RI to cut import duties on sugar

RI to cut import duties on sugar

Aloysius Unditu and Arijit Ghosh, Bloomberg, Jakarta

Indonesia, the world's third-largest sugar importer, will cut the
import tariff on the sweetener by as much as 54 percent to lower
costs for poor Indonesians after kerosene prices were tripled.

The government will cut the import tariff on raw sugar to Rp
250 (2 U.S. cents) a kilogram from Rp 550 a kilogram from
November, Coordinating Minister for the Economy Aburizal Bakrie
told reporters at a midnight briefing in Jakarta. The government
will also raise the procurement price of unhusked rice by 30
percent from January.

"It's aimed at helping Indonesian consumers and small and
medium enterprises," he said.

President Susilo Bambang Yudhoyono, who is facing opposition
from consumers in the world's fourth-most populous nation after
promising a 29 percent price increase in March would be the last
this year, is trying to ease the burden for poor Indonesians by
cutting import tariffs on sugar before the Idul Fitri Muslim
holidays in November.

Indonesia almost tripled kerosene prices from Saturday to cap
energy subsidies. Susilo raised the price of fuel, which was
being sold at less than half of the cost of imports, to reassure
investors who last month sold the nation's currency and stocks as
the subsidy bill surged.

Indonesia's sugar imports may surge 24 percent to a six-year
high in the coming 12 months as local suppliers struggle to meet
growing demand for the sweetener, a U.S. government agricultural
report said in April.

Indonesia will probably buy the equivalent of 1.8 million
metric tons of the commodity in the year ending April 30, 2006,
the U.S. Foreign Agricultural Service in Jakarta said. That's up
from 1.45 million tons a year earlier and the highest since 1999-
2000.