Rahardi: Indonesia to stop importing rice until January
JAKARTA (JP): Minister of Industry and Trade Rahardi Ramelan said on Friday that Indonesia would not import rice until January, as existing stocks are sufficient to meet demand during the next three months.
"We do not need to import more rice through commercial purchases until January, because we have enough rice stocks," Rahardi, also the acting chairman of the State Logistics Agency (Bulog), said in a press conference.
He said that Bulog's rice stocks are currently 2.3 million tons, enough to meet the domestic demand until the end of this year. He also stated that the agency procured 222,000 tons of rice from local farmers during the January-October period.
Indonesia has so far secured import contracts and aid commitments for 3.49 million tons of rice, or over 85 percent of the 4.1 million tons which will be procured by the government from overseas markets this fiscal year, which ends in March.
Rahardi said that the 3.49 million tons of rice includes 716,000 tons bought through international tenders in September, 750,000 tons obtained through direct purchases before September, loans from Japan totaling 500,000 tons and loans and grants from other countries.
Rahardi said that the government was engaged in talks concerning the further aid of about 400,000 tons of rice from Japan and 350,000 tons from the United States.
He said that the country is still negotiating the terms of payment for the soft loans, and other technical issues regarding the shipment of the rice from the two countries.
"We expect that the shipment of the rice will still be within this fiscal year period. If we can secure the soft loans from the two countries we will not need to import anymore during this fiscal year," he added.
Rahardi added that Indonesia also planned to buy between 400,000 and 500,000 tons of rice from Egypt and Pakistan through US$190 million in soft loans from the Islamic Development Bank.
"I am very careful in this matter because we are expecting a very big harvest in March. If the harvest is really big, better than we expected, then we will have to reduce our imports," he said.
Rahardi also said that starting on Jan. 1, 1999, Bulog would lose the privilege of an exchange rate subsidy of Rp 6,000 against the U.S. dollar to import rice.
He added that the government has lifted Bulog's monopoly of rice imports and now allows private companies to import the commodity and sell it directly to consumers to help boost supply on the domestic market.
"Starting Sept.22 general importers are free to import rice, and they are exempt from import duties and value added tax," he said.
CPO tax
Rahardi said that state-owned plantations are free to export crude palm oil (CPO) and its by-products.
His statement helps clarify the ongoing confusion over whether these companies can export their products.
Previously, the government slapped an export ban on these state-owned plantations, forcing them to sell their products domestically.
"The state plantations are free to export (their CPO products) if their products can not be absorbed by the KDI (Indonesian Distribution Cooperative)," the minister said.
The KDI was established in the middle of this year to replace Bulog's role in distributing cooking oil in the country.
Rahardi also said that the 60 percent CPO export tax would still be imposed on CPO exports.
The minister also reiterated that the government would not change or review the export tax on CPO, at least until the Moslem Idul Fitri festivities, which fall on Jan. 19 and Jan. 20 next year. (gis)