Category Archives: Investment

IRD2014, SA-based Indonesian researchers’ contribution to policy discussions

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GoLive Indonesia and Indonesian Student Association South Australia chapter (PPIA-SA) co-organised the 2014 Indonesian Research Day on Wednesday, 23 April 2014. The event was attended by more than 50 participants from three universities in South Australia, namely the University of Adelaide, University of South Australia and Flinders University.

Professor Christopher Findlay, Dean of Faculty of Professions at University of Adelaide, in his keynote speech on the Australia-Indonesia bilateral relationships reinforced three principles needed to improve bilateral relationships between the two countries, namely economic integration, ‘no-surprise’ policy and consultations and respect.

The President of PPIA-SA, Mr Dias Satria, also a PhD candidate at University of Adelaide, expressed his confidence that with the support from various organisations in SA this event will be held annually.

For GoLive Indonesia, this is the third event that the project has co-organised following succesful PhD conference in Canberra  partnering with Indonesia Synergy in November 2013 and early career researcher conference at Bogor Agricultural University in March 2014 collaborating with InterCafe.

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Filed under Australia, Conference, Economic development, Economic Integration, Education, Indonesia, Infrastructure, Investment, PPIA academic discussion, Trade

2013 Food Security Regional Dialogue-Medan: Inter-economy perspectives of food security scenarios

As part of promotion of evidence-based policy making, decision makers and researchers have applied a wide range of modelling to evaluate the effectiveness of food security programs. One widely applied model is a multi-country computable general equilibrium model or known as the GTAP.  Anna Strutt (University of Waikato) and Signe Nelgen (University of Adelaide) shared their work entitled “Food security scenarios for the Asia Pacific – inter-sectoral and inter-economy perspectives”.

Anna Strutt (University of Waikato)

Anna Strutt (University of Waikato)

Strutt and Nelgen’s study focuses on CIPTTV countries, namely China, Indonesia, Philippines, Chinese Taipei and Viet Nam aiming to capture the impact of potential policy changes and other external shocks. The study uses an economy-wide framework using a computable general equilibrium model, a global trade model GTAP. Some important features of the modelling include: attention is given to the structural detail of the economy and inter-relationships between sectors; Prices and quantities are determined simultaneously with markets usually are assumed to clear; Incomes are endogenously determined; There is optimising behaviour by consumers and producers, with prices inducing adjustment. The CGE model imposes constraints e.g. availability of factors of production.

The GTAP model and the latest available GTAP version 8.1 data base with a base year of 2007 for 134 countries/regions and 57 sectors are used. Aggregation is implemented to derive 25 sectors and 28 regions in the study. The data are first projected to 2015. Agricultural distortions by Anderson and Valenzuela (2008) are updated and mapped to the GTAP sectors. Bilateral preferences from the GTAP database are maintained. To better capture food security aspects, the study augments the GTAP with food nutrition data using kilocalories per day per person.

Signe Nelgen (University of Adelaide) to explain about agricultural distortions dataset

Signe Nelgen (University of Adelaide) to explain about agricultural distortions dataset

Five scenarios are being simulated for the CIPTTV region: 1) improved agricultural productivity (land consolidation may lead to a 5 per cent increase in TFP in land-using sectors; 2) increased rice self-sufficiency through increasing tariffs imposed on imports from all regions thus eliminating 99 per cent of rice imports; 3) Combination of 1) and 2); 4) increased rice self-sufficiency and retaliatory tariffs from a key rice exporter; and 5) natural disaster harming land productivity which is assumed to lead to a 5 per cent reduction in land productivity in the region.

The study concludes that policies to promote self-sufficiency through the use of protectionist trade policies such as tariff may lead to a worsening of key food security indicators such as household food consumption. But if agricultural productivity improvements are part of the policy mix, the impacts will be less severe. However, retaliatory trade policies are likely to worsen conditions.

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Filed under Agriculture, Conference, East Asia, Economic development, Economic Integration, Food and agriculture, Investment, Methodology, Trade

2013 Food Security Regional Dialogue-Medan: Food security situation and policy in Indonesia

Rice in Indonesia has been considered to be not only main staple but also perceived as a cultural symbol of prosperity. Lumbung or rice barn was often used as a symbol of food security achievements. Current government approaches to food self-sufficiency still puts rice self-sufficiency as a key part of its national agenda. Ronnie Natawidjaja and Irlan A. Rum of Center for Agrifood Policy and Agribusiness Studies (CAPAS) – Padjajaran University reported food security situation and policy in Indonesia.

Ronnie Natawidjaja's session was moderated by Randy Stringer (University of Adelaide)

Ronnie Natawidjaja’s session was moderated by Randy Stringer (University of Adelaide)

New Food Law 2012 explicitly states that food security in Indonesia has to be based on domestic food availability and food sovereignty. Food self-sufficiency is defined when 90 per cent of consumption can be met by local production. The logistics agency or BULOG imports 10 per cent to stabilise the rice price. Unfortunately, there is no clear rule about when and how much Indonesia must import rice. As a consequence, policy responses are often coming late and this issue often creates policy debate and uncertainty in markets. Also, the rice domestic market is isolated although rice price has been generally stable (but higher than the international price level). Data from Coordinating Ministry of Economy also suggest that food subsidy for the poor has been increasing since 2007.

According to the Food Law 18/2012, food security is defined as a situation when individuals at all times have physical, social and economic access to sufficient, diversified, safe and nutritious food that meets their dietary needs, food preference and religious requirements for an active and healthy life. However, food security is often misunderstood as securing or protecting our food need and food self-sufficiency is often seen as the only solution.

Data from Statistics Indonesia (BPS) suggest an increasing trend in expenditures on prepared food (as a share of total household expenditure) and decreases in rice expenditures. The trend is related to urbanisation, supermarket transformation and increasing middle income class in Indonesia.

Whilst there has been a decreasing trend in rice import, rice prices continue to increase in the last years. In addition, regional variations exist. Eastern part of Indonesia, in particular Papua, has the biggest challenges to achieve food security due to the lack of infrastructure and low production. Ronnie views that some policy options to achieve food security should include effective trade policy, input and food subsidies, price stabilisation policy, government procurement and reserve stock policy and rice for the poor policy (Raskin).

Two issues that have not been discussed at the session are the following. First, given the increasing role of regional govenrments whether food security is seen as a ‘regional agenda’ where regional (provincial) governments have responsibilities to ensure their regions achieve food security, often be expressed as food self-sufficiency. If it does, regions with low production or with problems accessing food from production areas (due to distance and the lack of infrastructure) will be at risks. Secondly, whilst rice remains the main food commodity there is increasing demand for other food commodities such as animal-based protein sources such as beef and dairy products. One major concern is whether the Indonesian government uses the same quite costly self-sufficiency approach to these commodities. Early observations suggest that the government does.

*This summary was written by Risti Permani (Global Food Studies, University of Adelaide) and may be subject to her personal views.

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Filed under Conference, East Asia, Economic Integration, Food and agriculture, Indonesia, Investment

Challenges and Opportunities for Indonesia and Australia Relationship in the Asian Century

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On 17 May 2013, Counsellor in Politics and  Senior First Secretary of Economic Affairs of The Republic of Indonesia Embassy in Australia, Mr Widya Rahmanto and Mr Denny Lesmana shared some valuable  insights into  “Challenges and Opportunities for Indonesia and Australia (IA) Relationship in The Asian Century”. This discussion forum was organised by the Indonesian Embassy, South Australian Chapter of The Indonesian Student Association (PPIA), and fully supported by  PPIA at Flinders University, University of Adelaide and University of South Australia and  GoLive Indonesia.

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Filed under Agriculture, Australia, Culture, Democracy, East Asia, Economic development, Economic Integration, Education, Employment, Food and agriculture, Indonesia, Infrastructure, Investment, PPIA academic discussion, Services, Trade

ASEAN Economic Integration: Challenges and Strategies

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Kiki Verico, Faculty of Economics University of Indonesia

Southeast Asia is among the important pillars in Asia’s economic integration whereby ASEAN is expected to gain solid economic integration from trade and investment. This would mean that ASEAN must have significant and positive relations in her intra regional trade and intra regional investments. Yet a previous study finds them to be significant nevertheless having negative relations (Verico, 2012). Given its long-run economic integration objective, ASEAN must turn this relation into one that is significant and positive. This will require an economic convergence by which an equivalent level of playing field within its member states.

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Diversity of Media=Diversity of Content?

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Anang Sujoko, Brawijaya University 

In Indonesia, after the resignation of President Soeharto (1998), the freedom of expression has encouraged the media development. The mass media, including print media and broadcasting media, has significantly grown. For instance, the number of private television stations went up from two stations in 1998 to 11 national commercial network stations and hundreds of local commercial TV stations (Davis 2013). In addition, there are currently one thousand print media (newspaper, tabloid, and magazine) with 25 million copies.

In Indonesia, mainstream media, including print and broadcasting, play the important role in shaping or directing Indonesians’ points of view and life. This article briefly reviews the importance of media and how the media works,  and investigates whether diversity of media leads to diversity of content.

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Filed under Culture, Democracy, Investment, PPIA academic discussion, Social media

The Legacy of the Past for Current Agriculture

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Agus Pakpahan,PhD Chairman of the Union of Estate Crops Farmers Associations

Indonesian agricultural sectors have a long history. This article briefly reviews agricultural development from the colonization era to the post-independence period.  Whilst the colonial agricultural development approach to use forced-agenda through VOC monopoly power and Tanam Paksa (enforcement planting) was no longer relevant to current agriculture, the colonial era has passed on the legacy of a ‘grand design’ that has not changed much, that is to focus export-oriented agricultural commodities such as rubber in Sumatera and main food commodities such as rice in Java and to provide necessary infrastructure to achieve agricultural development goals including research institutes and irrigation networks.

 

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Filed under Agriculture, Culture, Economic development, Food and agriculture, Indonesia, Infrastructure, Investment, Trade