Agriculture in Indonesia

Agriculture is key to the economy of Indonesia, where it accounts for 43% of total employment and directly contributes 15% to the GDP. Despite its importance and role in the national economy, national food production is still insufficient to meet the food security needs of Indonesia’s citizens. This food insecurity is especially acute among the 172 million people who live in rural and semi-rural areas throughout Indonesia; sixty percent of the poorest Indonesians live on small farms and eighty percent of persons in the bottom fifth of income earners reside in rural areas. As a result of low production and a poor regulatory environment, Indonesia is not only a net importer of rice, but also corn (food and feed), soya beans, beef, wheat and wheat products. USAID’s mission is to improve Indonesia’s agriculture sector. Our programs will improve Indonesia’s food security status, alleviate poverty and unemployment in rural areas, and encourage sustainable adaptation to climate change.

Components

USAID’s programs focus on improving the agricultural sector through expanding the adoption of appropriate agricultural biotechnologies; investments in research and development; support for relevant infrastructure improvement and improving public-private linkages in business and education.

Budget

USAID currently spends over USD $6.7M annually for agricultural development projects throughout the archipelago.

USAID Programs and Activities

Agribusiness Market and Support Activity (AMARTA II)

High-value agriculture products have real potential to drive growth, employment and incomes.  However, in Indonesia, the competitiveness of this sector is constrained by low investment, inadequate infrastructure and underdeveloped agribusiness practices. AMARTA II is USAID’s response to these challenges in four Indonesian provinces. The program will develop the value chains of key high-value horticultural products as well as increasing farmer access to credit and supporting pro-farmer, pro-growth changes to the regulatory framework. It a USD $20M project which will be active from 2011 through 2016.

Papua Agricultural Development Alliance (PADA III)

Papua is currently one of Indonesia’s most under-developed provinces. USAID’s PADA III program aims to improve livelihoods and increase agricultural production, including cocoa, coffee and fisheries. Project funding is USD $10M and it will remain active through 2016.

Biotechnology Support

USAID’s Agriculture Biotechnology Support Project aims to develop high-yield/ disease-resistant crops including potatoes, rice and tomatoes in order to strengthen and diversify Indonesia’s agricultural sector.  Project funding is USD $710,000. The project involves partnering with Cornell University and will remain active through 2014.

Program for Bio-Safety Systems

USAID’s Bio-Safety System Program aims to improve food safety and food handling-related processes. Project funding is USD $500,000 and involves partnering with Indonesia’s Ministry of Agriculture. The project will remain active through 2014.

Integrated Pest Management Collaborative

USAID’s Integrated Pest Management Collaborative Research Support Program aims to strengthen Indonesia’s food-to-market sector by developing and transferring integrated pest management technologies for cocoa, vegetable and rice crops. Project funding is USD $500,000 and involves partnering with Clemson University. The project will remain active through 2015.

Indonesia Golden Rice Program

USAID’s Golden Rice Program aims to develop high value, high yielding and disease resistant rice in Indonesia, strengthening and increasing the overall market value of Indonesia’s rice sector. Project funding is USD $200,000.The project involves partnering with International Rice Research Institute and will remain active through 2012

International Vegetable Research & Development Center

USAID’s International Vegetable Research and Development Program aims to develop, introduce, and monitor new vegetable strains to Indonesia, increasing the market value of Indonesia’s agricultural sector. Project funding is USD $1.5M, and it will remain active through 2014.

Cocoa Value Chain, Sulawesi

USAID’s Cocoa Value Chain Program aims to increase female farmer income levels through improved cocoa production and processing. Project funding is USD $1M, and it will remain active through 2014.