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    Monitoring Food Prices, West Java Develops EWS


    BANDUNG-Price stability is very closely related to macroeconomic stability and inflation target. The lack of reliable food price information will affect the efficiency of decisions taken by economic actors. The accumulation of negative public expectations due to 'asymmetry information' has the potential to cause price volatility which in turn is feared to affect macroeconomic stability.

    West Java Governor Ahmad Heryawan (Aher) said that related to the need for food price transparency in order to happen 'convergence' price that will reduce the potential economic turmoil in the region. Thus, the stability of food prices can lead to improving the welfare of the people of West Java in general.

    Accordingly, the Inflation Control Coordination Forum (FKPI) and the Regional Inflation Control Team (TPID) of West Java have developed PRIANGAN as one of the tools to control inflation in West Java and as part of PROPER KAHIJI UTAMA  Volume II program.

    West Java Governor Ahmad Heryawan said that the system, provides important benefits, especially in monitoring the stability of the price of basic commodities in the market.

    "If there is a price gap, we can take immediate action," said Governor Aher at Kick-Off Early Warning System (EWS) Food Price Information (Portal Informasi Harga Pangan/ Priangan), in West Hall of Gedung Sate Bandung, Wednesday (14/06/2017) .

    Aher also hopes, the government can continue to bring food controlled in terms of price and stock. Through the Food Price Information Portal (PRIANGAN) enriched with Early Warning System (EWS) feature, it is expected to minimize / eliminate the 'asymmetric information' constraint so that in the end it can create price stability that affect economic improvement especially in West Java.

    "With electronic systems like today, the mafia game began to be minimized," he continued.

    In connection with that, Aher appealed to all stakeholders related to the effort to maintain food stability, to always increase cooperation among regions as a solution in overcoming the problem of limited food stocks both internal West Java and interprovincial.

    Later, Aher also asked related parties to be active in monitoring daily food prices.

    "Active in the development of e-Priangan operations in each region as virtual market operations are not incidental," he said.

    Then, he said, preparing the food balance regularly as the basis of initiation of cooperation between regions, empowering the community in the activities of independent farming through Kampung Peduli Inflasi / Kawasan Rumah Pangan Lestari (KRPL) program.

    Also important, improving coordination among agencies in each regency / city as well as coordination between regencies / cities in order to anticipate the problem of controlling inflation both that will happen or what is happening.

    "And Market Operations as a first step in overcoming the price spike," he said.

    Head of Bank Indonesia West Java Province Representative, Wiwiek Sisto Widayat said that the development of EWS PRIANGAN feature is also one of 'tools', or tools to support the government for policy making in maintaining price stability, minimizing price disparity, and ensuring the availability of basic commodities.

    In addition, the additional features of PRIANGAN are also expected to shape positive perceptions of the community and can suppress public expectations of commodity price fluctuations.

    "The initial milestone of the EWS feature comes from the Ministry of Commerce initiating a strategic food commodity price monitoring tool called the Market Monitoring System for Basic Needs or SP2KP," he said.

    "In 2017, PRIANGAN development is aimed at optimizing Early Earning System (EWS) features to be integrated, both on PRIANGAN website and in PRIANGAN mobile phone applications," he said.

    As a first step, Wiwiek discloses, EWS will monitor the price movements of 10 strategic food commodities (Rice, Red Onion, Garlic, Red Chili, Chilli, Rough Chicken, Rough Chicken Egg, Beef, Sugar, and Cooking Oil) based on Daily price data in 7 Cities Sample CPI in West Java (Bandung, Bogor, Depok, Bekasi, Sukabumi, Tasikmalaya, and Cirebon).

    The data that is used in the EWS system is the average daily price of strategic food commodities in the market surveyed in each city. The threshold indicator consists of 4 (four categories), namely:

    - If the price rises above 5% or is in the Normal category, then the price movement is considered normal but there is a tendency of price increase.

    - If the price rises above 8% or is in the alert category, then the Regional Leaders are expected to be wary of continued price increases. 
    - If the price rises above 12% or is in the alert category, then the Regional Leaders are expected to be alert to the price increase and respond with virtual meeting in PRIANGAN application and take countermeasures. 

    "If price increase reaches critical point level (above 20% ), Then all Regional Leaders, led by the Governor, are expected to coordinate the implementation of concrete action to cope with price increases, "he explained.

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