The Government stated pressures from imported food increased in 2014, because the global food condition indicated recovery and was more competitive. The improved global condition was seen in increased world’s GDP from 2.1% to 2.8%. The growth was expected to happen in Indonesia’s trading counterparts among others the USA, Uni Europe, China, and India. Besides the world’s food reserves was also predicted to increase, around 1.4% for wheat and 10.1% for rice. The increase of world’s food reserves made the world more secure.
If global production increased, most probably price of food would go down. Meaning it was opportunity for importers to import food massively. Depurty Minister of Trade Bayu Krisnamurthi stated on Thursday [16/1] restriction of essential goods would still be Government’s homework this year. Moreover it was in line with growth of demand at home which was today no longer centered in big cities.
Bayu explained that the hardest task in trading for 2014 was to tame inflation. Such was because domestic economy was still the backbone of national economic growth. “We predict domestic consumption would grow between 7% - 19% with broad range including F&B, electronics, housing, cosmetics, garment, footwear etc.” Bayu concluded.
Due to hard challenge of controlling inflation, Bayu stated that various basic need had to be imported this year as domestic supply was still below demand. Import pressures of food was a serious challenge domestic agriculture. For that matter this year the Government planned to spur on production output to keep up worth demand. Bayu admitted he just had to adopt import policy to maintain price stability in the market. Such was his respond to criticism addressed to the Ministry of Trade who tend to choose to import food, which made the domestic market to be stormed by imported food.
He underscored that import was only exercised to stabilize prices. For example, price of garlic would be beyond control if the Government did not adopt importing policy. National garlic consumption in 2013 was 400,000 tons, yet national production was only 20,000 tons. The task of the Ministry of Trade, Bayu said, was to jack up food productivity as many agro products were low. According to Bayu, if the Government did not take to importing garlic, price of garlic might soar up to Rp 50.000.- per kg while inflation rate had broken through 8.3%.
Meanwhile the Indonesian Executive Director for Global Justice reza Damanik said that supposedly the Government could reduce dependency on importing of non oil-gas commodities especially food so trade balance could be improved. He said that the main cause of deficit in trade balance was import of oil gas products, but import of non oil-gas products was not less determinant. Therefore the setback could begin from dependency on import of non oil-gas products, especially food.
Data of the Ministry of Trade had it that since 2009-2012, Indonesia’s import of food posted increase up to 100.4% from USD 8.42 billion to USD 17.8 billion. The highest increase was posted mainly in coffee, tea and chili which jumped up by 425.12% from USD 62.1 million in 2009 to USD 326.1 million. Cereal increased by 146.6% from USD 1.5 billion to USD 3.7 billion. Besides import of sugar and sugar testis also increased from USD 704.6 million to USD 1.8 billion; the same was with seeds and cereals which increased from USD 826.9 million to become USD 1,491 million, flour became USD 645.7 against 2009 which was still around USD 353.9 million. (SS)
Business News - January 22, 2014