Wed, 05 Apr 2000

New Bulog chief told to protect farmers

JAKARTA (JP): President Abdurrahman Wahid has ordered new National Logistics Agency (Bulog) chief Rizal Ramli to protect millions of rice and sugar farmers from the influx of cheaper imported staples.

Speaking before Rizal's inauguration at Bina Graha presidential office on Monday, the President said that without government protection, Indonesian farmers would not be able to survive the difficult situation currently facing them.

"You must remember that you have a difficult task, namely to overcome the sugar and rice crisis. This touches the fate of all farmers who have weak positions against international competition," the President said.

The price of unhusked rice in several Indonesian provinces has reportedly dropped to below Rp 1,000 (US$0.13) per kilogram, due to influx of cheap imported rice. This is far lower than the floor price of Rp 1,400 set under the government's rice stabilization program,.

Newspapers have reported that at current prices, the farmers' earnings are barely enough to pay expenses.

The price of sugar also has dropped sharply in recent months, also due to cheap imports.

The President expressed his annoyance over the rampant corrupt practices in the agency and said it was impossible for Bulog to work efficiently in stabilizing prices of basic commodities if the current mercenary practices continue.

"We can no longer tolerate occupation of Bulog by adventurers. It is now time for Bulog to promote clean people and clean transactions within the agency," the President remarked.

The President said he had decided to separate Bulog from the Ministry of Industry and Trade and put the agency directly under his control to ensure that it would work maximally for the people and not just to enrich certain people.

He pointed out that Bulog could no longer continue its present management practices, and must allow the Supreme Audit Agency (BPK) to audit its management.

"The supervision of rice and sugar affairs is directly under the President's control," Abdurrahman said.

Due to his poor eyesight, acting State Secretary Bondan Gunawan swore in Rizal on the President's behalf.

Rizal previously worked as the managing director of the Econit economic research institute, which often issued critical views on Bulog.

Speaking to journalists after his installation, Rizal disclosed that his primary goal is to improve the price of unhusked rice in the short term, especially in production centers like Karawang, West Java.

According to Rizal, he has talked with state owned bank BRI chief, Djoko Mulyono, and asked him to accelerate the disbursement of special funds to procure rice locally. The government is expected to spend Rp 6 trillion this fiscal year for local purchases.

Contrary to the statement last month by Minister of Trade and Industry (and outgoing Bulog chief) Jusuf Kalla that the government had no plan to cancel rice import contracts despite the sharp drop in prices on domestic markets, Rizal indicated that he would stop rice imports.

This is in line with Minister of Agriculture M. Prakoso's earlier suggestion that the government should temporarily stop rice imports to stabilize domestic market prices.

Even though Indonesia's rice production this year will not reach the projected 30 million tons, imports will amount to only 1.5 million tons compared to last year's 4.8 million tons.

"I will coordinate with the Custom and Excise Directorate General to supervise and stop the importation of rice," Rizal vowed.

He also vowed to realize the President's order to make Bulog a clean, effective and transparent organization. However, he refused to say whether he would replace Bulog's top officials or streamline the overstaffed agency.

"My main focus now is to increase the price of unhusked rice to make 60 million farmers happy. That is my priority," Rizal said.

Rizal also refused to explain the details of his policy on sugar imports saying he had to consult with Minister of Forestry and Plantation Nur Mahmudi Ismail before making any decision on that strategic commodity. (prb)