Professional Documents
Culture Documents
2013-PBl 0
-+
A summary of EEPSEA Research Report No. 2013-Rl?: 'General Equilibrium Analysis of the Impact of
Climate Change and its Adaptation in Indonesian Agriculture" by Hermanto, Head of Collaboration,
Indonesian Center for Agricultural Socio-Economic and Policy Studies, Indonesian Agency
for Agricultural Research and Development, Ministry of Agriculture, Bogar, Indonesia.
Email: manto_her@yahoo.com.
Simulating climate-induced
impacts on agricultural
production
The economy-wide impacts of
climate-induced changes in
agricultural production in Indonesia
have not been fully studied. In order to
ensure the timely implementation of
various strategic adaptation and policy
responses, an overview of possible
climate-induced impacts on the
macroeconomic variables of the
Economy-wide impacts
of climate change
in Indonesia
According to simulation results,
climate change impacts on the
agricultural sector will decrease
Indonesia's gross domestic product
(GOP) by 2.6%. Aggregate output will
decrease by 2.1% (Figure 1).
Moreover, almost half of the
Indonesian agricultural sub-sectors
15.0
10.0
5.0
0.0
-5.0
-10.0
-15.0
-20.0
51M2
-2.8
-2.7
-21.9
7.9
SIM 1 SIM2
Figure 1. Climate change impacts on the value of some macroeconomic variables in Indonesia
Oil Palm
Paddy
Maize
Beans
Coconut
......
Sug ar Ca ne
Rubber
Tea
Clove
Root Crops
Coffee
Focus should be on
reducing vulnerability
-35
-30
-20
-25
-15
-5
-10
-10
+--------
-20
+--------
-30 +--------
Food
Rice
Flour
Sugar
OtherFood
SIM 1 SIM2
Figure 3. Impacts of climate change on manufacturing production in Indonesia
Agricultural subsidies
exacerbate climate-induced
impacts
When the government implements
fiscal instruments such as 20%
subsidies on the agricultural and
manufacturing sectors, various
economic indicators will experience
further reduction. For example, GOP
will decrease by 3%, which is about
0.4% higher than the scenario
without government subsidies.
CPI will rise by 7.9%, which is about
1.3% higher than the scenario
without subsidies (Figure 1).
There are two reasons why fiscal
instruments, in the form of
MALAYSIA: WorldFish
headquarters, Jalan Batu
Maung, Batu Maung, 11960
Bayan Lepas, Penang
Tel: +60 4 626 1606
Fax: +60 4 620 2263
Email: admin@eepsea.net
For more information about
opportunities available at
EEPSEA and to download
EEPSEA publications for free
visit www.eepsea.net
EEPSEA is adll\l\ivtistev-ed by Wov-ldfisV.. ovt beV..a(f of its spovtsov-s, Sida avtd IDRC.
WorldFish
IDRC
CRDI