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Newsletter | When Calling for Food Import Bans, Indonesia Needs a Reality Check!

Dear Readers,

The majority of Indonesians who are Muslims are fasting from sunrise to sunset for the holy month of Ramadan. Although abstaining from consuming food, Ramadan is also about coming together around meals when it’s time to break the fast.

Sadly, it is also a time to trumpet Indonesia’s food nationalism and self-sufficiency aspirations. Self-sufficiency is a view that has strongly taken root in Indonesia that aspires to food sovereignty, resilience, and independence.

The Minister of Agriculture recently floated plans to limit restrictions on imports of soybeans. Soy is the main raw material for the production of tofu and tempeh - important parts of the Indonesian diet and cheap sources of protein for poor Indonesians.

The Minister justified the plan as a way to boost domestic production, shed dependence on imports, and be more resilient to jolts in global prices. Indonesia currently imports almost 90 percent of its soybean needs.

But in this increasingly interconnected world, self-sufficiency will only lead to market distortions and the inability of low-income consumers to fulfill basic dietary needs.

CIPS has been arguing the policy and economic case in our studies that restricting imports is not the solution if Indonesia wants to achieve affordability and access to good nutritious food for the low-income bracket.

Instead, the combination of creating open markets to boost domestic food production and create clear market signals for businesses to import is a more realistic path forward.

Counter to the insular views of ‘protecting’ Indonesia from the world, optimizing global trading and the liberalization of trade in agricultural commodities will have a positive impact on food prices.

Such policies would allow better and quicker responses in dealing with domestic supply shortages or jolts in food prices.

Indonesia also has to show its commitment and seriousness in abiding by international trade pacts. This includes the elimination of non-tariff barriers and other restrictions on trade. It needs to show it’s a cooperative global actor on the world stage. Especially when the country is presiding over this year’s G20.

You can also count on CIPS to continue to argue for constructive and sound policy ideas to ensure Indonesians can access the food they need.

The team thanks you for your support!

Salam hangat,

Rainer Heufers

Executive Director

Center for Indonesian Policy Studies


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