TEMPO.CO, Jakarta - President Joko Widodo should not allow his ministers to squabble. This inter-ministerial quarrel has not only led to overlapping rules and implementation chaos in the field, but also reveals a lack of clarity in government policy direction. This is especially true in the area of foodstuffs.
Earlier this year, Minister of Trade Enggartiasto Lukita released his Regulation No. 1/2018 on Provisions on the Export and Import of Rice. Apart from it conflicting with both the Food and Farmers Protection and Empowerment Laws, Enggartiasto Lukita’s new regulation clashes with Minister of Agriculture’s Regulation No. 51/2014 on Recommendations for Exports and Imports of Particular Types of Rice.
Under his Regulation No. 1, Enggar grants state-owned company Sarinah permission to import 50,000 tons of sticky, or glutinous, rice from Thailand and Vietnam by the end of June 2018. Sarinah no longer needed to seek any recommendation from the Ministry of Agriculture or include evidence of the absorption of local glutinous rice products. Sarinah’s action clearly violates Regulation No. 51, which is still in effect.
The Minister of Trade openly said he deliberately cut back the powers of his colleague’s regulation in order to accelerate the import of glutinous rice. He said that he based his decision on the fact that several businessmen using the rice as raw material were screaming as its price had by then almost doubled since mid-December 2017. Currently, glutinous rice sells for Rp21,000 to Rp25,000 per kilogram, whereas in December last year it was still between Rp12,000 and Rp15,000.
This increase in price is suspicious. Minister of Agriculture Andi Amran Sulaiman said Indonesia has achieved self-sufficiency in glutinous rice since 2016. The problem is that the government has no valid data on the production, supply, and demand for this foodstuff. There is also no data on the total area under cultivation to grow it, and when it is harvested.
This situation was possibly taken advantage of by suppliers of this rice variety. Sarinah first submitted its request for an import license in August last year. But Minister Enggar could not issue one because he was prevented by Regulation No. 51 that requires a prior recommendation from the Minister of Agriculture. Amran’s position was clear: no more glutinous rice could be imported. To get around that, Enggar then released his Regulation No. 1 on January 9. Then things went on full speed, since only a week later the import license for Sarinah was issued.
Looking at the timeline, Enggar’s actions seem odd because prices had by then only begun to rise in mid-December, long after Sarinah first requested a permit. That means that when the request was submitted, the price was still normal. Another oddity is that the permit was not exactly what Sarinah wanted, but was rather what importers and traders in glutinous rice had pushed for. Later, the game being played became more obvious, as the distribution of this imported rice was controlled by these businessmen, not by Sarinah itself.
Of course, Minister Amran had a stake in this mess. If only the Ministry of Agriculture had possessed valid data on glutinous rice, none of this would not have happened. The importers or rent seekers, given the price of glutinous rice in Vietnam is only half the normal one in Indonesia, would not have been able to get involved if statistics on local rice existed and were open to public scrutiny. It is possible that the increase in price really was the result of a lack of supplies. In this case, we could properly question Amran’s claim of self-sufficiency in glutinous rice.
President Jokowi must get involved. At the very least, he could assign the Coordinating Minister for the Economy to resolve the problem. If left unchallenged, such issues with glutinous and regular rice supplies will rear its ugly head again in the future.
Read the full article in this week's edition of Tempo English Magazine
