Mega asks Rini to stop sugar imports

Mega asks Rini to stop sugar imports

Adianto P. Simamora, The Jakarta Post, Jakarta

President Megawati Soekarnoputri said on Monday that she had
instructed Minister of Trade and Industry Rini Soewandi to take
action to stop sugar imports in a bid to protect local sugarcane
farmers.

She was quoted by Antara as saying that the import of sugar
into the country had become excessive.

"I once asked Ibu Rini to try and stop sugar imports, but
there were complaints that we might suffer a shortage of the
commodity," she said during the opening ceremony for a national
convention on standardization.

She did not elaborate.

Today, the country's total sugar output is 1.7 million tons
per year, compared with domestic consumption of about 3.3 million
tons. To make up for the shortfall, the country imports sugar.

Indonesia is the world's second-largest sugar importer.

However, sugarcane farmers have long complained that imports
were excessive, and that cheaper imported products were hurting
their income.

They have staged demonstrations, calling on the government to
impose a high import tariff on sugar to protect them from the
massive inflow of cheaper, imported sugar products. The farmers
have also demanded a subsidy.

After raising the import tariff on white sugar to Rp 700 per
kilogram from the previous level of Rp 450 per kilogram, Rini
issued a new decree stipulating that only state-owned plantation
companies would be allowed to import sugar. Imports of the
commodity will be stopped only if the price of sugar at the
farmers' level falls to as low as Rp 3,100 per kilogram.

Farmers have said that the new import tariff is still too low
and would not be effective in halting the massive inflow of
cheaper imported products.

But Rini has argued that a very high import tariff would hurt
local consumers and manufacturers that used sugar as a raw
material in their production processes.