The Global Food and Financial Crisis Lessons and

The Global Food and Financial Crisis: Lessons and the Way Forward Food Crisis as the Result of Disobedience to Peasants*) Prepared by: Aliansi Petani Indonesia/API (Indonesian Peasant Alliance) *) case study done by VECO & Bina Desa, 2008

Facts related to agriculture during the crisis of food and financial, 2007 -2008: • > 10, 000 hectares per year of agriculture land converted to industrial zones, housing/real estates, and other non agricultural sector. • The conversion keeps escalating since the GOI’s policies give way easier to big industries such as big plantations, housing developers, and other industries to expand their business (e. g. Law No. 4/2004 on water resources, Presidential Decree No 65/2006 on the use of land for the sake of public interest, Law No. 18/2003 on plantation, and Law No. 25/2007 on investment). Those regulations do not protect food and agriculture.

• The rice liberalization has changed the rice production, consumption, and distribution patterns at global and gave impact on national level. Therefore, Indonesia becomes food net importer. • In 10 years (1996 -2005) Indonesia spent Rp. 14. 7 trillion ($ 14. 7 billion) per year to import food, while BULOG (the body that used to deal with logistics) has been privatized under the Lo. I of IMF, it is no longer control to obtain rice and set the price. It’s only control 7% of rice trade in domestic, while the 93% goes to the private (foreign) hands, including Cargill.

• Due to giving the food over to the market mechanism, Indonesia experienced crisis of rice in 1998, crisis of milk, cooking oil and wheat in 2007, and again crisis of rice in 2008. Kupang Pos (December 2007) reported that at least 11, 250 people (adult) and more than 55, 000 children under 5 in East Nusa Tenggara Province alone experienced malnutrition during 20052006. • The crisis of food has also shown how free market failed to provide food to people, in the contrary the number of poor people and the hungry and those who suffered from the sickness related to the lack of food were arose since food liberalization in place.

What has government done to respond the food crisis? The GOI set the “food price stabilization policy” in February 2008, included among others: • To increase the subsidized rice for poor families in 2008 (from 10 kg per households per month to 15 kg to 19. 1 million poor families; subsidized the rice price Rp. 1. 600 per kg (one third of the average of market price); • Reduce the tariff of imported rice from Rp. 550/kg to Rp. 450/kg; • To increase rice production in 2008/2009 by providing certified and good seeds, and subsidized fertilizer;

• To reduce the tariff of imported soybeans and wheat to zero; • To increase the production of soybeans and corn at national through the higher the productivity and expand the areas of planting; • To enhance local grains and tubers production; • To give soft loan with the subsidy to the interest rate to the micro food producers up to Rp. 2. 000 per business unit for 50, 000 micro enterprises. • Promote CSR (corporate social responsibility) to get involved in food security through community empowerment • etc.

Food crisis in the eyes of peasants • Food crisis is when they hardly buy white rice and when the price hike from Rp. 4, 000 per kg (low quality) to Rp. 5, 500 up to Rp 6, 000. The average consumption of rice is 600 gr per day, or 2. 5 kg per day for a family with 4 -5 adult members. Therefore, they should provide at least 75 kg of rice per month, equal to Rp. 450, 000 ($ 45). The hike of rice price will be very hard to them. • Food is rice, not maize, dry land paddy (brown rice), sweet potato, or other tubers from their yards. They have got used to eat rice since it was introduced through Green Revolution in 1994.

Lessons Learned: Sustainable Agriculture as alternative production system against the lack of food and to combating poverty: A case study on organic rice, an incentive for small scale farmers. • Food (rice) should not be treated as commodity. Food is basic right for every person, therefore it is mandate to states to protect, fulfill, and respect it in order to give access to everyone to have healthy, sufficient, nutritious and sustainable food. Government has to protect and give incentives to peasants in terms to achieve food sufficiency for all.

• The starvation in the province showed that the food policy is only on paper. The substance of food problems has not been resolved yet. Local production of food need to be tackeld institutionally politically and economically. Decision makers have to shift their interest not only in mega project such as Jatropha and corn as biofuel which is not proved as a good efforts to overcome famine. In fact, those projects are wiping away the development of local food since the land plantation owned by the people are projected to biofuel plantation • Mutual relationship between peasants and consumers should be developed in order to assure the production of healthy nutritious food, adequate, and sustainable, as well as in active involvement of women in producing, consuming, and distributing it.

• Proactive involvement of several NGOs, such as Bina Desa and others developed sustainable agriculture (organic) together with peasant organizations in rural. Starting from production, consumption and distribution it is based on knowledge, experience, and the innovation of men and women in collaboration with nature. With this practice, the farmers are able to reduce the input cost significantly for they can provide it by themselves by using local natural resources.

• The marketing should benefits to the farmers, since the principal of organic rice is when the production has exceeded the needs of the family of farmers. Then they develop the market that brings benefit to the consumers earn healthy food (social benefits). Through cooperatives with fair trade system they distributed the organic rice to urban areas. • These efforts bring motivation to the peasants to keep producing healthy food sustainably. While the group of peasants can raise fund from the earning to strengthen the institution and to support the operational of the groups.

Thank You