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Indonesia leverages agriculture practices to be more competitive in the EU market

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A large country with a successful agricultural sector, Indonesia offers an array of food exports including coffee, various tropical fruits, rices, Tempeh products and spices to name a few.

In addition to the Merdeka Export program initiated by the Ministry of Agriculture, which aims to further boost agricultural exports, negotiations for an EU-Indonesia free trade agreement were launched on July 18th 2016 and it is hoped this would enable the country to further promote its large variety of products in EU countries. EU Today spoke to Prihasto Setyanto, Director General of Horticulture of Indonesia, about the success of the country’s agricultural sector, some of their unique export products, and the country’s future regarding trading with the EU.

Thriving during the Covid-19 pandemic.

According to Indonesia’s Statistic Bureau, agriculture is one of the sectors that continued to grow during the Covid-19 pandemic, and Setyanto offered some insight on why this may be. He highlights the necessity of food throughout the pandemic, the tropical climate and fertile soil of Indonesia, and the size of the country and its labour force. In a country of 273 million, “more than 70% of the people are farmers”, he said, “and many young people, during the Covid-19 pandemic, liked working as agricultural entrepreneurs”. “People are producing so many kinds of agricultural products which are best for export”, he added.

Setyanto explained that “the export of Indonesian agricultural products increased 15.79% in 2019. For the same period between 2020 and 2021 this increase was 46.7%”. These exports come mostly from plantation crops, followed by livestock, horticulture and food crops.

Commenting on the success of the country’s agricultural sector, Setyanto stated, “The Ministry of Agriculture has a policy with 5 points of action for the success of agriculture in Indonesia; the first is to increase the production and capacity improvement, the second is diversification, the third is strengthening reserve and food systems and the fourth is modernisation of agriculture.” He continued, “We are now trying to improve mechanisation in all agricultures in Indonesia and we are also working to increase our exports… this is is the strategy that is being spread throughout the country.”

Merdeka Exports program.

To further boost Indonesia’s agricultural exports, the country’s Ministry of Agriculture initiated the Merdeka Exports program (Merdeka meaning freedom in English). Speaking about the agreement, Setyanto told us, “17th August is Indonesian Independence Day, and on this day the President of Indonesia wanted to give acknowledgment for the farmers, for the people who produce agricultural products, because we have a very good export during this day… exports increase a lot in the seven days leading up to this day.”

Belgium as a preferential market.

Speaking about Belgium as a preferential market of Indonesia, Setyanto explained, “Belgium has a very large community and so many people from different countries, including African and Asian countries…we understand that they like to consume agricultural products from tropical countries. We see this as very good for the economy and Indonesia and we try to promote some of the products from Indonesia to the Belgian community.” Setyanto stated that Indonesian exports to the EU, of both food and horticulture, are increasing, especially during the Covid-19 pandemic.

The importance of coffee.

Indonesia is the 4th largest producer of coffee in the world and makes different types from all over the country, each with its own flavour. In fact coffee production accounts for around 3% of the country’s GDP, Setyanto told us. “We are trying to improve our good agricultural practice and good handling practice in coffee production for the EU standards”, he explained, adding that the Netherlands and Germany are currently the largest consumers of their coffee within the EU, and they hope to increase Belgium’s consumption. Asked to describe the flavour of Indonesian coffee, Setyanto replied “we have so many kinds of coffee, in every district we produce coffee with different tastes.

I myself cannot differentiate but coffee lovers can tell where different tastes come from.” Comparing some of his own tasting experiences, he described some coffee as having tasted like wine, others like strawberry and another like Cacao. “There are so many flavours” he enthused, “It is probably not known enough here in Belgium, that’s why I’ve come here to promote it.”

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