As Rice Prices Soar, Number of Poor Will Increase
Tuesday, 19 December, 2006 | 17:07 WIB

TEMPO Interactive, Jakarta: Rusman Heriawan, Head of the Central Bureau of Statistics (BPS) has said that the rice price increases have the potential to increase the number of poor people.

This is because one of the factors in determining the poverty limit is through food consumption.

According to Rusman, rice is a basic need for poor people and the majority of their small incomes are used to buy rice.

Rice price increases up until December 16 already reached 11.5 percent.

“If poor people’s incomes haven’t changed, they must spend more to buy rice,” he said.

Rusman also estimated that the rice price increases will lead to an increase in inflation.

The rice component contributes around 0.66 percent to inflation.

This is based on the assumption that all prices of goods and services do not go up apart from rice.

“But if other the prices of goods and services also rise, inflation could be above 0.66 percent,” said Rusman.

However, he said he was optimistic that until the end of December, inflation would be below eight percent.

In addition, following the market operations, the trend for rice price to increase has started to decline.

The government may import rice early next year.

This is because, according to Bayu Krisnamurti, Deputy II of Agriculture and Maritime Affairs Coordination at the Economy Coordination Ministry, now the price has risen too much and national rice stocks are lower.

Bayu said, in addition to market operations, rice imports are to procure cheap rice for the poor and this will be accelerated to January 1-2 from mid January.

The government is currently calculating the demand, price and requirement of regions which will obtain a portion of the imported rice.

Kurniasih, Riky, Anton, Sujatmiko and Ewo