Indonesia is to shift 25 trillion rupiah (some 2.7 billion U.S. dollars) funds from the energy sector to the food sector this year to stabilize the soaring food prices, the country's Energy Minister Purnomo Yusgiantoro said Tuesday.
Minister Purnomo said the government also planned to add 35 trillion rupiah (some 37.92 billion U.S. dollars) to the subsidies at the food sector, in condition that the parliament give an approval on the government proposal to change the assumption of oil price at the state budget from 60 U.S. dollars per barrel to 80 U.S. dollars per barrel at the middle of this month.
Should the parliament give approval, the total funds to be allocated for the subsidy to the food sector will be 6 billion U.S. dollars.
Minister Purnomo said the 2.7 billion U.S. dollars funds would be obtained from the retrenchment at the oil sector, electricity, and the additional income from the sector of mining and oil and gas.
"The funds will be got from the cut of 10 trillion rupiah at the oil subsidies, 10 trillion rupiah at electricity sector, and 5trillion rupiah from mining and, oil and gas," he told a joint press conference after meeting with Indonesian Vice President Jusuf Kalla at his office here.
On the same occasion, Downstream Oil and Gas Regulator chairman Tubagus Haryono said that the 10.83 billion U.S. dollars funds would be obtained from the decreasing of subsidies at kerosene, solar and others.
President Director of the state-owned oil and gas company of Pertamina Ari Soemarno said the company would accelerate the conversion of the use of kerosene to gas to collect the funds at the oil sector.
Director of the state-owned electricity company PLN inc. Eddie Widiono said that at electricity sector the company would continue the program of efficiency at the consumption of electricity.
He said the company would decrease the use of oil to generate its generators.
The company will consume 9.5 million kiloliter of oil in 2008, he said.
"The electricity efficiency is difficult for us," said Widiono.
The weakening of the U.S. economy has decreased exports from the biggest Southeast Asia economy. The increase of global commodities and soaring oil price have also affected on the increase of food price in Indonesia, adding pressure on inflation.
Soaring food prices could damage the popularity of the government in Indonesia.
Source: Xinhua
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