RI Needs Food Crisis Protocol, says World Bank
Wednesday, 23 November, 2011 | 12:06 WIB

TEMPO Interactive, Jakarta:The World Bank has asked Indonesia to prepare a food crisis management protocol to anticipate price hikes next year. “I think it’s necessary although world food price increases won’t be significant,” said World Bank Indonesia senior economist, Sjamsu Rahardja, in Jakarta yesterday.


Sjamsu said the Indonesian government should respond to indications of a food crisis by developing effective procedures. The government, he said, had not promptly responded to ecological changes and pest attacks that affect rice production.


As a result, rice harvests have failed and rice supplies have decreased. Rice is a crucial commodity for Indonesia and any price hikes could harm Indonesia’s most vulnerable.


Previously, the Finance Ministry’s fiscal policy agency head Bambang Brodjonegoro said the government was monitoring food price hikes. “Not because of the consumption increases, but because the supplies were impeded,” he said.


Anticipating rising food prices, Bambang said the government has prepared a Rp15-trillion food subsidy. The fund will be used in unfavorable conditions. If the fund is insufficient, there is a fiscal risk reserve fund amounting to Rp2 trillion. The government also has the chance to increase the food subsidy allocation. If the mechanism is not sufficient, the government could obtain a loan from a foreign donor institution.


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