Rini targets farmers well-being, job creation

JAKARTA (JP): Minister of Industry and Trade Rini M.S. Soewandi said on Wednesday that her top policy priority over the next couple of years would be to improve the well-being of farmers, and job creation.

"We will always take into account two things: the well-being of farmers and the creation of job opportunities," Rini said in her first formal media conference since being appointed to the Cabinet earlier this month.

The former top corporate executive, however, could not yet provide details about her policy, reasoning that "such policies will have to be coordinated with other ministries."

Fostering the agriculture sector fits in well with the mission to create jobs.

Indonesia's labor force was estimated at 95.7 million people in 2000, of which 5.8 million were jobless. At least 45.3 percent of employed people worked in the agriculture sector.

But protecting the agriculture sector via tariff or non-tariff barriers, for instance, could move against the rules of the World Trade Organization (WTO), of which Indonesia is a member, and which stipulate the liberalization of the agriculture sector.

Certain government officials had previously expressed support to growing farmer demands to impose non-tariff barriers against imports of rice in order to protect local rice output from cheaper imports.

Recently, the Association of Indonesian Cocoa Exporters (Askindo) also asked Rini to introduce a quota scheme to limit the market share of foreign exporters.

Indonesia's cocoa bean exports this year are projected to reach 275,000 tons, but some 85 percent of them are controlled by foreign companies, which started to dominate the export business following the country's 1997 economic crisis.

Rini also said that to create more job opportunities, the corporate restructuring program would have to be accelerated in order to allow the companies to seek bank financing to expand their operations and employ more people.

She said that she would prioritize the push for the restructuring of heavily indebted huge companies such as petrochemical firm PT Chandra Asri Petrochemical Center and car maker PT Timor Putra Nasional.

Rini also said that her office would produce a list of products and commodities that could help boost the country's exports.

"We are now analyzing products and commodities that are very competitive as exports," she said.

"At the same time we are also analyzing the import content of our export products," she said, adding that she wanted to see what imported raw materials could be substituted by local products, including those produced by the country's small and medium-sized enterprises (SMEs), to create more jobs.

The country's exports are expected to be negatively affected by the global economic slowdown.

In the first half of this year, exports declined 0.18 percent to US$ 29.30 billion, from the same period in 2000.

But Rini dismissed fears that the recent sharp appreciation in the rupiah against the U.S. dollar would badly hit the country's export industry.

"We believe that the impact of the strengthening of the rupiah on the country's exports is temporary," she said, adding that exporters had to make some adjustments to take into account developments in the exchange rate.

The rupiah has appreciated steadily since the appointment of President Megawati Soekarnoputri on July 23. The rupiah closed at Rp 8,600 on Wednesday, compared with Rp 11,300 per U.S. dollar in early July.

"This is a short-term phenomenon. In the long run, this (the strengthening of the rupiah) is good for the country's economy overall," she said.(03)