World Bank Concerns about Rice Prices in Indonesia

The World Bank released the December 2022 Indonesia Economic Prospect (IEP) report, which states that the retail price of rice in Indonesia is higher than in other Southeast Asian countries. The global lender said Indonesia's rice is 28 percent more expensive than that of the Philippines and twice as expensive as Vietnam, Cambodia, and Myanmar.

According to the World Bank, the high price of rice is one of the drivers of rising inflation due to food prices. The cause of high rice prices in Indonesia is market price support for agricultural producers, such as trade restrictions through import tariffs, quantitative restrictions, and monopolization of key commodities imports by state-owned enterprises (SOEs). "Long supply chains and high distribution costs, partly due to the country's complex geography, also drive up food prices for consumers," the World Bank report wrote, as quoted on Tuesday.