Impact of Government Policy on the Improvement of Maize Competitiveness

Indonesia has a tropical climate and fertile soil that is suitable for maize growth. However, the average of maize productivity in each district is only about 3.5 to 5 tons per hectare. The problem of low productivity of maize is suspected to be closely related to the problem of efficiency in using inputs. High competitiveness is reflected by good price and quality. But this will cause problems if the commodity produced are not able to compete. Comparative and competitive advantages of a commodity depend on key factors such as market performance. In addition, government intervention in the form of policy will influence the comparative and competitive advantage of a commodity system. Data and information on comparative and competitive advantages is one of the considerations in formulating policies and their implementation. This study aims to (1). Analyze the profitability level of maize farming financially and economically, (2). Analyze the competitiveness (competitive and comparative advantage) of maize farming, (3). Analyze the impact of government policy on inputs and outputs in maize farming development, (4). Analyze the sensitivity level of maize commodity competitiveness as the impact of change of input and output price variable. This research was conducted at Center of Maize Development. This research uses Policy Analysis Matrix (PAM) as analysis tool. The data used in this study are primary data and secondary data, both quantitative and qualitative. The method used to collect data is by interviewing farmers as respondents by using structured questionnaires. The results showed that maize farming in South Sulawesi was profitable and feasible in both financial and economic analysis, also have both competitive and comparative advantages. Competitiveness is very sensitive to changes in tradable input prices. Government policy on the price of tradable inputs (subsidized seed and fertilizer) has a positive impact on the competitiveness of maize commodity, while government policy on output prices does not exist. Output price is formed due to market mechanism, not due to government intervention.