Palm Oil DMO And DPO Policies Are Implemented Again, Economists: Implementation Must Be Monitored

Illustration. (Photo: Doc. Antara)

JAKARTA - Director of the Center of Economic and Law Studies (Celios) Bhima Yudhistira asked the government to strictly monitor the implementation of the domestic market obligation (DMO) and domestic price obligation (DPO) for crude palm oil (CPO) so that there is no leakage at the national level. producer.

As is known, the government plans to stop the bulk cooking oil subsidy program as of May 31, 2022. The government will also replace the policy with domestic market obligation (DMO) and domestic price obligation (DPO) for crude palm oil (CPO). The aim is to maintain supply so that the price of bulk cooking oil in the market is stable at the highest retail price (HET).

"DMO supervision should not repeat the leakage of export permits within the Ministry of Trade. An important lesson is how the officials who issue export permits have integrity, and avoid conflicts of interest with business actors. This means that internal control is crucial," he said when contacted by VOI, Wednesday, 25 May.

According to Bhima, the implementation of the DMO also requires cooperation between the Ministry of Trade and Customs and Excise. So that the export volume of cooking oil per company can be verified.

"It is even possible that the volume of cooking oil with the same HS Code can be checked with data in the final export destination country," he explained.

Bhima also said that the DMO policy should encourage an increase in the supply of CPO for cooking oil raw materials. But the problem so far is not from the supply side, but from the distribution side. According to him, as long as the distribution chain is still 5 to 7 points long to reach consumers, it will be difficult for the migration price to drop significantly.

But unfortunately, said Bhima, distribution issues are not under the control of the Ministry of Trade (Kemendag), but the Ministry of Industry (Kemenperin). Therefore, according to him, Bulog should be given the task of handling the distribution of cooking oil.

"There are still many overlapping institutions/ministries in the matter of cooking oil. Ideally, Bulog will handle the distribution of domestic migrants, so that subsidies and supervision are much more transparent," he said.