Remarks of President of the Republic of Indonesia at the Opening of 2021 National Working Meeting on Agricultural Development, 11 January 2020, at the State Palace, Jakarta
Date 11 Januari 2021
Assalamu’alaikum warahmatullahi wabarakatuh,
Peace and prosperity be upon us,
Greetings of virtue.
Distinguished Coordinating Ministers, Ministers, Vice Ministers, Presidential Chief of Staff, Honorable Governors, Regents, Mayors, and all Echelon I, Echelon II Officials of Ministry of Agriculture, Heads of Offices at the regency / city level throughout Indonesia,
Honorable participants of the National Working Meeting,
Ladies and Gentlemen,
Amid COVID-19 pandemic, agricultural sector plays an increasingly more important role. We are aware that the Food and Agriculture Organization (FAO) has warned of a looming food crisis. Be mindful of this. Global food distribution has been constrained due to restrictions on people’s mobility, including goods distribution between countries. And we know that in the past few weeks, supply of tofu, tempeh, and soybeans has become an issue because of what I mentioned earlier.
We know that Indonesia has a population of more than 270 million people. Therefore, we have to take food management seriously. We have to take agricultural development seriously and in detail, especially, let me underline, with regard to imported agricultural commodities. Do pay serious attention to soybeans, corn, sugar, and garlic since we are still importing millions of tons (of those commodities). We have not imported rice for almost two years. I want to see what conditions are on the ground, whether we will consistently do it for the coming years. But like what I said earlier, matters related to garlic, sugar, corn, soybean, and other imported commodities must be addressed and we must pay attention to this and immediately seek a proper design to address it.
I do not think we can do conventional, routine, monotonous things any longer like we have been doing for years. We have to build an area that is on an economic scale, no longer small. That is why I order completion of this food estate, at least this year in North Sumatra and in Central Kalimantan. We want to evaluate what the problems are on the ground, barriers in technology, and also by means of technology, not conventional ones for this food estate. If the food estates work, it can set as an example for all provinces to cultivate coffee but on a broad scale (economic scale). So it is useless we can produce but in a small scale. It will not affect those imports.
The problems we have been facing from the past until today are, first, we know that soybeans can grow well in Indonesia but why are our farmers not willing to grow them? Because the price is lower than that of imported soybeans. If farmers are told to sell the commodities at an imported price, the production costs do not cover so it must be in large quantities so the price can compete with that of imported ones.
Next, garlic, why do we used to produce so much garlic and now our farmers do not want to grow them? Because the price is lower than that of imported ones. Wonosobo used to be a major producer of garlic and so was West Nusa Tenggara province. Why it can’t it be expanded in a large quantity so that (the price of domestic) garlic can compete with the import prices. There is a competitive price. If the price is not competitive, it will be difficult to compete.
So once again, this must be developed in a very large area. We still have plenty of lands so we must look for suitable lands for planting soybeans. Not in one hectare, two hectares, ten hectares but in 100,000 hectares, 300,000 hectares, 500,000 hectares, 1 million hectares of land.
The same goes for corn. We must look for lands that can still be planted on a large scale. This will address the matter. I realize it is important to address matters of fertilizer, seedlings. But if we can prepare a large amount of land, the matters will be addressed.
As for fertilizer, for how many decades have we subsidized fertilizer? How much have we spent for fertilizer subsidy every year? Rp30 trillion-something? How much is it, Minister of Finance? As far as I can remember, it is Rp33 trillion every year. What’s the return? What do we receive? Has the production increased? Rp33 trillion, I ask what’s the return? How many trillions for five years? Ten years? Ten years mean Rp330 trillion.
Ladies and Gentlemen,
It is a substantial amount of money. This means an evaluation is needed. Indeed, something has gone wrong. I have asked (to look into) the matter several times.
Those are the methods of agricultural development that we must aim for – on a broad scale (economic scale). Agricultural technology must be properly used so the production costs can compete with the same commodity prices from other countries. That is a correct way. If we set aside a large amount of money for fertilizer subsidy every year; yet, there is no growth in production, then something is wrong indeed.
I truly appreciate a positive growth in the agricultural sector, especially exports. However, bear in mind that much of our exports come from palm oil. Isn’t it true, Pak Coordinating Minister? Be careful, not from other commodities that we have injected with existing subsidies.
That concludes my statement on this auspicious opportunity. I urge that this be well executed on the ground so later if the food estates in these two provinces (North Sumatra and Central Kalimantan) run successfully, we will encourage other provinces and we will provide funds from the State Budget, but there must be economic returns to the state.
And by saying bismillahirrahmanirrahim, I declare the 2021 National Working Meeting on Agricultural Development officially open.
I thank you.
Wassalamualaikum warahmatullahi wabarakatuh.