Dateline Southeast Asia

Indonesian parties table legislation to outlaw alcohol

By RJ Whitehead

- Last updated on GMT

© iStock
© iStock

Related tags: Southeast asia, Philippines

Plus: Childhood stunting costs Philippines almost 3% of GDP; and Vietnam’s first ‘fairer’ sugar auctions announced.

The United Development Party (PPP) and the Prosperous Justice Party (PKS) said they had not tabled the bill for religious or ideological reasons. “This is purely for the protection of the children of the nation​,” Abdul Hakim of the PKS told Reuters.

If the bill were to pass, Indonesia would become only the second nation in Southeast Asia to exercise probation after Brunei. It is currently Asia’s tenth-biggest alcohol consumer, having seen a 54% increase in liquor sales in the past decade. 

The proposal is now being considered by parliament amid raging debate inside and outside Jakarta’s corridors of power.

The tourism industry has warned that prohibition would destroy a segment that sees 10m tourists annually.

If the bill is passed, our business will be done​,” said Hariyadi Sukamdani, head of the Indonesian Hotel and Restaurant Association, told the Jakarta Post​.

"No matter how beautiful the country is, if [foreign tourists] can't find alcohol, they won't want to come here​.”

Charles Poluan, executive director of the Indonesia Malt Beverage Producers Association, told the Jakarta Post​ that a ban will destroy the industry and force manufacturers and their supply chains to shut down. This would directly affect up to 2,000 workers and indirectly 200,000 in the sales sector alone, he said.

Indonesia’s biggest brewer, Bintang, has reportedly put expansion plans on hold because of uncertainty created by the bill. Beer accounts for more than 90% of alcohol sold in the country.

The alcoholic beverages market is worth some US$435m, and contributes an even higher figure to Indonesia’s treasury each year in taxes.

Pundits believe that the ban is unlikely to be passed, though its debate could prompt more hardline provinces to approve local prohibition. Like Malaysia, Indonesia has been seeing an increase in support for more islamist policies, though it is officially a secular country.

More stories from Southeast Asia…

Childhood stunting costs Philippines almost 3% of GDP

A report by a global children’s charity has revealed that the Philippines economy is losing at least PHP328bn (US$7bn) a year due to the impact of childhood stunting on workforce productivity and education. 

Malnutriton

The study, by Save the Children, suggests that childhood stunting cost the Philippines almost 3% of its GDP in 2013. 

Of this figure, PHP166.5bn (US$3.6bn) represented lost income from lower education levels by workers who had suffered from childhood stunting, while a similar figure represented lost productivity due to premature deaths. A further PHP1.2bn came from additional education costs to cover grade repetitions linked to undernutrition.   

Ned Olney, the charity’s country director, said the study proved that undernutrition bore a cost to the entire population. 

In just a year, the Philippines has lost almost 3% of its GDP in terms of education and productivity costs due to stunting. If we add up health costs, the likely impact would be an additional 0.05-1.6%​,” he said.   

The report shows that undernutrition is linked to lower human capital. Children who are stunted in the first two years of life are more likely to repeat grade levels, drop out of school, delay school entry and have lower income levels when they enter the workforce.   

If stunting rates continue to rise, it would be difficult for families to break free from poverty. Any investment in reducing childhood undernutrition will reduce suffering and poverty, and will ultimately stimulate economic growth for all Filipinos​,” said Olney.   

Yet government investment in nutrition programmes is still very low, at only 0.52% of overall health expenditure, compared to the global average of 2.1%, the study found. 

Nutrition is the cornerstone of all development efforts. This new report tells us that for every US$1 spent on programs to avert stunting in children below two years old, the Philippines could save over US$100 in health, education, and lost productivity costs​,” Olney added.   

Vietnam’s first ‘fairer’ sugar auctions announced

Vietnam’s trade ministry is preparing to auction import quotas for 85,000 tons of sugar this year in a move that will delight industry lobbyists.

Sugar

The ministry has been accepting applications for the auction following years of pressure from the Vietnam Sugar and Sugarcane Association, which criticised the current system for being unfair. The sale will take place on September 7.

Until now, food and beverage companies were entitled to their quotas through a licensing system that did not involve bidding. Companies would compete fiercely for these licenses as imported sugar costs less than domestic products.

Under the new system, sugar companies will be allowed to bid for import rights for up to 40,000 tons of raw sugar. Manufacturers of confectionary and soft drinks will be able to bid for up to 45,000 tons of refined sugar separately.

The government will bank the difference between the bid amounts and prices.

Drought earlier this year, which damaged around 7% of Vietnam’s sugarcane crop, has resulted in a 12,7% drop in output to 1.24m tons.

Sugar prices have grown strongly in Vietnam over recent months to VND7,000-7,500 (US$0.31-0.34) per kilogram.

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