The Analysis of Trade Liberalization and Nutrition Intake for Improving Food Security across Districts in Indonesia

Abstract

The debate on the effect of trade liberalization on food security poses solid arguments, both in favor as well as against the issue. This study aims to analyze the linkages between trade liberalization (measured using food import tariff exposure) and food security (measured using nutrition intake) in the case of Indonesia. The national food import tariff is decomposed into district-level import tariff exposure and is analyzed based on sectoral tariffs such as agriculture tariffs and food manufacture import tariffs. The analysis employs panel data of 496 Indonesian districts and postulates an association between trade and food security by using fixed-effect regression. By analyzing the effects of tariff exposure towards food consumption in all districts and grouping the districts into 5 (five) islands, we can contribute to the literature on trade liberalization and food security. First, it is found that import tariff exposure is negatively impacting nutrition intake and each sector has a different effect on each nutrition intake. Furthermore, the impact of manufacturing tariffs on calorie and protein intake is slightly higher than that of agriculture tariffs. Second, it is shown that both sectoral import tariffs’ effects vary across islands in Indonesia. Furthermore, the research is expected to contribute to and become a reference for the government in regulating tariffs and other trade liberalization schemes to support households to be food secure.

The effects of trade liberalization on inequality in nutrition intake: empirical evidence from Indian districts

“…Ceteris paribus, as the food import tariffs decrease by 1%, on average, the inequality of calorie intake increased by 0.45, the inequality of zinc intake by 0.56, the inequality of vitamin B 1 intake by 0.48, and the inequality of vitamin B 2 by 0.66. Existing research suggested that increased food trade openness would logically increase the number of calories and nutrients available [ 9 , 36 ]. However, our findings imply that those who need it most (living mostly in rural areas) may not benefit from increased food trade and that inequalities in nutrition consumption do not improve as a result.…”

“…The results suggested that reductions in tariffs due to trade liberalization would exacerbate inequality in the consumption of calories, zinc, vitamin B 1, and vitamin B 2 (Table 2 ). Food trade liberalization is often considered as a core element aiming to improve national malnutrition [ 36 ]. However, most developing countries are not competitive enough to take advantage of the positive impact of trade liberalization on nutrition consumption, which is closely linked to income distribution, the performance of national food markets, etc.…”

Globalization and food security in Sub-Saharan Africa

“…This resonates with the broader study on the impact of globalization on food security in Sub-Saharan Africa, emphasizing the interconnectedness of economic factors and agricultural outcomes. Montolalu et al (2022) analysis of trade liberalization and dietary consumption in diverse Indonesian districts reveals a negative relationship between import tariff exposure and nutritional intake, varying across economic sectors and geographic regions within Indonesia. The study underscores the importance of considering regional specifics, economic conditions, and employment factors when implementing trade policies.…”

“…Succinctly put, food security has been a major concern for scholars around the world and many research works published testify to this, few of them being Khan et al (2014) and Ayanlade and Radeny (2020). There have been very few recent empirical studies that have focused on the nexus between globalization and food security (Mary, 2019;Fusco et al, 2020;Montolalu et al, 2022). Consequently, the gap in food security literature is the unavailability of adequate empirical literature which focuses on uncovering the effect of globalization on food security in Sub-Saharan Africa.…”

Mapping the Provincial Food Security Conditions in Indonesia Using Cluster Ensemble-Based Mixed Data Clustering-Robust Clustering with Links (CEBMDC-ROCK)

“…The issue of food is indeed an issue that continues to be discussed by the government, both about imports, selfsufficiency, and food security [9]. Especially Indonesia, as an agricultural country with fertile soil and abundant resources, is still struggling with food supply problems [10]. Indonesia itself ranks 5th on food security scores from 10 countries in ASEAN.…”