TEMPO.CO, Jakarta - The National Food Agency or Bapanas stated that the food aid program is able to suppress the inflation rate amid the fluctuating rice prices in Indonesia following declining production triggered by the extreme dry season.

However, according to the head of Bapanas Arief Prasetyo Adi on Thursday, distributing food aid across the country is indeed a challenge, considering there are 17,000 islands in Indonesia.

Arief claimed the program has reached 1.5 million locations across Indonesia. “It is proven that our inflation is at 2.8 percent y-o-y per November, which is better than other countries,” he said in a statement.

He explained that the first food aid period from March to May was delivered to 21.3 million beneficiary households that received 10 kilograms of rice each month.

According to Statistics Indonesia or BPS, the inflation rate in March decreased to 0.7 percent from the previous month's 2.63 percent. It then steadily declined in April to 0.55 percent and 0.02 percent in May.

"Considering the positive impact toward the inflation rate, the rice assistance continued from September to November," Arief said.

The rice inflation rate in November slowed down to 0.43 percent after a temporary halt of the aid caused it to hike.

The food aid program will be pursued until June 2024 according to Arief.

The program also helps with economic growth, which is currently stable at 4-5 percent. Meaning, Indonesia's economic growth surpasses its inflation rate.

The executive director of Bulog, Bayu Krisnamuthi, said that controlling the inflation rate by implementing a food aid program is a smart decision. "Going forward, we will continue to implement this strategy and one of the requirements is having a sufficient [rice] stock," he said.

The government has authorized Bulog to import around 2 million tons of rice in 2024 while simultaneously absorbing domestic rice production.

While unable to decrease the rice prices, Bayu claimed, the government is successful in suppressing the inflation rate and controlling the fluctuating prices.

AMELIA RAHIMA SARI

Click here to get the latest news updates from Tempo on Google News