Monday, 23 September 2019

AEC Ahead; Indonesian Rice Most Expensive in ASEAN

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  • Ilustrasi M.E.A. (Masyarakat Ekonomi Asean)/ Asean Economic Community.

    Ilustrasi M.E.A. (Masyarakat Ekonomi Asean)/ Asean Economic Community.

    TEMPO.CO, Jakarta - The ASEAN Economic Community (AEC) is just around the corner. Wahyu, director of procurement at Perum Bulog, said Indonesia needs to review its preparation in welcoming the AEC, particularly regarding the food industry.

    According to Wahyu, Indonesia's rice price is the highest among ASEAN member countries. "Meanwhile, our government pays the highest rice subsidy in Southeast Asia," he said on Monday, December 28, 2015.

    Wahyu highlighted Cambodia and Myanmar when it comes to rice management. The two countries used to have rice prices that are higher than Thailand. Nowadays, rice from Cambodia and Myanmar are cheaper than Thailand's.

    Wahyu said that rice farmers in the two countries made good improvements, and they are ready to face the ASEAN free market era.

    On the contrary, Indonesia's rice price is the highest in ASEAN, which will make it difficult to compete during the free market era.

    "This [is an issue] that requires reviewing," he said.

    Indonesia's farming sector receives the highest amount of government subsidies in Southeast Asia. In Thailand, rice subsidy is Rp1 million a year, while Indonesia's is Rp5 million per year.

    Wahyu said the government needs to review the effectiveness of rice subsidy distribution and focus on protecting farmers. One of the most effective ways to do that, he said, is by purchasing harvested crops for a decent price. That way, Indonesian crops can compete with other ASEAN countries' in terms of selling prices.