APSN Banner

Politics behind call for agriculture action

Source
Laksamana.Net - August 29, 2003

As drought continues to grip much of Indonesia, it was little surprise to see agricultural policies in the news last week. Nor was it much surprise to see that one of the people making noise was the chairman of the Indonesian Farmers Association, Ir Siswono Yudohusodo.

Siswono has, by effectively creating his own organization to provide him with a political platform, struck on a successful gambit. Leading some 30 million farmers, albeit without the express consent of those he claims to lead, puts this seasoned Suharto-era politician well and truly on the map.

State news agency Antara had him teamed with the more "respectable" Dr Ir Ahmad Ansori Matjjik, rector of the Bogor Agricultural Institute of Bogor (IPB), in a recent seminar. Siswono was quick to launch an attack on the country's agricultural policies – or lack of the. "There is no such a concrete agricultural policy, which really takes side with the farmers in this country," he intoned.

His comments, supported by those of Dr. Ansori, stressed that the government continues to adopt policies designed to restrain basic food prices, essentially at the expense of the farmer.

"The government tends to increase imports more rather than give subsidies for domestic interests, including the agricultural sector," Siswono said. He argued that the government should provide more protection for the agricultural sector.

Fine, if massaging the damaged pride of the farming population is the only aim. Siswono, politician that he is, did not admit that the government is in a quandary over how to improve the lot of farmers.

Instead, Siswono said Indonesia should follow the example of Japan, where farmers were protected to the point that rice could sell on the market for 50,000 rupiah per kilo. "What has happened in Indonesia is the other way round," he said. "The price of rice is intentionally set low in order to reduce the inflation rate. But, the country's farmers remain in poverty."

Siswono did not hesitate in attacking the government for "giving more subsidies to strong men" while ignoring farmers. Exactly who he was referring to is unclear, but the comment was in line with his populist pro-farmer statements since his creation of the Farmers Association.

Siswono continued with his criticism, apparently designed to erode confidence in the government in a manner that suggests he continues to owe allegiance to Golkar Party in his new reincarnation as the voice of the farmers.

On subsidies, his comments make little sense even though farmers might fancy the prospect of driving around in Jaguars and other fancy cars as returns on rice growing skyrocket. The reality is unlikely, however. Land-starved, over-populated Japan is hardly a viable comparison with Indonesia, especially on agriculture.

More appropriate is government action on the significant levels of smuggling of rice and other agricultural commodities into the country. Recent action by the National Logistic Agency (Bulog) in Malaysia and at home suggests that as much as half of Indonesia's rice imports are smuggled into the country.

Until this is stopped, Siswono can complain as much as he likes about the lack of subsidies, since smuggled rice and other products will continue to undermine prices. And stopping smuggling is not easy, with some 600 ports spread across the country overseen by customs and other officials whose honesty cannot always be guaranteed.

Siswono had a more valid comment when he said it was ironic that Indonesia had failed to take a role in international marketing mechanisms. With 40% of the world crop of white pepper, Indonesia should have been able to control the world price for the product. But, said Siswono, "due to government's lack of attention to farmers, it is Indonesia which has to obey the price set by other countries for this commodity."

There are, of course, historical reasons for the domination of trading systems by other nations that are not so easily overcome as Siswono would suggest.

Dr Ansori's comments were somewhat more restrained yet he did accept that the failure of the agricultural sector to make progress was the result of the lack of commitment from government to make it a platform for economic development.

The resilience of the sector through the economic crisis demonstrated that it was a valid candidate for more attention from government, he added. At the moment, he said, there was a "vacuum" in terms of commitment.

Dr Ansori has to be given the credence that his position as rector deserves, even if Siswono is merely beating a political drum in stirring up farmers to what he says are their rights.

In defense of the government, it has made considerable noise on an issue that directly affects the plight of farmers – protectionist policies imposed by developed nations. Japan is just one example of a rich nation that coddles its farmers by putting high barriers up against agricultural imports, while Europe and the United States are justly famous for the subsidies paid to their farmers.

The World Trade Organization (WTO) meeting at Cancun in Mexico later this month is likely to be make or break time for the WTO and its claim to offer a just system of trade.

It's not only countries such as Indonesia that are unhappy with the global market for agricultural products. At the end of July, a group of key Cairns Group countries delivered an ultimatum on the global trade talks, saying that they would abandon global trade negotiations if there was no cut in protectionism.

Nine of the 17-nation Cairns Group reaffirmed their determination to walk away from WTO efforts to get stalled global talks back on track if there was no sign of a willingness to bend on the part of the protectionist nations.

Talks are stalled over conditions to progressively reduce export subsidies for agriculture and on access to markets, key issues for poor countries concerned over their ability to compete in the global marketplace.

In the end-July statement, a spokesman for Australian Trade Minister Mark Vaile, chair of the Cairns Group, said the nine nations were serious that there would be no WTO deal without cuts in farm protection.

"The Cairns group was firm that if the current round doesn't deliver something substantial in terms of agriculture, they will walk away," Vaile's spokesman said. He singled out the European Union and the US as "two of the world's worst offenders in terms of agricultural subsidies".

Indonesia, while not part of the nine countries making the stand on protectionism that Vaile referred to, has been waging its own campaign on behalf of developing nations.

In its latest salvo, Minister of Industry and Trade Rini M.S. Soewandi said in a speech to a business meeting in Islamabad last month that both Pakistan and Indonesia had been forced to watch their economies stumble forward, as protectionist policies hindered their ability to develop to their full potential.

"It is our belief that the potential of the south countries continues to be undermined by the industrialized countries," she said, calling for south-south cooperation as a means of side-stepping some of the problems associated with continuing protectionism. Developed nations had demonstrated "little will to assist us in our struggle to provide reasonable returns to our farmers and other producers," she said.

This is more to the point that the electoral tub-thumping of Siswono Yudohusodo. Regrettably for the government, Siswono's subsonic hysterics are likely to be more easily understood by farmers than the government's genuine attempts to battle with the Goliath of international protectionism.

Country