Analysis of Garlic Commodity Competitiveness and Impact of Government Policy in Indonesia

Abstract

Indonesia's government is currently developing garlic commodities in several areas of highland dry land production centres to reduce dependence on imports (94%) from domestic needs. This paper aims to: (1) analyse the benefits of garlic farming financially (private) and economically (social); (2) analyse the competitiveness of garlic farming, both from the perspective of competitive advantage and comparative advantage; (3) review the impact of government policy on garlic farming system; and (4) formulate incentive policies in garlic development. The analysis method was conducted using the Policy Analysis Matrix (PAM) to see Indonesian garlic's competitive position globally. The study area includes Cianjur Regency, West Java; Karang Anyar, Central Java; Pasuruan, East Java; and East Lombok, West Nusa Tenggara. The analysis results showed that garlic farming is financially profitable, but economically less profitable or not profitable. Garlic farming has a competitive advantage but less or no comparative advantage. The value of DRCR >1 shows that Indonesia does not have a comparative advantage in producing garlic. The policy implication is that if Indonesia continues to reduce dependence on imported garlic, it will require breakthroughs in advanced innovation, integrated regional development, agricultural infrastructure support, institutional strengthening of farmers, and farmers' incentive policies.