Agriculture Reference
In-Depth Information
to withstand the 2008 global financial and food crises is a case-in-point. In Indone-
sia, increased agricultural production, successful price stabilization at the consumer
level, and trade controls thwarted the upward pressure on prices that might other-
wise have been expected due to instability of rice supply in the world market. Des-
pite prices doubling in international markets, domestic prices increased by only ten
per cent. Indonesia ahieved international recognition due to these relatively stable
prices, with its national rice stoks remaining afordable. Certainly, Indonesia was
able to avoid the food riots that occurred in other parts of Asia, Africa and Latin
America. In this situation, it was possible for the government to maintain sufficient
buffer stoks of rice due to good levels of domestic production, thereby preventing
further speculation or hoarding.
To ahieve this, the Indonesian government took a number of measures to limit
the domestic impacts of the 2008 food crisis (taken from FAO, 2009). These included:
removing import duties on wheat and soybean imports; providing soybean subsidies
to producers of tofu and
tempe;
relaxing the VAT (value-added tax) for wheat flour
and cooking oil; and increasing the fertilizer subsidy by 240 per cent. In terms of food
accessibility, the government increased rice subsidies through RASKIN both in terms
of programme coverage and the size of the subsidy, and introduced direct cash sub-
sidies for the poor. This mix of policies and financial incentives provided household-
level benefits, but overall Indonesia's relatively strong food security in 2008 was built
on the level of price control made possible through solid domestic production.
The global food crisis of 2008 has been interpreted by many as an early warning
sign of global economic conditions in the years ahead, as Indonesia and other coun-
tries are expected to grapple with the vagaries of climate hange and its impacts
on food production. In this context, having national control over the life source of
the nation holds both emotive and practical appeal. The collective national memory
of Indonesia's inability to buy food on the world market in the 1960s (and hence
the perceived need to be self-sufficient) is juxtaposed over the experiences of local-
ized food shortages and famine (suh as those in Yahukimo) caused by entrapment
in a subsistence economy and isolation from broader trade and social networks.
These two typified experiences, and the complexities of addressing food insecurity as
multi-scalar phenomena, are driving what may seem to be contradictory policies at
national and regional levels. Singularly prescriptive policy approahes suh as 'self-
sufficiency at all costs' or 'full liberalization of agricultural markets' are unlikely to
solve the food security conundrum in Indonesia. Food security is most likely to be
