ANALISIS PERMINTAAN IMPOR GARAM INDONESIA DENGAN PENDEKATAN ALMOST IDEAL DEMAND SYSTEM

Abstract

Salt is a strategic commodity whichis needed by human life. Salt demand will always increase along with the increasing members of population. Due to productiondeficit Indonesia has been importing salt with increasing trend. The Indonesian import is mainly coming from Australia, India and New Zealand. This research was undertaken to analyze the degree of vulnerability of import demand with regard of changing price in thoses exporting countries and to analyze the import demand elasticity. The import demand equation was estimated using an Almost Ideal Demand System (AIDS) by applying Seemingly Unrelated Regression (SUR) method. The result of this showed that only India which had an elastic expenditure elasticity. On the other hand, compensated and uncompensated elasticity indicate that Australian and Indian salt had a complementary relation while New Zealand had a substitution relation to both of them. The findings suggest that the government should apply support for both of sides, through domestic as well trade policies.For the domestic sectorthree policy options have been suggested:data synchronization with regard of salt production, supporting the development of salt industries through improvement of marketing system, and applyingnew affordable technology. In term of trade policy, the Indonesia goverment is suggested to revise the treaty, especially with Austalia and New Zealand and applying import tariff.