Category: Economics

Jakarta – Kratom has become the latest herb that gained huge interest in the United States. As one of major Kratom’s producers, Indonesia has been considering regulating and reclassifying the plant, making kratom legal for cultivation and export. 

Seeing kratom’s huge potential and benefits, the Executive Office of the President (KSP) has responded positively to the partnership offers made by American-Indonesian Chamber of Commerce, the American Kratom Association (AKA) and the Anugerah Bumi Hijau Producers Cooperative (KOPRABUH) to ensure the health standard and the safety of kratom exports.

Kratom is a tropical plant that is commonly found in Malaysia, Thailand and Indonesia. Touted as a herbal plant that eases pain and anxiety, the traditional medicine is largely found in West Kalimantan forest. Indonesia is believed to be the source of more than 90 per cent of the world’s supply of kratom.

“Both sides agree that kratom can boost the economic growth of both countries. Therefore, we agreed that kratom should be made as a regulated export commodity. In fact, the Trade Ministry Regulation No. 18/2021 does not mention kratom as a prohibited good for export,” said Presidential Chief of Staff Dr. Moeldoko in a meeting with the United States counterparts, at the Bina Graha Building, Jakarta, Monday (8/8).

Meanwhile, the indigenous people of West Kalimantan have started cultivating Kratom plants that grow well in swamp areas since 2010. It counts 11,384 hectares for Kratom cultivation, spreading across 23 sub-districts and 282 villages in West Kalimantan province. As many as 200,000 households in West Kalimantan Province are very dependent on the kratom industry. It was recorded that until July 2021, the number of kratom exports from Indonesia to the United States alone had reached 400 tons.

Even so, Moeldoko noted that Indonesian kratom has a contentious history as the National Narcotics Agency (BNN) classifies kratom as an addictive substance.

“There needs to be joint research between US and Indonesian educational institutions. It is apparent that Johns Hopkins University of the US has been doing research on kratom for a long time. On the other side, Indonesia has the goods. So we hope the research collaboration will bring something to the table of the academia world,” added Moeldoko.

Attending the meeting was Senator Curt Bramble of the state of Utah who said that Kratom has become an important commodity in the United States as a substitute for the highly addictive opium in reducing pain and anxiety disorders.

“Kratom is a safe natural product, but the challenge is that kratom is often contaminated by E. Coli bacteria, Salmonella and heavy metals. I hope for this meeting, we will find a way for states in the US to work with the Indonesian government in finding mutual understanding on the policies, if necessary, to maintain safe supply of kratom from Indonesia to the individuals in the US,” said Curt Bramble.

Salatiga – Citing the latest Bloomberg survey, Presidential Chief of Staff Moeldoko said an optimistic outlook for Indonesia’s economy amid global uncertainty. The survey listed Indonesia as the second last country out of 15 countries with recession risk, having a chance of 3% to go into recession. 

Following India with 0 percent risk of recession, Indonesia is having a very small chance to be impacted by the global economic fallout due to prolonged COVID-19 pandemic and raging geopolitics situation. 

“The survey’s result shows that our domestic economy is resilient despite the escalating global uncertainty,” said Moeldoko during a national seminar held by Satya Wacana Christian University, in Salatiga, Central Java, Monday (18/7).

The good result, according to Moeldoko, can’t be separated from the government’s agility and quick response towards the global economic crisis threat. In the energy sector, for example, the government continues to expand fuel subsidies up to Rp 520 trillion. 

“However, rolling out subsidies with no end to it will potentially disrupt the state budget. For that, the subsidy scheme shall be changed. It will no longer subsidize goods, but it will aim at the people who need it the most,” he explained.

The former TNI Commander said the government had also shifted its focus to the threat of a food crisis, as proven by the increased productivity in the agricultural sector to meet domestic food consumption needs, which amounted to 2.5 million tons per month.

“We are no longer importing rice for three years in a row now. Even better, our rice production is in surplus. The government is also diversifying food. We are now starting to massively develop sorghum, sago, and corn to answer the food crisis challenges,” continued Moeldoko.

Nevertheless, managing a country amid the global uncertainty is not easy, indeed, said Moeldoko. In addition to the prolonged COVID-19 pandemic, the world is shaken by Russia’s invasion of Ukraine. Not only that the geopolitical tension brings disruption to the food supply chains, it also leads to the skyrocketing prices of various commodities.  

Now to that, Moeldoko said that a nation should be able to adapt to change, to speed up developments in all fronts, to take risks through constitutionally adopted policies, to be ready to face the global complexities, and to respond faster towards any surprises that will occur due to technological advances.