PTPN officials to be grilled over alleged sugar smuggling

PTPN officials to be grilled over alleged sugar smuggling

Abdul Khalik, Jakarta

The National Police announced on Monday they were investigating
several officials from state sugar importer PT Perkebunan
Nusantara (PTPN) X, following allegations they were involved in
sugar smuggling.

Responding to a police report filed by the Indonesian
Sugarcane Farmers Association (APTR) earlier that day, National
Police Chief of Detectives Comr. Gen. Suyitno Landung Sudjono
said his officers had been working on the case since the
beginning of the year.

"We had already arranged to question these officials today. We
have not declared them suspects yet but we may once we have
gathered sufficient evidence," Suyitno said.

Police were aware PTPN X's license to import sugar had expired
in April but the company had kept on importing the commodity, a
practice clearly in violation of the regulations, he said.

PTPN IX, PTPN XI, PPI, and PT RNI are the only four firms
currently licensed to import sugar.

Speaking after he filed the report, APTR chairman Arum Sabil
said he had found 56,000 tons of smuggled sugar inside a
warehouse in Tanjung Priok port, Jakarta.

He said the sugar was owned by PTPN X, PT Phoenix Commodities
Indonesia and Jakarta's Association of Cooperatives (Inkud).

"We have demanded all of these entities be investigated to
find out which are responsible for the smuggling. We have
documents proving there was a conspiracy to bring the sugar
illegally into the country," Arum said.

He said while PTPN X at one time had the right to import
sugar, he had evidence the company had done so without the proper
documents. The other two entities were clearly smuggling the
sugar because they had no authority at all to import the
commodity, he said.

Arum said Jakarta customs and excise officials should also be
questioned because it was impossible the smuggling could occur
without their cooperation.

Suyitno said he would follow up the report but said police had
not yet found any evidence linking officials from entities other
than PTPN to the smuggling. However, the ongoing investigation
could be expanded, he said.

Arum said the smuggled sugar had hurt thousands of sugarcane
farmers across the country as the imported sugarcane had lowered
the market price to below local production costs.

"Sugar production costs us between Rp 3,200 to Rp 3,500 a
kilogram while the smuggled sugar is sold at Rp 2,100 a kilogram.
How can we survive in this kind of situation?" Arum said.

A huge gap between local production and domestic demand has
led to widespread sugar smuggling in the country. Indonesian
sugar production stood at 1.8 million tons in 2002, while demand
that year reached 3.2 million tons.

The government has been unable to stop the widespread
smuggling.

The customs office at the country's main port of Tanjung Priok
recently confiscated 3,674 tons of smuggled sugar, while reports
estimate about 24,000 tons of illegal sugar enters the country
via West Kalimantan every year.