk and fresh fish rose because of distribution problems, rather than because of supply shortages," he told reporters after a monthly cabinet meeting on the economy.
Housing prices increased 0.42 percent in July, clothing prices rose 0.51 percent and the prices of other goods and services rose 0.55 percent.
July's inflation brought the cumulative inflation rate for the January to July period to 4.7 percent, much lower than the 6.09 percent figure recorded for the same period last year, he said.
On international trade, the minister said that total exports increased slightly to US$4.07 billion in May from $4.01 billion in April. Imports also increased slightly to $3.8 billion from $3.6 billion.
The country's monthly trade surplus, as a consequence, dropped to $203.1 million in May from $366.2 million in April, he said.
He said the drop in the trade surplus did not reflect the country's worsening export performance because all of Indonesia's top-ten export products, except plywood, had gained significantly.
In the January to May period, total exports were $19.34 billion and total imports were $17.17 billion.
"The total surplus in the January-May period reached $2.16 billion," he said.
Exports
According to the minister, the performances of the country's major exports in May were promising despite the drop in the trade surplus. Textile exports, for example, increased 10.35 percent. Exports of processed rubber rose 8.43 percent, steel products rose 38.5 percent, and coconut and palm oils rose 18.96 percent. Plywood exports, on the contrary, dropped 1.23 percent.
The limited cabinet meeting on economic affairs, which is held every month, discussed the latest developments in the country's economy.
An important topic raised at the meeting was the assessment of the supply and demand of certain strategic commodities such as rice, sugar, flour, cement and fertilizer.
Harmoko said the cement supply, which was often interrupted during rainy seasons, was expected to have no major problems this month.
The cement stock, which is expected to reach 845,304 tons by the end of this month, is sufficient to meet demand, he said, adding that the supply of other important commodities such as rice, cooking oil and fertilizer would also remain under control.
On the government's plan to promote more sugar plantations outside of Java, Harmoko said that thousands of hectares of land had been appropriated.
"The President has told related ministries to involve private companies in the sugar plantation expansion," he said.
A number of provinces are ready for the expansion project, including Lampung, South Sumatra, Central Kalimantan, East Kalimantan, South and Southeast Sulawesi, Maluku, Irian Jaya and East Timor.
Under the program, the annual sugar production in the provinces outside of Java is expected to reach 1.51 million tons by the year 2000. In that year, sugar production in Java is expected to decline to 1.46 million tons, he said. (hen)
Photo -- Page 3
Editorial -- Page 4