June 12, 2008

Indonesia to launch investment policy to boost grain production
   
  

The Indonesian government is preparing to launch an investment policy in the food sector to boost production of important staples such as corn, soy, rice and cassava, a senior economic official said on Tuesday (June 10, 2008).

The government is conducting a study for the formulation of a policy that will enable medium and large-scale companies to enter the food sector, according to Bayu Krisnamurthi, deputy for agricultural and marine affairs to the coordinating minister for economic affairs.

The move would boost national food production, Krisnamurthi said, continuing that there is currently no investment in the food sector but this will be changed and they will be cautious so that the farmers' interest would not be harmed.

The government would encourage investment in the food sector, especially in regions where agriculture is not well developed.

Krisnamurthi said soaring world food prices had boosted investors' interest in developing the food sector, with investors from the Middle East recently expressing interest. He further said Middle Eastern investors consider Indonesia's food sector to be one of the most attractive areas.

Indonesian trade minister Mari Elka Pangestu said the government is improving its partnership with the private sector to encourage investment in the food sector.

The Indonesian Chamber of Commerce and Industry is currently drawing up a plan to increase arable land acreage, according to Pangestu.