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Institutional determinants of Indonesia's sugar trade policy

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  • Tim Stapleton

Abstract

An analysis of contemporary sugar trade policy in Indonesia highlights problems in the institutional framework for trade policy making. The institutions through which sugar trade policy is formulated entrench the interests of rent-seeking bureaucrats, import licence holders and traders to the detriment of consumers and downstream producers of processed products. Moreover, the resulting trade policy regime has problematic effects on sugarcane farmers. The structure of regulatory intervention is due less to democratic pressures than to the inclusion of vested interests in the institutions that formulate policy. Further, the lack of effective mechanisms for inter-ministerial coordination and for resolving conflicting policy preferences among ministries hinders the development of coherent trade policy and obstructs reform efforts. An institutional framework that facilitates representation of all interests affected by sugar trade policies and public scrutiny of the effects of policy intervention is likely to deliver better outcomes for consumers and producers alike.

Suggested Citation

  • Tim Stapleton, 2006. "Institutional determinants of Indonesia's sugar trade policy," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 42(1), pages 95-103.
  • Handle: RePEc:taf:bindes:v:42:y:2006:i:1:p:95-103
    DOI: 10.1080/00074910600632401
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    Cited by:

    1. Prema-Chandra Athukorala, 2006. "Post-crisis export performance: The Indonesian experience in regional perspective," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 42(2), pages 177-211.
    2. Kelly Bird & Hal Hill & Sandy Cuthbertson, 2008. "Making Trade Policy in a New Democracy after a Deep Crisis: Indonesia," The World Economy, Wiley Blackwell, vol. 31(7), pages 947-968, July.

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