Rini unwilling to ban rice imports
Rini unwilling to ban rice imports
Adianto P. Simamora, The Jakarta Post, Jakarta
Minister of Industry and Trade Rini MS Soewandi is reluctant to
impose a ban on rice imports as such a move would violate World
Trade Organization (WTO) laws, and create a heavier burden on
consumers at home in the form of higher prices.
"I have to be very careful about it (halting rice imports),"
Rini told reporters on Monday.
Last week, the president of state-owned logistics company
Bulog, Widjanarko Puspoyo, demanded the minister ban rice imports
in a bid to avoid oversupply at home during the current harvest
season and protect the interests of local farmers who were unable
to compete with cheaper imported products. The ban must last at
least until September.
Rini said the request would be difficult to implement as it
would breach WTO laws, which allows member countries to impose
import tariffs but forbid them from imposing trade barriers.
She said a complete ban on rice imports would send the price
of the commodity higher at home thus creating a burden on local
consumers. Rice is the main staple of the country's more than 220
million people.
She said that based on the experience of her latest policy of
regulating the sugar trade at home (which has recently
contributed to the surge in sugar prices here), the government
should avoid regulating the trade of strategic commodities.
Under Rini's sugar policy, only a select number of companies
are allowed to import sugar in a bid to help avoid oversupply.
Rini said her office was now studying other mechanisms to
protect local rice farmers during the current harvest season, but
mechanisms that did not breach WTO laws.
"I still have to discuss this with other related ministers,"
she said, declining to provide details.
Previously, the Ministry of Agriculture and also the
Indonesian Farmers Association (HKTI) said the government should
raise tariffs on rice to help limit the entry of cheap imports.
But Bulog argued that raising tariffs would not be effective
amid the current condition.
Widjanarko said that Bulog's warehouse facility had a limited
capacity to absorb farmers' output.
The price of unhusked rice at farm level has dropped to around
Rp 800 per kg compared to the government's target of Rp 1,500 per
kg. Many blame this on the inflow of cheap rice products from
overseas.
The country's unhusked rice output this year is expected to
reach some 52 million tons (or equal to about 32 million tons of
rice).