Pressing Inflation, Trade Minister Zulhas Asks Local Government For Food Transport Subsidies

Minister of Trade Zulkifli Hasan. (Photo: Doc. Antara)

JAKARTA - Minister of Trade (Mendag) Zulkifli Hasan asked the local government (Pemda) to optimize subsidies for food transportation. This is because the transportation and logistics sectors are the biggest components that affect the high food prices.

Zulhas as Zulkifli Hasan is familiarly known, said subsidies for food transportation costs were seen as necessary as a solution to suppress inflation.

"Requested regional heads pay attention to this. Because the most expensive, the highest increase is transportation, so regional heads can subsidize transportation," he said at the Ministry of Trade Building, Jakarta, Wednesday 10 August.

Zulhas said, regional heads can use their respective regional revenue and expenditure budgets (APBD) as a budget source to provide subsidies for this food transportation.

However, regarding the mechanism, the General Chairperson of PAN submits it to each regional head to formulate it.

“(The funds are) there is a APBD. There are funds like our reserves, yes," he explained.

Previously, the Central Statistics Agency (BPS) reported that the inflation rate in Indonesia in July 2022 was 4.94 percent year on year (yoy). This inflation achievement was the highest since October 2015 with a record 6.25 percent.

Head of BPS Margo Yuwono said that inflation was mostly contributed by the volatile price component of 0.25 percent which came from red chili, shallots and cayenne pepper commodities.

"Then the second comes from the price component that is regulated by the government at 0.21 percent of air transportation rates, household fuel, cigarettes, and electricity tariffs," he said through an online channel when giving a presentation to reporters, Monday, August 1.

Margo added that core component inflation contributed 0.18 percent with fresh fish commodities, cars and house rentals.

"Until July 2022, core inflation is still relatively stable, covering around 700 commodities," he said.

Of the 90 cities, the highest inflation was in Kendari with 2.27 percent. While the lowest was in Pematang Siantar and Tanjung with 0.04 percent.

VOI noted that inflation in July 2022 with 4.94 percent was the highest so far this year. The upward trend has occurred since February which was at the level of 2.03 percent.

Just so you know, the government through the Ministry of Finance (Kemenkeu) together with Bank Indonesia initially estimated that inflation could be maintained in the range of 3 percent plus minus 1 percent for the 2022 period. However, the latest developments made the government then make an upward projection this year with an estimate that it would touch 4.5 percent.