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Manufacturing Hunger: Indonesia’s Food Crisis

Tuesday, September 30, 2008

Report and Photos by Andre Vltchek*

September 2008

Pasar Baru (New Market) at the outskirts of the city of Porong in East Java is a temporary home to many refugees from Lapindo Brantas land slide – a calamity that occurred more than two years ago. Approximately 2,000 people are using this enormous market site, just a few kilometers from the disaster area as their temporary refuge. Even inadequate compensation package of about US $6,500 is continuously delayed. Men, women and children live in unhygienic conditions, sleeping on what used to be the market stalls, sheltered from each other by plastic sheets. They have very limited access to potable water, medical care and electricity.

Their hardship is extreme, but to many, it is symbolic of the situation in Indonesia today. For the country’s poor, Indonesia is plagued by an indifference towards the poor, lack of protection for the majority, stagnating salaries, and constantly rising fuel, land and food prices.


“My husband was a ‘becak’ driver (motorcycle taxi),” explains Ms. Nur Kholifah from Kedong Bendo, the first village inundated by the mud from Lapindo Brantas mine. “Now he has to look for work elsewhere – he hasn’t come home for 3 days. I had to sell my gold jewelry in order to buy food for the family. My mother died 3 weeks ago – she used to be healthy: I think she died from stress. I don’t know how we are going to survive.”

Some people have come to rely on charity while the others turn to begging. Food is on everyone’s mind. Disaster victims have spent almost everything on food and still remain hungry. But even the average Indonesian household is now spending around 50% of the earnings on feeding itself. Central Statistics Agency (BPS) data shows people spend 54 percent of their income on food.

Five hundred kilometers away in Bali, at the luxury resort Le Meridian, also known as Nirwana Bali, housekeeper Suryawan laments: “We have to work much harder now. Families have to be fed. School fees have to be paid. Just to buy basic food for two adults and two children we have to pay Rp. 50,000 (US$ 5.50) per day.” That is in the country where over one half of the population lives on less than U.S. $2 a day.


It is very difficult to evaluate exact extent of the poverty rate in Indonesia – one of the worst in Asia – as official data is unreliable and often manipulated. Professor Tresna P. Soemardi of the Management Faculty of the University of Indonesia says if the standard of less than one dollar per day earnings is used, then 49% of Indonesians live in poverty. Indonesian statistics bureau calculates that “only” 15.42% of the population was living in poverty in 2007, but their data is based on government’s definition of poverty: person earning less than 182,636 rupiah ($19.81) a month.

In the last year alone, food prices have risen by at least 11.4% (according to Jakarta Post). This is in response to the increase in global food prices and skyrocketing fuel and transportation costs in a country where the government has gradually abandoned fuel subsidies.

In a meeting organized by the International NGO Forum on Indonesian Development, Agustinus Prasetyantoko of Atmajaya University alleged that food and energy prices are expected to continue rising in the coming years due to increasing demand and shrinking output. In May 2008, The Jakarta Post reported that speculations in the financial market, including futures trading, have exacerbated the energy and food crisis by inflating prices in spite of a global economic slowdown. “Commodities, Agustinus said, including food and oil, have become the anchors of financial derivatives and more and more commodities contracts are being traded in the futures market.”


But Rachmat Pambudu, the Secretary General of HKTI (Himpunan Kerukunan Tani Indonesia - Indonesian Farmers Association with around 21 million members, remains upbeat. Commenting for the report he wondered: “Food crises? Who said there is a food crisis? That is only a rumor! HKTI is implementing some real programs, advocating for no import policies! So we are against imports because facts show that we can do it ourselves: to plant rice, corn and sugarcane.”

Yet it remains to be seen how successful HKTI will be in blocking the imports – clearly a move desired by most local farmers who see rice imports from Vietnam and elsewhere, as unwelcome competition. However, it is no secret that Indonesia is far from being self-sufficient in production of rice and other crops. Many see the last years of Suharto’s rule as the bubble that burst during the Asian Financial Crises in the late 90’s. In November 1998 Suharto stepped down, but his extreme pro-market economic system accompanied by widespread corruption and cronyism survived his retirement, even his death. Almost no public subsidies to farmers, crumbling infrastructure, land speculations have resulted in a country which won the FAO gold medal in 1984 for achieving self sufficiency in rice, today being dependant on food imports.

Leadership of HKTI, however, can be hardly described as socially oriented. It is notable that the chairman of HKTI – Prabowo Subianto – is a retired army general and former chief of Special Forces, as well as the son-in-law of deceased dictator Suharto. According to reports he is preparing to run for President in elections next year (2009), using HKTI policies as the banner for his campaign. Several Indonesian television stations are now broadcasting advertisements highlighting HKTI policies.

Mr. Wagimin (as many Javanese he has only one name), Vice Chairman of KTNA Solo Branch of Kelompok Tani Nelayan Andalan (Farmers and Fishermen Group) is noticeably less optimistic about the situation:


“We feel the impact of fuel price increases. Our farmers and fishermen also have to shoulder a raise in prices of fertilizers and pest controls. Although in theory the government agreed to subsidize inputs, fertilizers and pesticides remain very expensive and this year the farmers are expected to pay approximately 15% more for them. Our harvest this year is not very good either. Between 25% and 50% of the rice fields in this area can not be properly harvested, mainly because of increasing pest attacks.”

Indonesia: A Victim of Market Fundamentalism

The military coup of 1965 killed 500,000 to 3 million (exact numbers will never be known) members of progressive political parties and movements, trade unionists, members of Chinese minority, teachers, intellectuals and atheists. The coup had been supported by the United States, Australia and other western powers. Suharto sidelined left-leaning President Sukarno who, together with Indira Gandhi and Marshall Tito, was part of the core of the leaders of non-aligned nations.

Nationalism and enthusiasm of Sukarno was rapidly suppressed, business glorified while unions, left wing political parties, and intellectuals and even atheists were destroyed, killed, banned or silenced. A “New Order” was installed. Between 1965 and 1997 Indonesian cities became “more modern”: maquilladoras constructed at the outskirts while countless shopping centers offered a substitute for oppressed culture. Tens of billions of dollars (according to both World Bank and the UN) disappeared in the pockets of corrupt leaders. Jakarta had suddenly more luxury cars and five star hotels than many rich capital cities, but its millions of children were playing in the open sewages, most of the population living without clean drinking water or adequate medical care.


The majority of people were still living in the countryside, in so-called “kampung.” While needed and exploited, kampung was stubbornly conservative and traditional, an embarrassment to the members of new elites who saw progress and new Indonesia reflected in chain restaurants and country clubs. Almost nothing was invested in the people who lived in the small villages and towns all over this enormous archipelago. In the capital, word “kampung” became synonymous with backwardness and underdevelopment. But even “kampung” could not escape free market and globalization.

“The current crisis reveals that agricultural trade "liberalization" leads to hunger and poverty,” argues La Via Campesina, world’s largest small-farmers movement. Via Campesina goes on to say: “Countries have become extremely dependant on global markets. In 1992, Indonesian farmers produced enough soya to supply the domestic market. Soya-based tofu and 'tempeh' are an important part of the daily diet throughout the archipelago. Following the neo-liberal doctrine, the country opened its borders to food imports, allowing cheap U.S. soya to flood the market. This destroyed national production. Today, 60% of the soya consumed in Indonesia is imported. Record prices for U.S. soya last January led to a national crisis when the price of 'tempeh' and tofu (the ‘meat of the poor’) doubled in a few weeks. The same scenario applies to many countries, for example for corn production in Mexico…”

It is not much talked about, but excessive dependence on global markets, followed by the collapse of traditional agricultural structures, as well as almost non-existent social policies, have manufactured widespread hunger in Indonesia today. The poor in Indonesia are periodically experiencing low scale famines. Tens of thousands of children in Central Java, island of Lombok, and in other parts of this sprawling archipelago are clearly suffering from malnutrition. The World Food Program (WFP) claims that around 13 million Indonesians are malnourished.

“Hunger and malnutrition remain the most devastating problems facing the majority of Indonesians, particularly the poor,” argues Dr Atmarita, in a report, Nutrition Problems in Indonesia. “Hunger and malnutrition exist in some form in almost every district in Indonesia. At present, about one half of the population is iron-deficient and one third is at risk of iodine deficiency disorders. Vitamin A deficiency still affects around 10 million children. The prevalence of LBW (low birth weight) infants in Indonesia is in range of 7-14%, even reaching 16% in some districts. The high prevalence of LBW is most often a result of maternal malnutrition affecting 12 to 22% women aged 15-49... In 2003, 27.5 percent of children under five in Indonesia were moderately to severely underweight.”


Increasing food prices and stagnating incomes have lead to a situation where each grain of rice suddenly matters - at least for the majority of the people. In the meanwhile, Jakarta Post and other publications have reported a sharp deterioration in the quality of food served in traditional (relatively cheap) eateries and markets, including reports of some places selling meatballs made of rat meat and fish sprinkled with formaldehyde (chemical used to make corpses look ‘fresh’ before the funeral).

In the capital, Ibu Kuswaiyah, vegetable seller at one of the markets in East Jakarta – Pasar Perumnas Klender – describes her plight. “We don’t know what to do anymore. Almost all prices of vegetables went up; some even increased by 50%, while prices of others simply doubled. Now we also have to pay much more for transportation. Usually, to bring one load of vegetables from Pasar Induk in Kramat Jati (Central Market in Kramat Jati, East Jakarta) we paid Rp. 20,000 (over U.S. $2). Now we are expected to shoulder the bill of Rp. 30,000 – 35,000 (US 3.10 to 3.70) There are days when I have no money to buy new supplies at the Central Market, even if I managed to sell everything the previous day.”

In the face of the international food crisis and fuel cost squeeze that is threatening millions like Ibu Kuswaiyah worldwide, the United States and European Union have been unwilling to stop subsidizing their farmers and agribusinesses, and have continued to pressure the developing world to “open their markets” and obey the rules of free trade agreements. Grassroots International and Via Campesina could not disagree more with that policy direction. In their report “A Response to the Global Food Prices Crisis - Sustainable Family Farming Can Feed the World,” two organizations are offering an alternative approach:

“Due to the expected growth of world population until 2050 and the need to face climate change, the world will have to produce more food in the years to come. Farmers are able to meet that challenge as they have done in the past. Indeed, the world population doubled in the past 50 years but farmers have increased cereal production even faster.

Via Campesina believes that in order to protect livelihoods, jobs, people's health and the environment, food has to remain in the hands of small scale sustainable farmers and cannot be left under the control of large agribusiness companies or supermarket chains. GMOs and industrial agriculture will not provide healthy food and will further deteriorate the environment. For example, the new "Green Revolution" pushed by AGRA in Africa (new seeds, fertilizers and irrigation at large scale) will not solve the food crisis. It will deepen it. On the other hand, recent research shows that small organic farms are at least as productive as conventional farms, some estimates even suggest that global food production could even increase by as much as 50% with organic agriculture.

To avoid a major food crisis, governments and public institutions have to adopt specific policies aimed at protecting the production of the most important energy in the world: food!

Governments have to develop, promote and protect local production in order to be less dependent on world food prices. This implies the right for any country or union to control food imports and the duty to stop any form of food dumping.”

The way forward is imminently clear. Indonesia, like so many other developing countries, was forced to adopt market-based policies in the mid 1960’s. Organized labor, solidarity and support for social justice were all discouraged, sometimes even entirely outlawed by Suharto and his followers. Poor people (majority of the country), even today, are supposed to serve interests of the small but mighty and utterly corrupt elite.

To increase production and improve quality of food, to boost standards of living in the countryside, and to prevent farmers from being at the mercy of international markets, Indonesian farmers have to forge alliances in the region and with the rest of the world. Suharto’s regime took full advantage of geographical isolation of these isles, making sure that disadvantaged sectors of the population were not able to network and exchange ideas and develop strategies with the foreign counterparts.

This has to rapidly change. Problems that the farmers and great majority of the Indonesian people are now facing are found in many other parts of the world: from Guatemala and Peru to sub-Saharan Africa, South Asia and the Philippines. It is time for the struggling farmers and the working poor to learn from each other, exchange ideas, and come together in the struggle against unfair trade and market fundamentalism.

Andre Vltchek, a Senior Fellow at Oakland Institute, is a novelist, journalist, filmmaker, and a playwright. He is the chief editor of Asiana News Agency ( and co-founder of Mainstay Press.

His latest novel "Point of No Return” is about war correspondents covering the so called New World Order. He also produced a 90-minute film on Suharto’s dictatorship: “Terlena – Breaking of the Nation.” Andre lives and works in Southeast Asia and South Pacific and can be reached at [email protected].