Indonesia : Review rice imports ban

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Meanwhile minister of Agriculture of Indonesia Anton Apriyantono said on Tuesday (9 March) that the government would review its rice import ban in May after the domestic rice harvest, considering that Indonesia would be producing sufficient rice for its own needs this year. If there is any failure (in local rice production), then the import tap will be opened ... but not now, he added.

The government imposed a ban on rice imports early last year as it was optimistic the country would be self-sufficient in this critical product for the first time since the 1980s.

State-owned company Perum Bulog had earlier proposed importing some 300,000 tons of rice, arguing that rice producers would be unable to meet Indonesia's required rice stock of 2.25 million tons this year due to a possible severe drought. The proposal was turned down by the agriculture ministry as the Meteorology and Geophysics Agency (BMG) and the National Institute for Aeronautics and Space (LAPAN) were forecasting that there would not be a long drought this year.

BPS / The Central Statistics Agency estimates that unhusked rice production this year will be 53 million tons, equivalent to 32 million tons of husked rice, while Indonesia's annual consumption is 31 million tons.

Bulog President Director Widjanarko Puspoyo claimed the government had requested that the company buy up more than 7 percent of the rice harvest this year in order to keep prices stable. He said that over the past 35 years, Bulog have only ever bought 7 percent (of the harvest). If Bulog have to buy more than that amount, then Bulog will need to channel the additional supplies somewhere.

According to Widjanarko, Bulog must distribute 1.5 million tons from its stock to maintain the quality of rice kept in its warehouses. In line with this, the government is expected to provide rice allowances for civil servants, and military and police personnel. Anton said that the government would be seeking approval from involved parties on the implementation of this policy.

Trade negotiation team established

The government of Indonesia is establishing a team of international trade negotiators to prepare, coordinate and work for Indonesia's interests on multilateral, regional and bilateral levels of free-trade talks.

"We are preparing a presidential regulation draft on the national team for international trade negotiations with a new structure," Minister of Trade Mari E. Pangestu announced to the public on Thursday.

Currently, there is one national team, specifically for World Trade Organization (WTO) talks.

Mari said Indonesia needed a more integrated team since it was not only dealing with talks at the WTO, but also on the regional level, such as within the Association of Southeast Asian Nations (ASEAN) and with its dialog partners.

Moreover, she added, Indonesia would have more bilateral free trade agreement negotiations.

According to Mari, the national team would be constantly "on-guard" to monitor the development in the international trade talks and ensure Indonesia's interests were properly accommodated in various trade agreements. She said the team would be headed by the trade minister, but there would also be an executive director responsible for daily activities such as preparing and coordinating negotiations as well as managing a strong secretariat to prepare materials for upcoming talks.

The executive director will be the trade minister's special expert staff for international trade.

According to the presidential regulation draft, the national team's board of advisors includes the Indonesian Chamber of Commerce and Industry (Kadin), former Indonesian Ambassador to the WTO and other international trade experts.

Mari said all related ministries were expected to have two dedicated officials on the team, and they would be involved in the negotiations from time to time.

On the multilateral level, Indonesia is constantly dealing with complex negotiations with the WTO. The talks include trade liberalization of farm products as well as industrial goods and services.

While in the regional forum, Indonesia not only has to be prepared for free trade talks within ASEAN, but in the grouping with its dialog partners such as China, Japan, India, South Korea, the European Union, Australia and New Zealand.

Indonesia has also started to pursue bilateral FTA talks with neighboring countries Singapore, Thailand, Malaysia and the Philippines, each of which is more advanced in establishing FTAs with the region's major trade partners such as the United States and Japan.

International and local observers have said that Indonesia possess a strong position in international trade, but lacks domestic coordination and, particularly, an explicit blueprint for country, which make it unable to take full advantage of its position.

Having an "off-guard" stance in the international trade talks -- be it the WTO, regional or bilateral levels -- can create many problems, and result in Indonesia losing out on a lot of potential trade.

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