Reimbursement to the Century Bank bailout cost the state assessed as 6.7 trillion or 6700 billion. Formation of Special Committee Questionnaires Rights Century which has been calling witnesses and parties deemed responsible for any has been done. Various elements of society, so spirits guarding the case of Century Bank until demonstrations happen everywhere.
Century Bank is now drowning case by case with the suspect Gayus tax broker, Director General of Taxation Ministry of Finance officials RI. If compared to the value, Century Bank case is much greater 268 times than the value of the findings in the case of Gayus. However, mass media or TV rarely preach the extent to which follow up the case of Century Bank.
Once again, a case that cost the state came from the department or institution that deals with finance: the Ministry of Finance. The high salaries and allowances of employees of these institution have not been able to reduce the intention to avoid bribery, a broker case, and other things that smell KKN.
Rabu, 21 April 2010
Selasa, 20 April 2010
Tommy still owes government Rp 2.3t, says Finance Ministry
Car company PT Timor Putra Nasional owned by Hutomo "Tommy" Mandala Putra, son of late former president Soeharto, should pay debts up to Rp 2.37 trillion (US$263.07 million) to the state, the Finance Ministry said.
The amount is exclusive of a 10 percent administration fee, meaning Timor should pay Rp 2.61 trillion in total, the ministry said in a statement on Monday.
This is another government's attempt to recover state debts from Timor, established in 1995 and granted "national car producer" status when Soeharto was in power, in a legal case that began more than a decade ago.
According to the ministry, Timor was given a credit facility at Bank Bumi Daya (now merged with Bank Mandiri) using the firm's current account and deposit account as collateral.
On March 31, 1999, the credit was taken over by the now-defunct Indonesian Bank Restructuring Agency (IBRA) after Timor defaulted on its debts.
On April 30, 2003, the IBRA sold Timor's assets to PT Vista Bella Pratama, excluding the current account and deposit account, which were seized by the tax office.
On Aug. 8, 2008, the sale of Timor was cancelled by Finance Minister Sri Mulyani Indrawati, who took over the responsibility of IBRA, after the Corruption Eradication Commission found out that Vista was affiliated with Timor and Tommy and did not represent an independent buyer.
The cancellation of the sale was confirmed by an agreement signed between the Finance Ministry and Vista, and a ruling made by the Central Jakarta District Court on Nov. 27, 2008.
Therefore, all debts belonging to Timor automatically became state debts, including the current account and deposit account that have never been sold to Vista, the ministry said.
On Nov. 26, 2008, Mulyani asked Bank Mandiri to disburse and transfer the funds in the current account and deposit account to the state treasury's account to be set off against existing Timor's debts. This leaves Timor owing a remaining Rp 2.37 trillion in state debts.
The amount is exclusive of a 10 percent administration fee, meaning Timor should pay Rp 2.61 trillion in total, the ministry said in a statement on Monday.
This is another government's attempt to recover state debts from Timor, established in 1995 and granted "national car producer" status when Soeharto was in power, in a legal case that began more than a decade ago.
According to the ministry, Timor was given a credit facility at Bank Bumi Daya (now merged with Bank Mandiri) using the firm's current account and deposit account as collateral.
On March 31, 1999, the credit was taken over by the now-defunct Indonesian Bank Restructuring Agency (IBRA) after Timor defaulted on its debts.
On April 30, 2003, the IBRA sold Timor's assets to PT Vista Bella Pratama, excluding the current account and deposit account, which were seized by the tax office.
On Aug. 8, 2008, the sale of Timor was cancelled by Finance Minister Sri Mulyani Indrawati, who took over the responsibility of IBRA, after the Corruption Eradication Commission found out that Vista was affiliated with Timor and Tommy and did not represent an independent buyer.
The cancellation of the sale was confirmed by an agreement signed between the Finance Ministry and Vista, and a ruling made by the Central Jakarta District Court on Nov. 27, 2008.
Therefore, all debts belonging to Timor automatically became state debts, including the current account and deposit account that have never been sold to Vista, the ministry said.
On Nov. 26, 2008, Mulyani asked Bank Mandiri to disburse and transfer the funds in the current account and deposit account to the state treasury's account to be set off against existing Timor's debts. This leaves Timor owing a remaining Rp 2.37 trillion in state debts.
Bibit: I respect due process of law
Corruption Eradication Commission (KPK) leader Bibit Samad Rianto said Tuesday he respected the South Jakarta District Court’s order for him and fellow deputy chairman Chandra M Hamzah to face trial for alleged power abuse and bribery.
The court ruled in favor of bribery suspect Anggodo Widjojo, who had filed a pre-trial request against suspension of a criminal investigation into Bibit and Chandra.
Bibit said that the Criminal Procedure Code allowed individuals to file pre-trial requests verdict.
“However, as the media know, I have never committed the acts as charged. On Nov. 3 last year at the Constitutional Court we all heard that we were framed,” Bibit was quoted by kompas.com.
He said he appreciated the prosecutors who appealed the court’s verdict.
The court ruled in favor of bribery suspect Anggodo Widjojo, who had filed a pre-trial request against suspension of a criminal investigation into Bibit and Chandra.
Bibit said that the Criminal Procedure Code allowed individuals to file pre-trial requests verdict.
“However, as the media know, I have never committed the acts as charged. On Nov. 3 last year at the Constitutional Court we all heard that we were framed,” Bibit was quoted by kompas.com.
He said he appreciated the prosecutors who appealed the court’s verdict.
House against cigarette production cut
The House of Representatives’ Commission XI on finance has opposed the government’s plan to lower cigarette production to 248.4 billion sticks from 261 billion this year.
Golkar Party lawmaker Nusron Wahid said on the sidelines of a budget revision hearing on Tuesday the production cut would cause the state to lose Rp 10 trillion in potential revenue.
“The production should stand at 261 billion as originally planned,” Nusron said.
He suggested that the government stop drafting a regulation on control of tobacco impacts, which would require the government to lower national cigarette production.
Nusron also suggested that the government lower excise tax imposed on clove cigarette products but increase that imposed on unflavored cigarette products. “Consumers of unflavored cigarette usually have a higher income than clove cigarette consumers,” he said
The government has proposed an increase in tax excise for all cigarette products in a bid to boost revenue to Rp 57 trillion (US$6.27 billion) in 2010, up from Rp 54 trillion in 2009.
Golkar Party lawmaker Nusron Wahid said on the sidelines of a budget revision hearing on Tuesday the production cut would cause the state to lose Rp 10 trillion in potential revenue.
“The production should stand at 261 billion as originally planned,” Nusron said.
He suggested that the government stop drafting a regulation on control of tobacco impacts, which would require the government to lower national cigarette production.
Nusron also suggested that the government lower excise tax imposed on clove cigarette products but increase that imposed on unflavored cigarette products. “Consumers of unflavored cigarette usually have a higher income than clove cigarette consumers,” he said
The government has proposed an increase in tax excise for all cigarette products in a bid to boost revenue to Rp 57 trillion (US$6.27 billion) in 2010, up from Rp 54 trillion in 2009.
Senin, 12 April 2010
Indonesia's $100 billion budget: Is debt an issue?
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I have received many encouraging responses to my first blog. Thank you. This time, let's look at Indonesia's budget. Last year, Indonesia's budget reached the magical threshold of US$100 billion. With total expenditures of Rupiah 985 trillion and an average exchange rate of 9,750 Rupiah per US dollar, Indonesia's government spent exactly US$101 billion. In 2009, the budget may not increase and will likely decline in US$ terms. With the global financial crisis the Rupiah has depreciated against the US$, similar to most other developing countries currencies. However, it is safe to assume that in the next few years Indonesia will have a budget which exceeds US$100 billion and is set to reach its own magical threshold of Rp 1,000 trillion in the near future.
One of the most contentious topics over the past decade has been Indonesia's debt and the role of international institutions. Some still think Indonesia has a debt problem and that loans from international institutions, such as the World Bank, have contributed to Indonesia's previous debt burden. The opposite is true, and here's why.
First, let's look at Indonesia's debt. Indonesia's debt levels have declined at an unprecedented rate. As mentioned in my previous blog post, Indonesia is possibly a world-record holder in debt reduction – at least of any large country in recent history – with debt levels declining from 80 percent (2001) to close to 30 percent (2008). In 2001, Indonesia's government had to spend 23 percent of its budget on debt service. Today, it is down to 11 percent, freeing up enormous potential for spending on Indonesia's development.
This performance is remarkable even within East Asia, a region which has generally done well the past decade. Most major countries have kept their debt levels stable. Some countries, like the Philippines, kept their levels stable at relatively high levels (although also declining markedly since 2005); others, like Malaysia, kept debt levels at moderate levels; meanwhile, China stayed in a low range of below 30%. Indonesia is the only country that shows a continued and sharp decline in debt levels and is poised to be one of the countries in the region with the lowest debt levels (see chart 1).
Second, let's look at the role of financing by international institutions such as the World Bank and other development partners. Financing by these international partners has been surprisingly stable over the past 15 years. It has been below or around US$5 billion, except during, and shortly after, the 1998 crisis. During the same period, Indonesia's budget increased from an estimated US$30 billion (1995) to US$100 billion today. In short: in the past, donors made an important financial contribution to Indonesia's development program; today, it is Indonesia's own resources that are driving 95 percent of expenditures (see chart 2).
Loans from official lenders, although declining in relative terms, have actually helped to reduce Indonesia's debt. How is this possible? The main reason is that loans from institutions such as the World Bank are much cheaper than borrowing from the national and international bond markets, the costs of which have increased substantially in recent years. Like almost any other country Indonesia is borrowing to finance its (modest) deficit, to refinance its stock of debt and to attract specific investments, including investment in the infrastructure and social sectors. Had it not been for official lenders, Indonesia would have needed to borrow from other sources at higher interest rates, thus increasing its debt level compared with where it is today.
So where is the problem? Debt is clearly not the main problem, but there is no reason for complacency. Before the 1997/98 Asian crisis, Indonesia also had low debt levels that exploded almost overnight when its banks failed. In addition, recent months have demonstrated that even strong performing developing economies can face difficulties in raising funds.
In my next post, I'll look more closely at what Indonesia is spending its resources on today and the country's opportunities for the next five years.
Fitch Upgrades Indonesia Debt Rating to Decade High
Jan. 25 (Bloomberg) -- Fitch Ratings upgraded Indonesia’s long-term foreign and local-currency credit ratings to the highest level since the Asian financial crisis, citing the economy’s resilience to the global crisis and better finances.
The ratings were raised to BB+ from BB, and are now one level below investment grade, the company said in an e-mailed statement today. The outlook on both ratings is stable, it said.
“The rating action reflects Indonesia’s relative resilience to the severe global financial stress test of 2008- 2009, which has been underpinned by continued improvements in the country’s public finances, a fundamental sovereign rating strength, and a material easing of external financing constraints,” Ngiam Ai Ling, a Fitch director of Asian sovereigns, said in the statement.
Indonesia, which needed a bailout from the International Monetary Fund during the 1997-98 Asian financial crisis, avoided following the world’s largest economies and neighboring countries into a recession last year. The Fitch upgrade comes after the government this month sold $2 billion of 10-year bonds at a higher yield than the Philippines.
“Fitch’s rating move will increase the attractiveness of Indonesian assets,” said Eric Alexander Sugandi, a Jakarta- based economist at Standard Chartered Plc. “Indonesia must attract more foreign investors to accelerate economic growth.”
Moody’s, S&P
Holders of Indonesian debt, including Aberdeen Asset Management Plc and Vegagest SGR SpA, have said the country would need to offer higher yields as a rally in emerging-market bonds slows after the biggest gains in six years.
Government bonds rose after the Fitch upgrade. The yield on the 11 percent note due November 2020 fell four basis points to 9.68 percent, according to midday prices at the Inter Dealer Market Association. A basis point is 0.01 percentage point and bond yields move inversely to prices.
Moody’s Investors Service said on Jan. 21 its Ba2 rating on Indonesia remains stable, while Standard & Poor’s raised the outlook on its BB- rating for the country to positive on Oct. 23. S&P’s rating is three levels below investment grade, and Moody’s is two levels less than investment grade.
The last time Fitch ranked Indonesia’s foreign-currency rating BB+ was in early January 1998. Before today, Indonesia’s local-currency long-term debt was last rated BB+ in April 1999.
Political Boost
Southeast Asia’s biggest economy avoided the global recession following nine interest rate cuts by the central bank and after President Susilo Bambang Yudhoyono’s re-election in July boosted confidence he will maintain policies that have helped the economy expand more than 6 percent in the two years to 2008.
Fitch’s rating upgrade reflects Indonesia’s economic resilience and an improving balance of payments, Bank Indonesia Deputy Governor Hartadi Sarwono said in Jakarta today. Indonesia’s foreign-exchange reserves rose to $69 billion as of Jan. 22, he said.
“There is fiscal stability for the authorities to embark on an ambitious agenda to tackle longer-term developmental issues, such as addressing infrastructure constraints and investment promotion as well as raising industrial and export competitiveness,” Fitch’s Ngiam said.
President Yudhoyono pledged to double infrastructure spending to as much as $140 billion in his second five-year term until 2014 to help boost economic growth.
Bank Indonesia forecasts the economy will expand as much as 5.5 percent this year from an estimated 4.3 percent in 2009. Indonesia may grow an average 6.6 percent annually over the next five years, President Susilo Bambang Yudhoyono said Jan. 4.
The ratings were raised to BB+ from BB, and are now one level below investment grade, the company said in an e-mailed statement today. The outlook on both ratings is stable, it said.
“The rating action reflects Indonesia’s relative resilience to the severe global financial stress test of 2008- 2009, which has been underpinned by continued improvements in the country’s public finances, a fundamental sovereign rating strength, and a material easing of external financing constraints,” Ngiam Ai Ling, a Fitch director of Asian sovereigns, said in the statement.
Indonesia, which needed a bailout from the International Monetary Fund during the 1997-98 Asian financial crisis, avoided following the world’s largest economies and neighboring countries into a recession last year. The Fitch upgrade comes after the government this month sold $2 billion of 10-year bonds at a higher yield than the Philippines.
“Fitch’s rating move will increase the attractiveness of Indonesian assets,” said Eric Alexander Sugandi, a Jakarta- based economist at Standard Chartered Plc. “Indonesia must attract more foreign investors to accelerate economic growth.”
Moody’s, S&P
Holders of Indonesian debt, including Aberdeen Asset Management Plc and Vegagest SGR SpA, have said the country would need to offer higher yields as a rally in emerging-market bonds slows after the biggest gains in six years.
Government bonds rose after the Fitch upgrade. The yield on the 11 percent note due November 2020 fell four basis points to 9.68 percent, according to midday prices at the Inter Dealer Market Association. A basis point is 0.01 percentage point and bond yields move inversely to prices.
Moody’s Investors Service said on Jan. 21 its Ba2 rating on Indonesia remains stable, while Standard & Poor’s raised the outlook on its BB- rating for the country to positive on Oct. 23. S&P’s rating is three levels below investment grade, and Moody’s is two levels less than investment grade.
The last time Fitch ranked Indonesia’s foreign-currency rating BB+ was in early January 1998. Before today, Indonesia’s local-currency long-term debt was last rated BB+ in April 1999.
Political Boost
Southeast Asia’s biggest economy avoided the global recession following nine interest rate cuts by the central bank and after President Susilo Bambang Yudhoyono’s re-election in July boosted confidence he will maintain policies that have helped the economy expand more than 6 percent in the two years to 2008.
Fitch’s rating upgrade reflects Indonesia’s economic resilience and an improving balance of payments, Bank Indonesia Deputy Governor Hartadi Sarwono said in Jakarta today. Indonesia’s foreign-exchange reserves rose to $69 billion as of Jan. 22, he said.
“There is fiscal stability for the authorities to embark on an ambitious agenda to tackle longer-term developmental issues, such as addressing infrastructure constraints and investment promotion as well as raising industrial and export competitiveness,” Fitch’s Ngiam said.
President Yudhoyono pledged to double infrastructure spending to as much as $140 billion in his second five-year term until 2014 to help boost economic growth.
Bank Indonesia forecasts the economy will expand as much as 5.5 percent this year from an estimated 4.3 percent in 2009. Indonesia may grow an average 6.6 percent annually over the next five years, President Susilo Bambang Yudhoyono said Jan. 4.
Kamis, 08 April 2010
Govt moves carefully in offering oil and gas blocks
After failing to find investors for most of the oil and gas blocks offered last year, the government is now making more careful preparations to auction up to 35 new fields later this year.
The Energy and Mineral Resources Ministry has announced the names of the 35 blocks on its official website, but Edy Hermantoro, an upstream oil and gas director at the ministry said the actual number of blocks to be auctioned could be less.
“This is what we call early market research. We announce the blocks so that we can get responses from the oil and gas contractors. The blocks reaching the actual tender process could be only 15 or 20 blocks, depending on the responses of contractors,” Edy said on Monday.
He added that expected contractors’ responses included reactions to the completeness of data on blocks. “They may give us inputs if they think the data is incomplete,” said Edy, adding that the government was focusing on finding serious investors.
On its website on Monday, the ministry announced the maximum 35 blocks planned to be auctioned this year. Of the 35 blocks, 19 are to be offered under regular tender procedures and the remaining 16 blocks are planned to be offered under joint study mechanisms.
Under the latter tender method, interested investors may propose to the government to undertake a joint study to assess oil and gas reserves in one or more blocks.
Once the studies find positive indications of reserves, then the government opens a bidding
process where the first bidding rights will go to the company that proposed, financed and undertook the studies.
The 19 blocks planned to be offered under the regular tender are: East Natuna, SE Baronang, Nias I, Nias II, Tanjung Jabung, Sunda Strait I, Sunda Strait II, Sunda Strait III, West Kangean I, West Kangean II, South Kangean I, South Kangean II, SE Mandar, SW Makassar, West Sebuku, Saliki, East Tarakan, SW Bird Head and Wokam.
The oil and gas blocks planned to be offered under the joint study arrangements include: North Sokang, NW Natuna, Gurita, Sumbagsel (southern Sumatra).
The Energy and Mineral Resources Ministry has announced the names of the 35 blocks on its official website, but Edy Hermantoro, an upstream oil and gas director at the ministry said the actual number of blocks to be auctioned could be less.
“This is what we call early market research. We announce the blocks so that we can get responses from the oil and gas contractors. The blocks reaching the actual tender process could be only 15 or 20 blocks, depending on the responses of contractors,” Edy said on Monday.
He added that expected contractors’ responses included reactions to the completeness of data on blocks. “They may give us inputs if they think the data is incomplete,” said Edy, adding that the government was focusing on finding serious investors.
On its website on Monday, the ministry announced the maximum 35 blocks planned to be auctioned this year. Of the 35 blocks, 19 are to be offered under regular tender procedures and the remaining 16 blocks are planned to be offered under joint study mechanisms.
Under the latter tender method, interested investors may propose to the government to undertake a joint study to assess oil and gas reserves in one or more blocks.
Once the studies find positive indications of reserves, then the government opens a bidding
process where the first bidding rights will go to the company that proposed, financed and undertook the studies.
The 19 blocks planned to be offered under the regular tender are: East Natuna, SE Baronang, Nias I, Nias II, Tanjung Jabung, Sunda Strait I, Sunda Strait II, Sunda Strait III, West Kangean I, West Kangean II, South Kangean I, South Kangean II, SE Mandar, SW Makassar, West Sebuku, Saliki, East Tarakan, SW Bird Head and Wokam.
The oil and gas blocks planned to be offered under the joint study arrangements include: North Sokang, NW Natuna, Gurita, Sumbagsel (southern Sumatra).
Relocation of overseas factories lifts shoe exports
Relocation of shoe factories from other Asian countries such as China and Vietnam to Indonesia will help boost Indonesian footwear exports, an association of local shoe producers has said.
Harijanto, a senior executive of the Indonesian Footwear Association (Aprisindo) said that shoe exports were predicted to rise by 11 percent to US$2 billion this year from $1.8 billion recorded last year. This increase is partly due to the relocation of factories from China and Vietnam to Indonesia, in addition to expansion of existing footwear factories.
“Our exports can even reach more than $2 billion when the relocation and expansion projects
have been fully completed,” he said during a press conference in Jakarta. He said footwear exports had already reached more than $400 million in the first three months of the year.
At present, Indonesia is the third largest footwear exporter in the world after China and Vietnam.
Harijanto also said he expected that in the next five years, footwear exports would pass the $2.4 billion target, the record high previously achieved in 1996 just before the Asian banking and financial crisis hit the country in 1998, causing severe currency depreciation.
According to Harijanto, there are three sports shoe brands that used to be manufactured on the mainland of China which are now produced here. These include Mizuno and Asics Tiger, both originally from Japan, as well as New Balance from the United States.
Orders for Mizuno and New Balance are now handled by PT Panarub Dwikarya, while Asics Tiger shoes are produced by the Indonesian subsidiary of Taiwanese company Shang Yao Fung.
Meanwhile, Adidas and Nike have also increased their orders to local manufacturers, he said, without giving further details.
It is estimated that local footwear manufacturers are expected to spend $200 million in new investment in the next few years to boost production. “Their total production can reach about 20 million pairs by the end of 2011,” Harijanto.
For example, he said, production of New Balance shoes would increase from 50,000 pairs last year to 500,000 pairs by the end of this year and would eventually reach 1 million pairs per annum next year.
Harijanto said more and more global brand footwear companies were relocating factories from China to Indonesia.
Other Chinese companies are switching orders for branded shoes to their Indonesian partners rather than relocating factories, he said.
“China’s economy is already overheating. Their production is too big back there,” he said. “They are worried something would happen if anything gets too big.”
Relocation of overseas factories along with expansion of local shoe factory production will contribute to the projected increase in RI production figures, he said.
Harijanto, a senior executive of the Indonesian Footwear Association (Aprisindo) said that shoe exports were predicted to rise by 11 percent to US$2 billion this year from $1.8 billion recorded last year. This increase is partly due to the relocation of factories from China and Vietnam to Indonesia, in addition to expansion of existing footwear factories.
“Our exports can even reach more than $2 billion when the relocation and expansion projects
have been fully completed,” he said during a press conference in Jakarta. He said footwear exports had already reached more than $400 million in the first three months of the year.
At present, Indonesia is the third largest footwear exporter in the world after China and Vietnam.
Harijanto also said he expected that in the next five years, footwear exports would pass the $2.4 billion target, the record high previously achieved in 1996 just before the Asian banking and financial crisis hit the country in 1998, causing severe currency depreciation.
According to Harijanto, there are three sports shoe brands that used to be manufactured on the mainland of China which are now produced here. These include Mizuno and Asics Tiger, both originally from Japan, as well as New Balance from the United States.
Orders for Mizuno and New Balance are now handled by PT Panarub Dwikarya, while Asics Tiger shoes are produced by the Indonesian subsidiary of Taiwanese company Shang Yao Fung.
Meanwhile, Adidas and Nike have also increased their orders to local manufacturers, he said, without giving further details.
It is estimated that local footwear manufacturers are expected to spend $200 million in new investment in the next few years to boost production. “Their total production can reach about 20 million pairs by the end of 2011,” Harijanto.
For example, he said, production of New Balance shoes would increase from 50,000 pairs last year to 500,000 pairs by the end of this year and would eventually reach 1 million pairs per annum next year.
Harijanto said more and more global brand footwear companies were relocating factories from China to Indonesia.
Other Chinese companies are switching orders for branded shoes to their Indonesian partners rather than relocating factories, he said.
“China’s economy is already overheating. Their production is too big back there,” he said. “They are worried something would happen if anything gets too big.”
Relocation of overseas factories along with expansion of local shoe factory production will contribute to the projected increase in RI production figures, he said.
At least 20 injured in Aceh quake
The 7.2 magnitude earthquake in Simelue regency, Aceh, had injured 20 people as of 3 p.m., a statement from the Health Ministry said.
The quake had not killed any residents and no evacuation process had been conducted, the statement added.
The injured victims have been treated in hospitals' parking lot.
According to the release, the local hospitals and the Simeulue Health Agency thus far could still manage the situation.
As many as two community health centers (Puskesmas) and one assisting health centers underwent a medium-scale damage, while six health centers and two assisting health centers experienced mild-scale ones.
The quake had not killed any residents and no evacuation process had been conducted, the statement added.
The injured victims have been treated in hospitals' parking lot.
According to the release, the local hospitals and the Simeulue Health Agency thus far could still manage the situation.
As many as two community health centers (Puskesmas) and one assisting health centers underwent a medium-scale damage, while six health centers and two assisting health centers experienced mild-scale ones.
SBY promises to protect local industries
President Susilo Bambang Yudhoyono promises the government will protect sectors threatened to be harmed with the full implementation of the ASEAN-China Free Trade Area (ACFTA).
The President told a press conference here Wednesday the government was paying considerable attention to the Indonesian public’s concerns over the implementation of ACFTA and promised it would seek solutions for any problems possibly emerging from the agreement.
Many local industries have expressed fear over possible influx of cheap Chinese products that will harm their own as a result of the full implementation of ACFTA.
The government has been criticized for not being able to address the matter.
“The government is paying attention to ACFTA problems,” Yudhoyono said in response to the concerns.
“It is of our agenda to improve the partnership between the two countries, and we will discuss well any problems concerning certain sectors possibly emerging from (the implementation of ACFTA), and find
solutions for the problems,” he added.
The President said the government would ensure that both workers and local industries were well-protected from negative impacts of the ACFTA.
“Chinese Prime Minister Wen Jiabao will visit Indonesia in late April… We will discuss a partnership that will be of great benefits for both China and Indonesia,” he said.
The President explained that both countries had signed a strategic partnership in a number of fields, including the economy.
He added that China had expressed intention to boost cooperation with the archipelago in the field of infrastructure, energy and trade.
The President told a press conference here Wednesday the government was paying considerable attention to the Indonesian public’s concerns over the implementation of ACFTA and promised it would seek solutions for any problems possibly emerging from the agreement.
Many local industries have expressed fear over possible influx of cheap Chinese products that will harm their own as a result of the full implementation of ACFTA.
The government has been criticized for not being able to address the matter.
“The government is paying attention to ACFTA problems,” Yudhoyono said in response to the concerns.
“It is of our agenda to improve the partnership between the two countries, and we will discuss well any problems concerning certain sectors possibly emerging from (the implementation of ACFTA), and find
solutions for the problems,” he added.
The President said the government would ensure that both workers and local industries were well-protected from negative impacts of the ACFTA.
“Chinese Prime Minister Wen Jiabao will visit Indonesia in late April… We will discuss a partnership that will be of great benefits for both China and Indonesia,” he said.
The President explained that both countries had signed a strategic partnership in a number of fields, including the economy.
He added that China had expressed intention to boost cooperation with the archipelago in the field of infrastructure, energy and trade.
Obama heads to Prague to sign arms deal
President Barack Obama's vision of a world without nuclear arms moves closer to reality on Thursday when he and President Dmitry Medvedev sign a pivotal treaty aimed at sharply paring U.S. and Russian arsenals while working to repair soured relations.
Obama has not been able to deliver on all of the nuclear aspirations he outlined in Prague just a year ago - visions on disarmament that helped earn him the Nobel Peace Prize. Back then, a landmark speech to an enthusiastic crowd gathered in a Prague square included a promise to quickly seek ratification of a comprehensive nuclear test ban.
That goal remains unfulfilled. But on Thursday, the Czech capital will serve as the venue of a pledge achieved.
At noon in the Spanish Hall - a lavish Renaissance chamber within the Czech's capital's ornate presidential castle complex - the U.S. and Russian presidents will sign the "New START" treaty. With that, they will commit their nations to slash the number of strategic nuclear warheads by one-third and more than halve the number of missiles, submarines and bombers carrying them, pending ratification by their legislatures.
The new treaty will shrink those warheads to 1,550 over seven years. That still allows for mutual destruction several times over. But it will send a strong signal that Russia and the U.S., which between them own more than 90 percent of the world's nuclear weapons, are serious about disarmament.
And it opens the way for further cuts. U.S. Secretary of State Hillary Rodham Clinton said Tuesday that Obama has instructed his national security team to pursue another round of arms reduction talks with Russia, to follow up on the replacement for the 1991 Strategic Arms Reduction Treaty being signed Thursday.
The aim would be to conduct wider talks to include for the first time short-range U.S. and Russian nuclear weapons as well as weapons held in reserve or in storage.
Beyond deeply reducing nuclear arsenals, the U.S. sees "New START" as a key part of efforts to "reset" ties with Russia, which had become badly strained under the Bush administration and engage Moscow more in dealing with global challenges. Among these is Iran's defiance of U.N. Security Council demands that it curb its nuclear program to ease fears it seeks to make nuclear arms.
The new pact is only part of the Obama administration's new nuclear strategy. It will be signed only days after the White House announced a fundamental shift that calls the spread of atomic weapons to terrorists or rogue states - nations, like North Korea or Iran that do not abide by nonproliferation rules - a worse menace than the Cold War threat of mutual destruction.
"For the first time, preventing nuclear proliferation and nuclear terrorism is now at the top of America's nuclear agenda," Obama said Tuesday in detailing key components of an in-depth nuclear strategy review.
While the formal occasion is signing the treaty, Obama is expected to use the occasion to push for Russian support for new U.N. sanctions to punish Iran's refusal to give up uranium enrichment. Chances of enlisting China, an even more stubborn opponent of Iran sanctions than Moscow, improve if the Kremlin is on board.
Other U.S. nuclear initiatives will follow the Prague signing, with the White House planning to lead calls for disarmament in May at the United Nations during an international conference on strengthening the Nuclear Nonproliferation Treaty. Before that, government leaders from more than 40 countries will gather in Washington next week to discuss boosting defenses against terrorists seeking nuclear weapons.
The deep cuts in warheads and delivery systems and a legally binding system to ensure against cheating, makes "New START" the most significant nuclear arms treaty in a generation, and Medvedev, in comments published before the signing lauded it as "an important step" in disarmament and arms control efforts.
Some Russian arms control analysts say Russia badly needed the deal to ease the burden of replacing a large number of Soviet-built missiles which need to be decommissioned for age. "This treaty is in Russia's best interests," said Sergei Rogov, the head of the USA and Canada Institute, an influential think tank that advises the Kremlin on foreign policy.
Russian Foreign Minister Sergei Lavrov said the deal could "open new possibilities for developing the U.S.-Russian partnership" - but warned Moscow reserves the right to withdraw if the planned U.S. missile defense system grows into a threat.
Russia has welcomed Obama's decision to scrap the previous administration's plans for missile defense sites in Poland and the Czech Republic while voicing concern about the prospects of a revamped U.S. project, including a planned facility in Romania.
Lavrov said that the site in Romania poses no immediate threat, but added that Russia will closely watch further U.S. missile deployments and could opt out of the new treaty if it sees that U.S. missile interceptors acquire a capability to intercept Russia's strategic missiles.
Russia shares Obama's goal of a nuclear-free world, but other nations must join the disarmament process, he said.
Moscow also warned that the U.S. plans to fit some of its nuclear-tipped missiles with conventional warheads could be an obstacle to ridding the world of nuclear weapons.
Lavrov argued that Russia views such weapons as just as destabilizing as nukes.
Russia hasn't tried to follow the U.S. example partly because most of its missiles lack precision for hitting pinpoint targets with conventional explosives. Its conventional military forces has steadily degraded, prompting the military to rely increasingly on nuclear weapons.
While the docile Russian parliament will do the Kremlin's bidding on the treaty, the ratification process in the U.S. Senate could be troublesome. Fearing potential trouble, Moscow has said that Russian lawmakers will synchronize their moves to ratify the deal with the U.S. legislators.
Sensitive to East European concerns, Obama is tending to other business while in Prague - hosting a dinner for leaders from 11 Central and Eastern European nations formerly in or near Moscow's orbit, who worry about the Kremlin's post-communist push for influence.
Obama has not been able to deliver on all of the nuclear aspirations he outlined in Prague just a year ago - visions on disarmament that helped earn him the Nobel Peace Prize. Back then, a landmark speech to an enthusiastic crowd gathered in a Prague square included a promise to quickly seek ratification of a comprehensive nuclear test ban.
That goal remains unfulfilled. But on Thursday, the Czech capital will serve as the venue of a pledge achieved.
At noon in the Spanish Hall - a lavish Renaissance chamber within the Czech's capital's ornate presidential castle complex - the U.S. and Russian presidents will sign the "New START" treaty. With that, they will commit their nations to slash the number of strategic nuclear warheads by one-third and more than halve the number of missiles, submarines and bombers carrying them, pending ratification by their legislatures.
The new treaty will shrink those warheads to 1,550 over seven years. That still allows for mutual destruction several times over. But it will send a strong signal that Russia and the U.S., which between them own more than 90 percent of the world's nuclear weapons, are serious about disarmament.
And it opens the way for further cuts. U.S. Secretary of State Hillary Rodham Clinton said Tuesday that Obama has instructed his national security team to pursue another round of arms reduction talks with Russia, to follow up on the replacement for the 1991 Strategic Arms Reduction Treaty being signed Thursday.
The aim would be to conduct wider talks to include for the first time short-range U.S. and Russian nuclear weapons as well as weapons held in reserve or in storage.
Beyond deeply reducing nuclear arsenals, the U.S. sees "New START" as a key part of efforts to "reset" ties with Russia, which had become badly strained under the Bush administration and engage Moscow more in dealing with global challenges. Among these is Iran's defiance of U.N. Security Council demands that it curb its nuclear program to ease fears it seeks to make nuclear arms.
The new pact is only part of the Obama administration's new nuclear strategy. It will be signed only days after the White House announced a fundamental shift that calls the spread of atomic weapons to terrorists or rogue states - nations, like North Korea or Iran that do not abide by nonproliferation rules - a worse menace than the Cold War threat of mutual destruction.
"For the first time, preventing nuclear proliferation and nuclear terrorism is now at the top of America's nuclear agenda," Obama said Tuesday in detailing key components of an in-depth nuclear strategy review.
While the formal occasion is signing the treaty, Obama is expected to use the occasion to push for Russian support for new U.N. sanctions to punish Iran's refusal to give up uranium enrichment. Chances of enlisting China, an even more stubborn opponent of Iran sanctions than Moscow, improve if the Kremlin is on board.
Other U.S. nuclear initiatives will follow the Prague signing, with the White House planning to lead calls for disarmament in May at the United Nations during an international conference on strengthening the Nuclear Nonproliferation Treaty. Before that, government leaders from more than 40 countries will gather in Washington next week to discuss boosting defenses against terrorists seeking nuclear weapons.
The deep cuts in warheads and delivery systems and a legally binding system to ensure against cheating, makes "New START" the most significant nuclear arms treaty in a generation, and Medvedev, in comments published before the signing lauded it as "an important step" in disarmament and arms control efforts.
Some Russian arms control analysts say Russia badly needed the deal to ease the burden of replacing a large number of Soviet-built missiles which need to be decommissioned for age. "This treaty is in Russia's best interests," said Sergei Rogov, the head of the USA and Canada Institute, an influential think tank that advises the Kremlin on foreign policy.
Russian Foreign Minister Sergei Lavrov said the deal could "open new possibilities for developing the U.S.-Russian partnership" - but warned Moscow reserves the right to withdraw if the planned U.S. missile defense system grows into a threat.
Russia has welcomed Obama's decision to scrap the previous administration's plans for missile defense sites in Poland and the Czech Republic while voicing concern about the prospects of a revamped U.S. project, including a planned facility in Romania.
Lavrov said that the site in Romania poses no immediate threat, but added that Russia will closely watch further U.S. missile deployments and could opt out of the new treaty if it sees that U.S. missile interceptors acquire a capability to intercept Russia's strategic missiles.
Russia shares Obama's goal of a nuclear-free world, but other nations must join the disarmament process, he said.
Moscow also warned that the U.S. plans to fit some of its nuclear-tipped missiles with conventional warheads could be an obstacle to ridding the world of nuclear weapons.
Lavrov argued that Russia views such weapons as just as destabilizing as nukes.
Russia hasn't tried to follow the U.S. example partly because most of its missiles lack precision for hitting pinpoint targets with conventional explosives. Its conventional military forces has steadily degraded, prompting the military to rely increasingly on nuclear weapons.
While the docile Russian parliament will do the Kremlin's bidding on the treaty, the ratification process in the U.S. Senate could be troublesome. Fearing potential trouble, Moscow has said that Russian lawmakers will synchronize their moves to ratify the deal with the U.S. legislators.
Sensitive to East European concerns, Obama is tending to other business while in Prague - hosting a dinner for leaders from 11 Central and Eastern European nations formerly in or near Moscow's orbit, who worry about the Kremlin's post-communist push for influence.
Senin, 29 Maret 2010
Light participation
Fish traders at Kramat Jati market in East Jakarta kept their lights on during the Earth Hour campaign, on Saturday evening when people were supposed to turn off their lights, although many were unaware of this. Many night workers had to keep their lights on between 8:30 p.m. and 9:30 p.m.
Officials: Suicide bombs kill 35 on Moscow subway
Two female suicide bombers blew themselves up on Moscow's subway system as it was jam-packed with rush-hour passengers Monday, killing at least 35 people and wounding more than 30, the city's mayor and other officials said.
Emergency Ministry pokeswoman Svetlana Chumikova said 23 people were killed at the Lubyanka station in central Moscow. The station is underneath the building that houses the main offices of the Federal Security Service, or FSB, the KGB's main successor agency.
A second explosion hit the Park Kultury station about 45 minutes later. Chumikova said at least 12 were dead there.
Moscow Mayor Yuri Luzhkov said both explosions were believed to have been set off by female suicide bombers as the trains entered the stations. In the first case, officials said the explosion was on the train; there was no immediate information on the location of the second blast.
"The first data that the FSB has given us is that there were two female suicide bombers," Luzhkov told reporters at the Park Kultury site.
Russia's top investigative body also said terrorism was suspected.
The last confirmed terrorist attack in Moscow was in August 2004, when a suicide bomber blew herself up outside a city subway station, killing 10 people.
Responsibility for that blast was claimed by Chechen rebels and suspicion in Monday's explosions is likely to focus on them and other separatist groups in the restive North Caucasus region.
The Moscow subway system is one of the world's busiest, carrying around 7 million passengers on an average workday, and is a key element in running the sprawling and traffic-choked city.
The blasts practically paralyzed movement in the city center as emergency vehicles sped to the stations. Helicopters hovered over the Park Kultury station area, which is near the renowned Gorky Park.
Passengers, many of them in tears, streamed out of the station, one man exclaiming over and over "This is how we live!"
At least a dozen ambulances were on the scene.
Emergency Ministry pokeswoman Svetlana Chumikova said 23 people were killed at the Lubyanka station in central Moscow. The station is underneath the building that houses the main offices of the Federal Security Service, or FSB, the KGB's main successor agency.
A second explosion hit the Park Kultury station about 45 minutes later. Chumikova said at least 12 were dead there.
Moscow Mayor Yuri Luzhkov said both explosions were believed to have been set off by female suicide bombers as the trains entered the stations. In the first case, officials said the explosion was on the train; there was no immediate information on the location of the second blast.
"The first data that the FSB has given us is that there were two female suicide bombers," Luzhkov told reporters at the Park Kultury site.
Russia's top investigative body also said terrorism was suspected.
The last confirmed terrorist attack in Moscow was in August 2004, when a suicide bomber blew herself up outside a city subway station, killing 10 people.
Responsibility for that blast was claimed by Chechen rebels and suspicion in Monday's explosions is likely to focus on them and other separatist groups in the restive North Caucasus region.
The Moscow subway system is one of the world's busiest, carrying around 7 million passengers on an average workday, and is a key element in running the sprawling and traffic-choked city.
The blasts practically paralyzed movement in the city center as emergency vehicles sped to the stations. Helicopters hovered over the Park Kultury station area, which is near the renowned Gorky Park.
Passengers, many of them in tears, streamed out of the station, one man exclaiming over and over "This is how we live!"
At least a dozen ambulances were on the scene.
KPK questions BI deputy governor Budi Mulya in Century case
The Corruption Eradication Commission [KPK] questioned deputy governor of Bank Indonesia Budi Mulya Monday about his possible involvement in the Bank Century bailout case.
“It’s a continuing investigation following a previous probe of [another] BI deputy governor Pak Budi Rochadi [some time ago],” KPK spokesman Johan Budi said as quoted by kompas.com.
Budi Mulya was being questioned in relation to BI's Rp 689 billion (US$75.1 million) liquidity assistance to the ailing Bank Century in 2008.
The antigraft body is focusing its investigations on graft that allegedly occurred in Bank Century's handling of the BI liquidity assistance and the Rp 6.76 trillion (US$716 million) bailout, and the subsequent channeling of funds.
“It’s a continuing investigation following a previous probe of [another] BI deputy governor Pak Budi Rochadi [some time ago],” KPK spokesman Johan Budi said as quoted by kompas.com.
Budi Mulya was being questioned in relation to BI's Rp 689 billion (US$75.1 million) liquidity assistance to the ailing Bank Century in 2008.
The antigraft body is focusing its investigations on graft that allegedly occurred in Bank Century's handling of the BI liquidity assistance and the Rp 6.76 trillion (US$716 million) bailout, and the subsequent channeling of funds.
Bakrieland to build Disneyland in Sukabumi
PT Bakrieland Development is planning to expand its entertainment and recreational properties by building a Disneyland park, following the development of its Jungle Water Park at the Lido tourism spot in Sukabumi, West Java.
The American-based Disneyland project plan is in line with Bakrie’s 54-kilometer toll road project that will connect Ciawi and Sukabumi, kompas.com reported Monday
Bakrieland president director Hiramsyah S. Thaib, however, declined to elaborate on the proposed Disneyland project.
The American-based Disneyland project plan is in line with Bakrie’s 54-kilometer toll road project that will connect Ciawi and Sukabumi, kompas.com reported Monday
Bakrieland president director Hiramsyah S. Thaib, however, declined to elaborate on the proposed Disneyland project.
Rabu, 24 Maret 2010
Analysis: The ‘drivers’ that make drivers choose new cars in Indonesia
Like many cities around the world, traffic on the road is a nightmare in Jakarta except perhaps between 2 a.m. and 6 a.m. Other metros like Surabaya and Bandung aren’t far behind. Whether its good news or bad, the fact remains that only 3.5 percent of Indonesian households can afford to maintain the family car. Another 31 percent have opted for the family motorcycle. There are three million car drivers, not including taxi bus or truck drivers. In contrast, there are 45 million motorcycle riders. Many of them would like a car instead, which would strangulate the city and cause rigour-mortis to set in. Any hope of a real mass transit system seems remote, to be believed only when it is real. So Jakartans still have some room to crawl in, what little there is left.
In the meantime, the car industry is still crawling on the road to recovery. The elite group of car buyers were among the small fraction of Indonesian society affected or concerned by the global financial crisis. Demand is yet to go back to levels similar to the days leading up to the fuel price hikes. As at December 2009, there were 1.54 million people thinking of buying a car in the next four years. 1.29 million of them were considering a used vehicle, leaving only 298,000 in the market for a new car.
That’s cars for consumers, not including commercial, government, military or police fleet purchases.
In a world where the capacity to supply is far in excess of current demand, carmakers from around the world are flocking to Indonesia. From Ferrari and Porsche to Renault and Citroen, they are all now here for a piece of the action. The multi-billion rupiah question is whether they all know what the Indonesian aspiring to buy a new car really wants today. Roy Morgan Single Source has quite a few answers for anybody who is interested. Twenty seven percent of people thinking of a new car want a four-door station wagon, which definition in Indonesia of course includes the trusty Kijang. 25 percent want a five-door hatchback and 13 percent a three-door version.
But there’s a remarkable 12-percent who desire a coupe, sports or two-door convertible. That translates to roughly 36,000 units of big boys’ toys. Back to reality, another 9 percent are keen on a people mover or van. Almost 5 percent are thinking pick-up, just 4 percent the classic four-door sedan. The original SUV will be considered by only 1.4 percent of new car buyers. That just about wraps up who wants what. Except of course, the brands. Today, Honda leads with 26 percent share of the ‘future market’, closely followed by Toyota with 25. Way behind them is Mitsubishi with 7 percent.
Suzuki, Mazda, Daihatsu and Nissan seem to have lost their shine, falling behind the more prestige names like Jaguar, Mercedes-Benz and BMW.
Then there’s the other set of multi-billion rupiah questions, why they want what what they want. While pleasure seekers have different wants from the needs of the family man, the opinions of all new car intenders in Indonesia produce an interesting diversity of expectations. Reputation still leads.
Eighty six percent “will only buy a car with a proven track record”. The same number “need lots of space and seating flexibility in a vehicle”. That’s followed by 82 percent with “ a long warranty is essential to me when buying my new car”. Not surprisingly, 82 percent believe “when I’m making a major purchase I tend to rely on facts and figures rather than gut feel”.
Many women are likely to smirk at this attempt at rationalizing bad choices based on looks alone. Marketers however must acknowledge that well-worn phrase, perception is reality. Fact or fiction, many buyers need the assurance of logic before they are willing to acknowledge falling prey to magic.
Cognitive dissonance or post-purchase rationalization aside, the fact remains that “after reliability, looks and style are most important to me” is a view shared by 73 percent of intenders.
“Safety is my number one concern” believes eight out of 10 buyers, with almost as many agreeing that “performance and road-holding are my number one concern”. Seventy eight percent “want a car that has all the extras as standard” while 74 percent “spend a lot of time researching my options before deciding what car to buy”. How many of these concerns are known and addressed by automakers operating in Indonesia, one wonders. There is little evidence or acknowledgement of these needs and wants in the advertising that we see.
These conclusions are based on Roy Morgan Single Source, a syndicated survey with over 25,000 Indonesians 14 years and older interviewed each year. The national database, comprising interviews conducted in the cities, towns and villages around the country is updated every quarter.
Gas shortage costs PLN up to Rp 2.4 trillion
State power firm PT PLN must carry operating costs which are Rp 2.4 trillion (US$263 million) higher than planned this year due to gas shortages affecting its Muara Tawar power plant at Bekasi, West Java.
PLN’s primary energy director Nur Pamudji said less gas supply means more oil fuel consumption.
“We must increase the power plant’s oil-based consumption by 618,000 kiloliters until the end of this year and this will cost us additional spending of Rp 2.4 trillion,” Nur Pamudji said.
PLN’s head of corporate finance division Yusuf Hamdani said the production cost of electricity generated from oil-based fuels was far higher than that generated from gas.
“In 2009, the average production cost for gas was Rp 318 per kWh [kilowatt hour], while the production cost for oil-based fuel was Rp 1,383 per kWh,”Yusuf said.
The combined cycle Muara Tawar power plant can use both diesel oil and gas. The plant receives gas from state gas distributor PT Perusahaan Gas Negara (PGN).
PGN and PLN have signed two gas sales and purchase contracts for the power plant. Under the first contract, PGN must supply as much as 200 billion British thermal units of gas per day (BBTUD) to PLN until 2012. As for the second contract, PGN has to supply 100 BBTUD to PLN for the same period. But the second contract is interruptible, meaning PGN will only supply PLN when additional gas is available.
Nur Pamudji said the gas supply had dropped to 100 BBTUD since early March, this year from an average of 250 BBTUD in 2009. “I thought the shortage was only temporary, but later on it became clear that the shortage could last until December,” Nur Pamudji said.
The Muara Tawar power plant comprises four operating units. “Currently, only one unit still receives gas,” Nur Pamudji said.
PGN’s gas supply to PLN and other industries fell this year due to a decline in the gas supply from ConocoPhillips’s South Sumatra field, PGN’s president director Hendi Prio Santoso said as quoted by Bloomberg last week.
Gas contributes 26 percent to PLN’s total energy consumption. Coal and oil-based fuels contribute 45 percent and 19 percent, respectively. The remaining 10 percent is from new and renewable energy sources such as hydro and geothermal.
PLN’s coal consumption has increased as some of the power plants planned and financed under the
first phase of the first 10,000 megawatt (MW) electricity crash program have started to come into operation.
All power plants under the first 10,000 MW project are coal-fired power plants. Nur Pamudji said PLN coal consumption reached 30 million tons this year, up from 22 million tons in 2009. However PLN coal consumption to feed an increased number of coal-fired power stations coming on stream is estimated to increase to 38 million tons in 2011.
PLN’s primary energy director Nur Pamudji said less gas supply means more oil fuel consumption.
“We must increase the power plant’s oil-based consumption by 618,000 kiloliters until the end of this year and this will cost us additional spending of Rp 2.4 trillion,” Nur Pamudji said.
PLN’s head of corporate finance division Yusuf Hamdani said the production cost of electricity generated from oil-based fuels was far higher than that generated from gas.
“In 2009, the average production cost for gas was Rp 318 per kWh [kilowatt hour], while the production cost for oil-based fuel was Rp 1,383 per kWh,”Yusuf said.
The combined cycle Muara Tawar power plant can use both diesel oil and gas. The plant receives gas from state gas distributor PT Perusahaan Gas Negara (PGN).
PGN and PLN have signed two gas sales and purchase contracts for the power plant. Under the first contract, PGN must supply as much as 200 billion British thermal units of gas per day (BBTUD) to PLN until 2012. As for the second contract, PGN has to supply 100 BBTUD to PLN for the same period. But the second contract is interruptible, meaning PGN will only supply PLN when additional gas is available.
Nur Pamudji said the gas supply had dropped to 100 BBTUD since early March, this year from an average of 250 BBTUD in 2009. “I thought the shortage was only temporary, but later on it became clear that the shortage could last until December,” Nur Pamudji said.
The Muara Tawar power plant comprises four operating units. “Currently, only one unit still receives gas,” Nur Pamudji said.
PGN’s gas supply to PLN and other industries fell this year due to a decline in the gas supply from ConocoPhillips’s South Sumatra field, PGN’s president director Hendi Prio Santoso said as quoted by Bloomberg last week.
Gas contributes 26 percent to PLN’s total energy consumption. Coal and oil-based fuels contribute 45 percent and 19 percent, respectively. The remaining 10 percent is from new and renewable energy sources such as hydro and geothermal.
PLN’s coal consumption has increased as some of the power plants planned and financed under the
first phase of the first 10,000 megawatt (MW) electricity crash program have started to come into operation.
All power plants under the first 10,000 MW project are coal-fired power plants. Nur Pamudji said PLN coal consumption reached 30 million tons this year, up from 22 million tons in 2009. However PLN coal consumption to feed an increased number of coal-fired power stations coming on stream is estimated to increase to 38 million tons in 2011.
RI, HK agree to eliminate double taxation, tax evasion
Indonesia and Hong Kong signed a bilateral agreement Tuesday on the avoidance of double taxation and the prevention of tax evasion in the hope of enhancing mutual business opportunities.
The agreement will eliminate double taxation issues encountered by Hong Kong and Indonesian businesses, and bring lower tax rates to cross-border economic activities.
It was signed by Hong Kong Financial Secretary John C. Tsang and Indonesian Finance Minister Sri
Mulyani Indrawati.
“This would help in doing business in Hong Kong and Indonesia. It provides certainty for businesses.
They will pay less tax than they are now. So we expect this would facilitate and enhance business opportunities,” Tsang said in an interview with The Jakarta Post.
He said Hong Kong and Indonesia should foster closer business cooperation after the recent global financial crisis. He said trade in Asia should be expanded to compensate for the decline in exports to the US and EU countries.
“We can do more things together, particularly as our traditional markets — the US and EU countries — are importing less. So I think we need to expand our own regional market to compensate for exports we have lost in traditional markets,” he said.
Under the agreement, he said, Hong Kong and Indonesian businesses will have their taxes more than halved.
Tax income on dividends which now stand at 20 percent, will be cut to 10 percent; and for a shareholder owning at least a 25 percent share in a company, tax will be further reduced to 5 percent.
Tax on royalties, which now stand at 20 percent, will be capped at 5 percent.
The Indonesian directorate general of taxation said it would pursue similar tax agreements with other countries to pursue tax evaders.
“We’re negotiating with Serbia and Oman. We’re renegotiating with Malaysia and some European countries. What’s important is information exchange. We can ask information now,” said Syarifuddin Alsah, director of tax regulations.
On Tuesday, Tsang also met the central bank to discuss cross-border banking supervision and
development of Islamic finance, which he said was an “ethical investment tool”.
“We see a lot of potential for Islamic finance as an alternative investment. Not only for Muslims, but for everyone,” he said.
Tsang said on Wednesday he would meet the Coordinating Economic Minister Hatta Rajasa, Trade Minister Mari Elka Pangestu and Fuad Rahmany, head of the Capital Market and Financial Institutions Supervisory Agency, to discuss various issues.
He also explained that Hong Kong would become a platform for the internationalization of the Chinese currency the renminbi to become one of the world’s convertible currencies, which would change the dynamics of the world currency system.
“Now the US dollar is the main reserve currency, the main currency for business in the world for
most transactions. But as the economy of China grows, as the business involving Chinese entities grows in the future, then the renminbi will become a more important currency,” he said.
“When it becomes a convertible currency, a significant and international currency, certainly the dynamic of it, and also of the US dollar, and the euro, will surely change. But we have to look at the geopolitics at that time. So we can see how things will change,” he added.
Few firms join industry revitalization program
The Industry Ministry has reduced the amount budgeted to its machinery revitalization program in the textile, footwear and leather industries, as well as sugar mills, due to the lack of response from eligible firms.
This year, the government is allocating a total of Rp 202.74 billion (US$22.3 million) for industrial revitalization, including Rp 144.35 billion for textile firms, Rp 34.25 billion for footwear and leather companies and Rp 24.14 billion for sugar mills, the ministry announced Tuesday.
Last year, the government allocated Rp 342.5 billion to the same sectors under the same program, providing manufacturers with access to incentives to help them replace old machines with new ones to help improve industrial competitiveness.
“In absolute size, the total budget has been cut from Rp 342.5 billion last year to Rp 202.74 billion this year,” the ministry’s director general for metal, machinery, textile and miscellaneous industries Ansari Bukhari said during the launch of this year’s program at his office.
“We have learned our lessons that the utilization of the budget would only amount on average to between 63 and 64 percent of the total.”
He said he expected budget spending would be more efficient and effective with the cuts.
Likewise, the ministry’s inspector general Sakri Widianto said, “It’s not about the size of the budget is, but how much it’s spent.”
Unlike in the textile industry, fewer participants were interested in the proposed program for the footwear and leather industries and sugar mills, Ansari said.
He elaborated that these companies had been reluctant to join last year’s program due to market uncertainties caused by the continuing negative impacts of the global financial crisis.
He also said the ministry had to remove the Scheme Two component of the program due to the lack of response from producers despite the fact that the program had been implemented three years running.
There are two schemes in the textile machinery revitalizing program. Under Scheme One, the government provides 10 percent discounts for manufacturers who want to purchase new machines, while Scheme Two is aimed at small and medium enterprises and provides soft loans.
“Apparently, the number of applicants under Scheme Two was very low, while on the manpower side it took a lot of work to do the administration,” said Ansari.
Secretary of directorate general for small and medium industries Andang Fatati Nadya said her office had begun this year to include the textile, footwear and leather industries in its discount program.
“We will give 25 percent discount for every machine purchased overseas and 30 percent discount for every machine purchased locally,” she said. The machines should be worth between Rp 40 million and Rp 2 billion each, she said.
In addition, the director for the textile industry Arryanto Sagala said there were reportedly four participants under Scheme Two in 2007 and two in 2008 who could not pay their debts on their soft loans. This may have discouraged borrowers.
This year, the government is allocating a total of Rp 202.74 billion (US$22.3 million) for industrial revitalization, including Rp 144.35 billion for textile firms, Rp 34.25 billion for footwear and leather companies and Rp 24.14 billion for sugar mills, the ministry announced Tuesday.
Last year, the government allocated Rp 342.5 billion to the same sectors under the same program, providing manufacturers with access to incentives to help them replace old machines with new ones to help improve industrial competitiveness.
“In absolute size, the total budget has been cut from Rp 342.5 billion last year to Rp 202.74 billion this year,” the ministry’s director general for metal, machinery, textile and miscellaneous industries Ansari Bukhari said during the launch of this year’s program at his office.
“We have learned our lessons that the utilization of the budget would only amount on average to between 63 and 64 percent of the total.”
He said he expected budget spending would be more efficient and effective with the cuts.
Likewise, the ministry’s inspector general Sakri Widianto said, “It’s not about the size of the budget is, but how much it’s spent.”
Unlike in the textile industry, fewer participants were interested in the proposed program for the footwear and leather industries and sugar mills, Ansari said.
He elaborated that these companies had been reluctant to join last year’s program due to market uncertainties caused by the continuing negative impacts of the global financial crisis.
He also said the ministry had to remove the Scheme Two component of the program due to the lack of response from producers despite the fact that the program had been implemented three years running.
There are two schemes in the textile machinery revitalizing program. Under Scheme One, the government provides 10 percent discounts for manufacturers who want to purchase new machines, while Scheme Two is aimed at small and medium enterprises and provides soft loans.
“Apparently, the number of applicants under Scheme Two was very low, while on the manpower side it took a lot of work to do the administration,” said Ansari.
Secretary of directorate general for small and medium industries Andang Fatati Nadya said her office had begun this year to include the textile, footwear and leather industries in its discount program.
“We will give 25 percent discount for every machine purchased overseas and 30 percent discount for every machine purchased locally,” she said. The machines should be worth between Rp 40 million and Rp 2 billion each, she said.
In addition, the director for the textile industry Arryanto Sagala said there were reportedly four participants under Scheme Two in 2007 and two in 2008 who could not pay their debts on their soft loans. This may have discouraged borrowers.
Landslide kills three in Sumatra
Three people were killed and eight others injured after a landslide hit Saok Laweh, Solok regency, West Sumatra on Wednesday.
West Sumatra disaster management coordinator Ade Edward said the landslide occurred at 6:30 a.m., destroying three homes and an auto repair shop near Jl. Solok, just four kilometers from Muara Kalaban, Sawahlunto.
“This disaster is related to the behavior of the local people, who build homes near the ravine," he said
West Sumatra disaster management coordinator Ade Edward said the landslide occurred at 6:30 a.m., destroying three homes and an auto repair shop near Jl. Solok, just four kilometers from Muara Kalaban, Sawahlunto.
“This disaster is related to the behavior of the local people, who build homes near the ravine," he said
Lightning kills four, injures three in South Sulawesi
Lightning has killed four people and severely injured three others in Lakeppang, Bone, South Sulawesi.
Darwis, a local leader said the victims, all farmers, were taking a lunch break in a small hut located in a rice field amid heavy rain when lightning struck the hut Tuesday evening, Antara state news agency reported.
Four farmers died instantly and while the other three suffered severe burns.
The injured were immediately rushed to Watampone Regional General Hospital, while the deceased victims were sent to their respective homes.
Those killed were identified as M Ali (55), Alimuddin (37), Sumiati (35) and Ayis Sautra (3), while those injured were Akmal (18), Sanating (50) and Agus (24).
Last month, lightning killed five people and seriously injured another as it struck a hut near a rice field in Kampuang Caniago village in the West Sumatra regency of Agam.
Darwis, a local leader said the victims, all farmers, were taking a lunch break in a small hut located in a rice field amid heavy rain when lightning struck the hut Tuesday evening, Antara state news agency reported.
Four farmers died instantly and while the other three suffered severe burns.
The injured were immediately rushed to Watampone Regional General Hospital, while the deceased victims were sent to their respective homes.
Those killed were identified as M Ali (55), Alimuddin (37), Sumiati (35) and Ayis Sautra (3), while those injured were Akmal (18), Sanating (50) and Agus (24).
Last month, lightning killed five people and seriously injured another as it struck a hut near a rice field in Kampuang Caniago village in the West Sumatra regency of Agam.
Selasa, 16 Maret 2010
Oil and gas producers need 3 years for adjustment
Oil and gas industry will need up to three years to adjust to the new environmental law, upstream regulator BPMigas said.
The 2009 Environmental Law stipulates strict environmental standards which include several requirements such as the maximum temperature and degree of impurities in liquid waste.
“We need to find new equipment and technology to adjust to these environmental standards. This will require between two to three years,” BPMigas chairman R. Priyono said over the weekend.
The environmental law took effect since October last year. The implementing regulations giving details on the environmental standards will reportedly be issued by April this year.
Priyono said the law would also impact upon major oil and gas projects in Indonesia. He cited the example of the regulation requiring companies to lower the temperature of liquid waste from 45 degrees Celcius to 40 degrees Celcius, which will have a major impact on the operations of PT Chevron Pacific Indonesia (CPI) in Duri, Sumatra.
“CPI uses massive steam flood. It needs to boil water to produce the steam. If the waste water temperature is too restrictive, then the steam cannot [easily] be produced and used,” he said.
Another example is the Conoco Phillips operation in Belanak field, Natuna. Priyono said the field’s crude contains a high degree of mercury and limiting the average mercury concentration at 40 parts per million (ppm), as required by the law, will require the company to redesign its facility.
“The crude refinery is not available in Indonesia. It’s available among other options in Thailand. If the standards are implemented, the field’s production will decrease by between 28,000 to 40,000 barrels oil per day [bopd],” Priyono said.
Decreasing production due to the new law has been signaled by several other oil and gas contractors earlier. CPI said its production might drop by 248,000 bopd.
PT Pertamina EP, a subsidiary of state oil and gas company PT Pertamina, said its production might drop by 61,000 bopd.
Priyono said the national production would decrease by about 50 percent of total production. The state budget set national oil production at 965,000 barrels per day (bpd). But as of March this year, total oil production had only reached 954,000 bpd.
The 2009 Environmental Law stipulates strict environmental standards which include several requirements such as the maximum temperature and degree of impurities in liquid waste.
“We need to find new equipment and technology to adjust to these environmental standards. This will require between two to three years,” BPMigas chairman R. Priyono said over the weekend.
The environmental law took effect since October last year. The implementing regulations giving details on the environmental standards will reportedly be issued by April this year.
Priyono said the law would also impact upon major oil and gas projects in Indonesia. He cited the example of the regulation requiring companies to lower the temperature of liquid waste from 45 degrees Celcius to 40 degrees Celcius, which will have a major impact on the operations of PT Chevron Pacific Indonesia (CPI) in Duri, Sumatra.
“CPI uses massive steam flood. It needs to boil water to produce the steam. If the waste water temperature is too restrictive, then the steam cannot [easily] be produced and used,” he said.
Another example is the Conoco Phillips operation in Belanak field, Natuna. Priyono said the field’s crude contains a high degree of mercury and limiting the average mercury concentration at 40 parts per million (ppm), as required by the law, will require the company to redesign its facility.
“The crude refinery is not available in Indonesia. It’s available among other options in Thailand. If the standards are implemented, the field’s production will decrease by between 28,000 to 40,000 barrels oil per day [bopd],” Priyono said.
Decreasing production due to the new law has been signaled by several other oil and gas contractors earlier. CPI said its production might drop by 248,000 bopd.
PT Pertamina EP, a subsidiary of state oil and gas company PT Pertamina, said its production might drop by 61,000 bopd.
Priyono said the national production would decrease by about 50 percent of total production. The state budget set national oil production at 965,000 barrels per day (bpd). But as of March this year, total oil production had only reached 954,000 bpd.
Govt promises to solve supply shortage
Minister of State Enterprises Mustafa Abubakar has promised to help solve the acute gas supply shortage being suffered by state gas distributor PT Perusahaan Gas Negara (PGN).
“We will meet with PGN’s president director on Wednesday or Thursday to find the best solution in dealing with the gas supply shortage,” Mustafa said at his office on Friday in response to PGN’s plan to reduce its gas supply to ceramic producers by 20 percent.
Mustafa said that the government should be able to provide a solution to ensure the state gas distributor would be able to meet the gas needs of its customers especially labor intensive manufacturing industries.
“The cut in the supply to industries should be avoided in order to prevent layoffs,” he said.
PGN’s president director Hendi Prio Santoso said last week that the gas shortage was mainly because a big portion of existing domestic gas supply had been diverted to local power plants, but this also reflected wider problems with LNG exports.
He estimated the gas shortage had reached about 297 million standard cubic feet per day (MMSCFD).
Hendi said that PGN planned to import liquefied natural gas (LNG) from Qatar to cope with the supply shortage problem. But the import plan would not be able to immediately solve the problem because it would take years to implement it.
PGN with its partners plan to build two floating LNG terminals off Banten, West Java and off North Sumatra to store part of the LNG to be imported from Qatar.
The construction of the terminal facilities will take at least two years.
Mustafa said it would not be a problem if PGN decided to import gas to solve the supply problem.
“There is no problem with the import option,” the minister said.
Industry Minister M.S. Hidayat also said last week he hoped PGN would not cut the gas supply because the government had promised to divert the larger part of the gas supply from Chevron to PGN for manufacturing industry.
According to the Indonesian Ceramics Industry Association (Asaki), its members are only able to get between 20 and 40 percent of their total demand for gas supply which is up to about 1.88 billion standard cubic feet per day.
Ceramics is among the manufacturing industries that have been hard hit by the acute shortage of natural gas.
Gas is largely used by manufacturers of ceramics, float glass, textiles and chemical products such as rubber gloves as well as by manufacturers of steel-based products, base metal and cement.
Asaki and others have reported that one manufacturer after another has been forced to shut down because of gas shortages.
Indonesia’s gas consumption surged 11.5 percent in 2008, outstripping the rate of growth of gas production, which only reached only 2.7 percent.
Besides the manufacturing sector, gas shortages also hurt the power sector. State power firm PT PLN’s primary energy director Nur Pamudji previously said PLN was short of gas, up to as much as 235 million British thermal units per day (BTUD) in Jakarta, 150 million BTUD in Central Java, and 90 million BTUD in East Java.
Outside Java, the big shortage is in North Sumatra, where PLN needs another 150 million BTUD of gas.
PLN is working to convert its fuel-fired power plants to gas-fired power plants in a bid to cut the cost of the government fuel subsidy.
“We will meet with PGN’s president director on Wednesday or Thursday to find the best solution in dealing with the gas supply shortage,” Mustafa said at his office on Friday in response to PGN’s plan to reduce its gas supply to ceramic producers by 20 percent.
Mustafa said that the government should be able to provide a solution to ensure the state gas distributor would be able to meet the gas needs of its customers especially labor intensive manufacturing industries.
“The cut in the supply to industries should be avoided in order to prevent layoffs,” he said.
PGN’s president director Hendi Prio Santoso said last week that the gas shortage was mainly because a big portion of existing domestic gas supply had been diverted to local power plants, but this also reflected wider problems with LNG exports.
He estimated the gas shortage had reached about 297 million standard cubic feet per day (MMSCFD).
Hendi said that PGN planned to import liquefied natural gas (LNG) from Qatar to cope with the supply shortage problem. But the import plan would not be able to immediately solve the problem because it would take years to implement it.
PGN with its partners plan to build two floating LNG terminals off Banten, West Java and off North Sumatra to store part of the LNG to be imported from Qatar.
The construction of the terminal facilities will take at least two years.
Mustafa said it would not be a problem if PGN decided to import gas to solve the supply problem.
“There is no problem with the import option,” the minister said.
Industry Minister M.S. Hidayat also said last week he hoped PGN would not cut the gas supply because the government had promised to divert the larger part of the gas supply from Chevron to PGN for manufacturing industry.
According to the Indonesian Ceramics Industry Association (Asaki), its members are only able to get between 20 and 40 percent of their total demand for gas supply which is up to about 1.88 billion standard cubic feet per day.
Ceramics is among the manufacturing industries that have been hard hit by the acute shortage of natural gas.
Gas is largely used by manufacturers of ceramics, float glass, textiles and chemical products such as rubber gloves as well as by manufacturers of steel-based products, base metal and cement.
Asaki and others have reported that one manufacturer after another has been forced to shut down because of gas shortages.
Indonesia’s gas consumption surged 11.5 percent in 2008, outstripping the rate of growth of gas production, which only reached only 2.7 percent.
Besides the manufacturing sector, gas shortages also hurt the power sector. State power firm PT PLN’s primary energy director Nur Pamudji previously said PLN was short of gas, up to as much as 235 million British thermal units per day (BTUD) in Jakarta, 150 million BTUD in Central Java, and 90 million BTUD in East Java.
Outside Java, the big shortage is in North Sumatra, where PLN needs another 150 million BTUD of gas.
PLN is working to convert its fuel-fired power plants to gas-fired power plants in a bid to cut the cost of the government fuel subsidy.
SBY asked to find names for BI chief
The government should name candidates to fill the vacant post of Bank Indonesia’s governor as well as those nominated to replace deputy governor Siti Ch. Fadjrijah, banking analysts have said.
“It should be the main priority to immediately name the central bank’s new governor,”
BNI Chief Economist A. Tony Prasetiantono said Sunday. “I think it’s better to have a governor and not to have a senior deputy governor, instead of having a senior deputy governor but not having a governor.”
Presidential spokesman Julian Aldrin Pasha said earlier this month Yudhoyono was selecting the names of BI governor candidates. But he refused to mention names.
There has been speculation that BI Senior Deputy Governor Darmin Nasution may be named as a candidate for BI governor. But this will leave a vacant post for senior deputy governor position due to the law. If the President names Darmin as candidate for BI governor, his position could not be filled immediately. Article 41 in the 2004 law on BI stipulates that the replacement of members of the BI board of governors is limited to a maximum of two positions annually.
Former BI governor Boediono left his position in May 2009 to run as the Vice President.
President Susilo Bambang Yudhoyono recently submitted three names as possible replacements for BI Deputy Governor Siti Ch. Fadjrijah, to be chosen by the House of Representatives in early April.
The three names are Halim Alamsyah, director of banking research and regulation at BI; Perry Warjiyo, director of monetary policy research at BI; and Krisna Wijaya, a commissioner at Bank Danamon, who is the only non-BI candidate.
Halim or Krisna seem to be the stronger ones to replace Fadjrijah, who was in charge of banking supervision before she fell ill in the midst of the Bank Century collapse.
BI’s banking supervision has been widely criticized following the Century collapse in November 2008, which cost the Deposit Insurance Corporation Rp 6.76 trillion (US$716 million), to finance the government-approved bailout.
“The empty post is [banking] supervision and BI just had the Century ‘storm’, so in my opinion the post is more suitably given to a commercial banker who could more rapidly detect misappropriation in a commercial bank,” Tony said.
“So Krisna is more suitable. Perry and Halim I suspect will fill the next expired positions in the board of governors,” he said.
BI spokesman Dify Johansyah said in 2012 BI Deputy Governor Muliaman D. Hadad and BI Deputy Governor Budi Mulya would end their terms.
But Dify dismissed speculation that Krisna or Halim would be the strongest candidates. “The appointed candidate isn’t automatically in charge of banking supervision. It can be rotated based on the workload of the board of governors,” he said, adding that BI Deputy Governor Budi Rochadi has taken over banking supervision prior to Fadjrijah’s illness.
Perry himself said he would review regulatory compliance at BI, which he said could be strengthened. “[There needs to be] improvement, structure and efficiency [of regulatory compliance],” he said.
More challenges will be faced by the appointed candidate, said Tony, particularly after the establishment of the Financial Services Authority (OJK) at the latest by the end of this year, as stated by the law on BI. The OJK will supervise the whole financial sector.
Lawmaker Akhsanul Qosasih, vice chairman of the House’s commission XI which oversees financial affairs and which will test the BI deputy governor candidates, said the assessment of Halim would be troubled by the Century case.
Krisna in 2005 was also nominated as BI deputy governor candidate, but the House chose Fadjrijah
over him.
Obama's Asia trip more about influence than policy
President Barack Obama's second trip to Asia since taking office is unlikely to result in tangible accomplishments, but the two-country sojourn could be an important step in restoring U.S. influence in the region.
The economy, terrorism and climate change all figure to play prominently in Obama's stops in Indonesia, the world's most populous Muslim nation, and Australia, a key U.S. ally and supporter of American military efforts in Afghanistan.
Obama is the first U.S. president in at least a decade to travel to Southeast Asia for anything other than a regional summit, a move administration officials say reflects his efforts to strengthen relationships with smaller, emerging nations.
"There are a number of important middle powers, countries like Australia and Indonesia who are significant players," said Jeff Bader, the president's senior adviser for Asia.
As the president prepares to undertake his first international trip of the year, scheduled for Sunday, domestic politics have threatened to overshadow his foreign policy goals.
The ongoing debate on health care reform forced Obama to push back his original Thursday departure by three days so he could stay in Washington and help Democrats in Congress rally last-minute votes for his overhaul plan.
The change in itinerary also meant first lady Michelle Obama and daughters Malia and Sasha would no longer accompany the president abroad, despite the fact that the trip had been scheduled to coincide with the girls' spring break from school.
Obama had hoped to show his family his boyhood haunts in Indonesia, where he spent four years after his mother married an Indonesian man. A bronze statue of a 10-year-old Obama was recently erected at the elementary school he attended.
During his two-day stop in Jakarta, Obama will meet with Indonesian President Susilo Bambang Yudhoyono. In a separate appearance, he'll deliver his first address to the Muslim world since his historic speech in Cairo last year.
Obama will also spend a day in Bali, a well-known tourist destination that has been struck by deadly terrorist attacks. There he will meet with civil society leaders and hold an event promoting the role civil society has played in Indonesia's emerging democracy.
The president's itinerary in Australia has been scaled back due to the delay in his departure. He'll no longer visit Sydney, where his family was expected to do some sightseeing, and instead stop only in Australia's capital, Canberra.
He will meet with Prim Minister Kevin Rudd, with whom he shares a close relationship on the issues of climate change and the war in Afghanistan.
Obama will address Australia's parliament and mark the 70th anniversary of relations between the U.S. and Australia.
In some parts of Asia, the most carefully watched stop of Obamas trip will be the first, and the shortest - a speech he'll make to U.S. service members stationed in Guam while his plane refuels before heading to Indonesia.
The tiny U.S. Pacific territory is at the center of a growing rift between Washington and Japan. Under a post-World War II pact, the U.S. has about 50,000 troops in Japan, most of whom are on the island of Okinawa. Both countries had agreed to close the sprawling Marine Corps Air Station Futenma and relocate 8,000 Marines to Guam.
While Tokyo's previous administration agreed to build a replacement for Futenma farther north on a less-populated part of kinawa, Japan's new coalition government is divided over whether a base should remain in Japan at all. The U.S. says the transfer of Marines to Guam cannot move forward until the new site on Okinawa is finalized.
The economy, terrorism and climate change all figure to play prominently in Obama's stops in Indonesia, the world's most populous Muslim nation, and Australia, a key U.S. ally and supporter of American military efforts in Afghanistan.
Obama is the first U.S. president in at least a decade to travel to Southeast Asia for anything other than a regional summit, a move administration officials say reflects his efforts to strengthen relationships with smaller, emerging nations.
"There are a number of important middle powers, countries like Australia and Indonesia who are significant players," said Jeff Bader, the president's senior adviser for Asia.
As the president prepares to undertake his first international trip of the year, scheduled for Sunday, domestic politics have threatened to overshadow his foreign policy goals.
The ongoing debate on health care reform forced Obama to push back his original Thursday departure by three days so he could stay in Washington and help Democrats in Congress rally last-minute votes for his overhaul plan.
The change in itinerary also meant first lady Michelle Obama and daughters Malia and Sasha would no longer accompany the president abroad, despite the fact that the trip had been scheduled to coincide with the girls' spring break from school.
Obama had hoped to show his family his boyhood haunts in Indonesia, where he spent four years after his mother married an Indonesian man. A bronze statue of a 10-year-old Obama was recently erected at the elementary school he attended.
During his two-day stop in Jakarta, Obama will meet with Indonesian President Susilo Bambang Yudhoyono. In a separate appearance, he'll deliver his first address to the Muslim world since his historic speech in Cairo last year.
Obama will also spend a day in Bali, a well-known tourist destination that has been struck by deadly terrorist attacks. There he will meet with civil society leaders and hold an event promoting the role civil society has played in Indonesia's emerging democracy.
The president's itinerary in Australia has been scaled back due to the delay in his departure. He'll no longer visit Sydney, where his family was expected to do some sightseeing, and instead stop only in Australia's capital, Canberra.
He will meet with Prim Minister Kevin Rudd, with whom he shares a close relationship on the issues of climate change and the war in Afghanistan.
Obama will address Australia's parliament and mark the 70th anniversary of relations between the U.S. and Australia.
In some parts of Asia, the most carefully watched stop of Obamas trip will be the first, and the shortest - a speech he'll make to U.S. service members stationed in Guam while his plane refuels before heading to Indonesia.
The tiny U.S. Pacific territory is at the center of a growing rift between Washington and Japan. Under a post-World War II pact, the U.S. has about 50,000 troops in Japan, most of whom are on the island of Okinawa. Both countries had agreed to close the sprawling Marine Corps Air Station Futenma and relocate 8,000 Marines to Guam.
While Tokyo's previous administration agreed to build a replacement for Futenma farther north on a less-populated part of kinawa, Japan's new coalition government is divided over whether a base should remain in Japan at all. The U.S. says the transfer of Marines to Guam cannot move forward until the new site on Okinawa is finalized.
Some Toyota drivers suing in US for a full refund
A group of Toyota owners sued the Japanese automaker Monday, demanding a full refund for their recalled cars and seeking a payout that could exceed several billion dollars.
Dozens of Toyota owners in Arizona and Washington claim the vehicles recalled over incidents of sudden acceleration are so unsafe they should be able to return them immediately. Attorney Steve Berman said many of the owners no longer trust their vehicles.
"When we talked with Toyota owners, they all voiced the same desire - to drive the car back to the lot, hand them the keys and pick up a check," said Berman, who is based in Seattle. "Fortunately, we think the law allows for exactly that solution, and we are asking the courts to make it happen."
The new lawsuits seek class-action status, which if expanded nationwide, could mean a settlement covering about 6 million recalled Toyotas in the U.S.
Dozens of other potential class-action lawsuits have also been filed against Toyota since it began recalling millions of vehicles to fix floor mats the company says can snag on the accelerator in some models and gas pedals that can get stuck in others. Critics and lawsuits contend the real problem is Toyota's electronic throttle control, which the company has denied.
Most of the lawsuits contend the recalls have triggered a significant drop in the value of Toyotas - between 6 percent and 15 percent, according to the Kelley Blue Book used-car manual - and are seeking a cash payment for owners to compensate for that loss. Lawyers involved in those cases have estimated Toyota could have to cough up more than $3 billion, assuming a conservative $500-per-owner payment.
The full refund cases take it a step further.
"I don't know of any parent who would be willing to put their kids in a potentially unsafe car in exchange for a few hundred bucks," Berman said.
A Toyota spokesman did not immediately return a telephone call seeking comment. Generally, the company has refused to comment on the lawsuits.
Matt Cairns, a private attorney and member a group of lawyers that represents corporations and individuals, said he didn't think the Toyota owners should be entitled to full refunds.
"If they prevail, such plainiffs will effectively have received free transportation for the period of their ownership of a car that met their every need, something all of us would appreciate when we decide we want a new ride," said Cairns, who is the president-elect of The Voice of the Defense Bar.
Cairns said Toyota owners who selltheir cars may be able to get compensation for a loss in the vehicle's value following the recall.
The full refund lawsuits come a week before a panel of federal judges will hold a hearing in San Diego on whether to consolidate more than 110 potential Toyota class-action cases before a single judge. The juge would decide whether the cases can be combined into a single "class" of affected Toyota owners and whether the case should proceed to trial.
A group of attorneys filing Toyota cases nationwide - known as the Attorneys Toyota Action Consortium, or ATAC - announced Monday they are adding racketeering clims to many of their lawsuits. The attorney coordinating the effort, Northeastern University law professor Tim Howard, said Toyota has known of accelerator problems since at least 2000 and engaged in a "conspiracy to hide the truth" from consumers.
"It's become increasingly apparent that Toyota profitsere not built on quality products, but on a willful pattern of deception, fraud and racketeering," Howard said.
If fraud claims are successful under the federal Racketeering Influenced and Corrupt Organizations or RICO law, Howard said, it could push total Toyota class-action damages above $10 billion.
Claims of fraud and deception have been made against Toyota in previous lawsuits, including one filed in California in July 2009 by a former Toyota employee. The newer lawsuits are based in part on documents obtained by investigative reporters and congressional committees looking into the company's recalls.
Dozens of Toyota owners in Arizona and Washington claim the vehicles recalled over incidents of sudden acceleration are so unsafe they should be able to return them immediately. Attorney Steve Berman said many of the owners no longer trust their vehicles.
"When we talked with Toyota owners, they all voiced the same desire - to drive the car back to the lot, hand them the keys and pick up a check," said Berman, who is based in Seattle. "Fortunately, we think the law allows for exactly that solution, and we are asking the courts to make it happen."
The new lawsuits seek class-action status, which if expanded nationwide, could mean a settlement covering about 6 million recalled Toyotas in the U.S.
Dozens of other potential class-action lawsuits have also been filed against Toyota since it began recalling millions of vehicles to fix floor mats the company says can snag on the accelerator in some models and gas pedals that can get stuck in others. Critics and lawsuits contend the real problem is Toyota's electronic throttle control, which the company has denied.
Most of the lawsuits contend the recalls have triggered a significant drop in the value of Toyotas - between 6 percent and 15 percent, according to the Kelley Blue Book used-car manual - and are seeking a cash payment for owners to compensate for that loss. Lawyers involved in those cases have estimated Toyota could have to cough up more than $3 billion, assuming a conservative $500-per-owner payment.
The full refund cases take it a step further.
"I don't know of any parent who would be willing to put their kids in a potentially unsafe car in exchange for a few hundred bucks," Berman said.
A Toyota spokesman did not immediately return a telephone call seeking comment. Generally, the company has refused to comment on the lawsuits.
Matt Cairns, a private attorney and member a group of lawyers that represents corporations and individuals, said he didn't think the Toyota owners should be entitled to full refunds.
"If they prevail, such plainiffs will effectively have received free transportation for the period of their ownership of a car that met their every need, something all of us would appreciate when we decide we want a new ride," said Cairns, who is the president-elect of The Voice of the Defense Bar.
Cairns said Toyota owners who selltheir cars may be able to get compensation for a loss in the vehicle's value following the recall.
The full refund lawsuits come a week before a panel of federal judges will hold a hearing in San Diego on whether to consolidate more than 110 potential Toyota class-action cases before a single judge. The juge would decide whether the cases can be combined into a single "class" of affected Toyota owners and whether the case should proceed to trial.
A group of attorneys filing Toyota cases nationwide - known as the Attorneys Toyota Action Consortium, or ATAC - announced Monday they are adding racketeering clims to many of their lawsuits. The attorney coordinating the effort, Northeastern University law professor Tim Howard, said Toyota has known of accelerator problems since at least 2000 and engaged in a "conspiracy to hide the truth" from consumers.
"It's become increasingly apparent that Toyota profitsere not built on quality products, but on a willful pattern of deception, fraud and racketeering," Howard said.
If fraud claims are successful under the federal Racketeering Influenced and Corrupt Organizations or RICO law, Howard said, it could push total Toyota class-action damages above $10 billion.
Claims of fraud and deception have been made against Toyota in previous lawsuits, including one filed in California in July 2009 by a former Toyota employee. The newer lawsuits are based in part on documents obtained by investigative reporters and congressional committees looking into the company's recalls.
Some Toyota drivers suing in US for a full refund
A group of Toyota owners sued the Japanese automaker Monday, demanding a full refund for their recalled cars and seeking a payout that could exceed several billion dollars.
Dozens of Toyota owners in Arizona and Washington claim the vehicles recalled over incidents of sudden acceleration are so unsafe they should be able to return them immediately. Attorney Steve Berman said many of the owners no longer trust their vehicles.
"When we talked with Toyota owners, they all voiced the same desire - to drive the car back to the lot, hand them the keys and pick up a check," said Berman, who is based in Seattle. "Fortunately, we think the law allows for exactly that solution, and we are asking the courts to make it happen."
The new lawsuits seek class-action status, which if expanded nationwide, could mean a settlement covering about 6 million recalled Toyotas in the U.S.
Dozens of other potential class-action lawsuits have also been filed against Toyota since it began recalling millions of vehicles to fix floor mats the company says can snag on the accelerator in some models and gas pedals that can get stuck in others. Critics and lawsuits contend the real problem is Toyota's electronic throttle control, which the company has denied.
Most of the lawsuits contend the recalls have triggered a significant drop in the value of Toyotas - between 6 percent and 15 percent, according to the Kelley Blue Book used-car manual - and are seeking a cash payment for owners to compensate for that loss. Lawyers involved in those cases have estimated Toyota could have to cough up more than $3 billion, assuming a conservative $500-per-owner payment.
The full refund cases take it a step further.
"I don't know of any parent who would be willing to put their kids in a potentially unsafe car in exchange for a few hundred bucks," Berman said.
A Toyota spokesman did not immediately return a telephone call seeking comment. Generally, the company has refused to comment on the lawsuits.
Matt Cairns, a private attorney and member a group of lawyers that represents corporations and individuals, said he didn't think the Toyota owners should be entitled to full refunds.
"If they prevail, such plainiffs will effectively have received free transportation for the period of their ownership of a car that met their every need, something all of us would appreciate when we decide we want a new ride," said Cairns, who is the president-elect of The Voice of the Defense Bar.
Cairns said Toyota owners who selltheir cars may be able to get compensation for a loss in the vehicle's value following the recall.
The full refund lawsuits come a week before a panel of federal judges will hold a hearing in San Diego on whether to consolidate more than 110 potential Toyota class-action cases before a single judge. The juge would decide whether the cases can be combined into a single "class" of affected Toyota owners and whether the case should proceed to trial.
A group of attorneys filing Toyota cases nationwide - known as the Attorneys Toyota Action Consortium, or ATAC - announced Monday they are adding racketeering clims to many of their lawsuits. The attorney coordinating the effort, Northeastern University law professor Tim Howard, said Toyota has known of accelerator problems since at least 2000 and engaged in a "conspiracy to hide the truth" from consumers.
"It's become increasingly apparent that Toyota profitsere not built on quality products, but on a willful pattern of deception, fraud and racketeering," Howard said.
If fraud claims are successful under the federal Racketeering Influenced and Corrupt Organizations or RICO law, Howard said, it could push total Toyota class-action damages above $10 billion.
Claims of fraud and deception have been made against Toyota in previous lawsuits, including one filed in California in July 2009 by a former Toyota employee. The newer lawsuits are based in part on documents obtained by investigative reporters and congressional committees looking into the company's recalls.
Dozens of Toyota owners in Arizona and Washington claim the vehicles recalled over incidents of sudden acceleration are so unsafe they should be able to return them immediately. Attorney Steve Berman said many of the owners no longer trust their vehicles.
"When we talked with Toyota owners, they all voiced the same desire - to drive the car back to the lot, hand them the keys and pick up a check," said Berman, who is based in Seattle. "Fortunately, we think the law allows for exactly that solution, and we are asking the courts to make it happen."
The new lawsuits seek class-action status, which if expanded nationwide, could mean a settlement covering about 6 million recalled Toyotas in the U.S.
Dozens of other potential class-action lawsuits have also been filed against Toyota since it began recalling millions of vehicles to fix floor mats the company says can snag on the accelerator in some models and gas pedals that can get stuck in others. Critics and lawsuits contend the real problem is Toyota's electronic throttle control, which the company has denied.
Most of the lawsuits contend the recalls have triggered a significant drop in the value of Toyotas - between 6 percent and 15 percent, according to the Kelley Blue Book used-car manual - and are seeking a cash payment for owners to compensate for that loss. Lawyers involved in those cases have estimated Toyota could have to cough up more than $3 billion, assuming a conservative $500-per-owner payment.
The full refund cases take it a step further.
"I don't know of any parent who would be willing to put their kids in a potentially unsafe car in exchange for a few hundred bucks," Berman said.
A Toyota spokesman did not immediately return a telephone call seeking comment. Generally, the company has refused to comment on the lawsuits.
Matt Cairns, a private attorney and member a group of lawyers that represents corporations and individuals, said he didn't think the Toyota owners should be entitled to full refunds.
"If they prevail, such plainiffs will effectively have received free transportation for the period of their ownership of a car that met their every need, something all of us would appreciate when we decide we want a new ride," said Cairns, who is the president-elect of The Voice of the Defense Bar.
Cairns said Toyota owners who selltheir cars may be able to get compensation for a loss in the vehicle's value following the recall.
The full refund lawsuits come a week before a panel of federal judges will hold a hearing in San Diego on whether to consolidate more than 110 potential Toyota class-action cases before a single judge. The juge would decide whether the cases can be combined into a single "class" of affected Toyota owners and whether the case should proceed to trial.
A group of attorneys filing Toyota cases nationwide - known as the Attorneys Toyota Action Consortium, or ATAC - announced Monday they are adding racketeering clims to many of their lawsuits. The attorney coordinating the effort, Northeastern University law professor Tim Howard, said Toyota has known of accelerator problems since at least 2000 and engaged in a "conspiracy to hide the truth" from consumers.
"It's become increasingly apparent that Toyota profitsere not built on quality products, but on a willful pattern of deception, fraud and racketeering," Howard said.
If fraud claims are successful under the federal Racketeering Influenced and Corrupt Organizations or RICO law, Howard said, it could push total Toyota class-action damages above $10 billion.
Claims of fraud and deception have been made against Toyota in previous lawsuits, including one filed in California in July 2009 by a former Toyota employee. The newer lawsuits are based in part on documents obtained by investigative reporters and congressional committees looking into the company's recalls.
Kamis, 11 Maret 2010
BankPermata issues Rp 700 billion notes
AKARTA: PT Bank Permata Tbk (Bank Permata) has issued a 10-year unsecured subordinated Medium Term Note (MTN) worth Rp 700 billion (US$76.3 million) to fund future business expansion, the bank announced Wednesday.
With a coupon at 275 basis points over the 3-month Indonesian SBI, the issuance is priced at par. All notes were purchased by strategic shareholder Standard Chartered Bank.
“This issuance further strengthens BankPermata's balance sheet and gives us even greater flexibility to take advantage of growth opportunities in the Indonesian banking market as they emerge,” BankPermata president director David Fletcher said.
With the issuance of the notes, the bank can maintain an even higher level of capital relative to risk weighted assets, he said. — JP
With a coupon at 275 basis points over the 3-month Indonesian SBI, the issuance is priced at par. All notes were purchased by strategic shareholder Standard Chartered Bank.
“This issuance further strengthens BankPermata's balance sheet and gives us even greater flexibility to take advantage of growth opportunities in the Indonesian banking market as they emerge,” BankPermata president director David Fletcher said.
With the issuance of the notes, the bank can maintain an even higher level of capital relative to risk weighted assets, he said. — JP
BI said to delay single presence rule
The central bank has agreed to postpone the implementation of the single presence policy for two years and may consider exempting state banks indefinitely, the government said.
State-Owned Enterprises Mi-nister Mustafa Abubakar told The Jakarta Post in an interview earlier this week that Bank Indonesia (BI) acting governor Darmin Nasution had given his approval for the postponement of the policy in a meeting that was also attended by Industry Minister Mohamad Suleman Hidayat and two BI directors.
“For the two years postponement, they have agreed. I haven’t received the letter yet, but it has been decided in the meeting,” Mustafa said.
Darmin was not available for comment, but BI spokesperson Difi Johansyah said the central bank had not made a final decision on the matter.
“The decision has to be made in the Board of Governors meeting,” Difi said.
The single presence policy, first introduced in 2006, requires majority shareholders in more than one bank to merge or divest their ownership, or create a holding company, no later than by the end of this year.
The policy resulted in Malaysia’s CIMB Group merging Bank Lippo and Bank Niaga in 2008 to form CIMB Niaga. Singapore’s Temasek Holdings, which currently owns 76 percent of Bank Danamon, also sold a majority stake in BII to comply with the policy.
Mustafa argued that private banks were different in nature and mission in comparison to state banks as the latter were governed by a set of legal provisions uniquely applied to state assets.
“State banks uphold the objectives of the state. They are bound by the Constitution, Article 33 [on national wealth], the 2003 State Enterprise Law and the Corporation Law. With a combination like this, it is legally difficult to give the same treatment to state banks [as for private ones],” he said.
The implementation of the policy on state banks not only implies serious legal complexities, but also a mammoth undertaking in merging state banks with assets among the 10 biggest in the market and thousands of workers, Mustafa said.
The government has a 76 percent share in Bank BNI, 73 percent in BTN, 66 percent in Mandiri and 56 percent in BRI. Based on December 2009 figures, the merger of the four banks would create an entity that would control 39 percent of total assets of commercial banks.
“There will be too much energy wasted at a time when we must go forward and take advantage of the positive momentum in the economy. We cannot go forward fast enough if we have to go through such a massive internal homework,” Mustafa said.
Being granted a postponement was not enough for the government, he said, thus it was proposing for BI to completely exempt state banks from the policy.
“We have sent a formal letter proposing BI to review the policy. The two-year period will allow BI to do that. What we want is full exemption,” Mustafa said, while adding that he was optimistic BI would agree to the request.
State-Owned Enterprises Mi-nister Mustafa Abubakar told The Jakarta Post in an interview earlier this week that Bank Indonesia (BI) acting governor Darmin Nasution had given his approval for the postponement of the policy in a meeting that was also attended by Industry Minister Mohamad Suleman Hidayat and two BI directors.
“For the two years postponement, they have agreed. I haven’t received the letter yet, but it has been decided in the meeting,” Mustafa said.
Darmin was not available for comment, but BI spokesperson Difi Johansyah said the central bank had not made a final decision on the matter.
“The decision has to be made in the Board of Governors meeting,” Difi said.
The single presence policy, first introduced in 2006, requires majority shareholders in more than one bank to merge or divest their ownership, or create a holding company, no later than by the end of this year.
The policy resulted in Malaysia’s CIMB Group merging Bank Lippo and Bank Niaga in 2008 to form CIMB Niaga. Singapore’s Temasek Holdings, which currently owns 76 percent of Bank Danamon, also sold a majority stake in BII to comply with the policy.
Mustafa argued that private banks were different in nature and mission in comparison to state banks as the latter were governed by a set of legal provisions uniquely applied to state assets.
“State banks uphold the objectives of the state. They are bound by the Constitution, Article 33 [on national wealth], the 2003 State Enterprise Law and the Corporation Law. With a combination like this, it is legally difficult to give the same treatment to state banks [as for private ones],” he said.
The implementation of the policy on state banks not only implies serious legal complexities, but also a mammoth undertaking in merging state banks with assets among the 10 biggest in the market and thousands of workers, Mustafa said.
The government has a 76 percent share in Bank BNI, 73 percent in BTN, 66 percent in Mandiri and 56 percent in BRI. Based on December 2009 figures, the merger of the four banks would create an entity that would control 39 percent of total assets of commercial banks.
“There will be too much energy wasted at a time when we must go forward and take advantage of the positive momentum in the economy. We cannot go forward fast enough if we have to go through such a massive internal homework,” Mustafa said.
Being granted a postponement was not enough for the government, he said, thus it was proposing for BI to completely exempt state banks from the policy.
“We have sent a formal letter proposing BI to review the policy. The two-year period will allow BI to do that. What we want is full exemption,” Mustafa said, while adding that he was optimistic BI would agree to the request.
Govt to raise subsidies by 23% to Rp 199.34 trillion
Total subsidies will be raised by 26.3 percent to Rp 199.34 trillion (US$21.73 billion) in the revised 2010 state budget to protect households, the main driver of Indonesia’s economy, the Finance Ministry said.
In the 2010 budget it is estimated total subsidies will reach Rp 157.82 trillion. But they need to be revised in line with a predicted surge in global oil prices, bringing the Indonesia Crude Price (ICP) to $77 per barrel in the revised 2010 budget up from $65 earlier, the ministry said.
Last year total subsidies were set at Rp 157.73 trillion, based on an ICP of $61 per barrel.
Finance Minister Sri Mulyani Indrawati told the foreign media Tuesday night the government would maintain the purchasing power of households to achieve the targeted 5.5 percent economic growth.
“The economy is sustained by household consumption and investment recovery,” she said. Last year the economy grew by 4.5 percent, mainly driven by household consumption, the Central Statistics Agency (BPS) said.
In the revised 2010 budget, the fuel subsidy is to soar by 30 percent to Rp 89.29 trillion, almost double the fuel subsidy of Rp 45.04 trillion in 2009, the Finance Ministry said.
This year’s inflation is estimated to reach 5.7 percent, according to the revised 2010 budget. Inflation may increase in the second half of this year after the government raises the electricity tariff, analysts predict.
Mulyani said the government would raise the electricity tariff in the second half of the year, instead of in January as planned.
The electricity subsidy in the revised 2010 budget rises 44.2 percent to Rp 54.5 trillion because of the crude oil price increase and delayed electricity tariff increase, as well as a carryover of Rp 4 trillion from a delayed 2009 electricity subsidy payment and the increased margin allowed to state power utility PLN up from 5 to 8 percent.
The tariff increase will apply to households and businesses with capacity of above 6,600 VA who use electricity at a rate of more than 50 percent of last year’s average consumption for their category. The fertilizer subsidy is also raised by 30 percent to Rp 19.18 trillion. The plan to raise fertilizer prices has been delayed until April from January.
In the 2010 budget it is estimated total subsidies will reach Rp 157.82 trillion. But they need to be revised in line with a predicted surge in global oil prices, bringing the Indonesia Crude Price (ICP) to $77 per barrel in the revised 2010 budget up from $65 earlier, the ministry said.
Last year total subsidies were set at Rp 157.73 trillion, based on an ICP of $61 per barrel.
Finance Minister Sri Mulyani Indrawati told the foreign media Tuesday night the government would maintain the purchasing power of households to achieve the targeted 5.5 percent economic growth.
“The economy is sustained by household consumption and investment recovery,” she said. Last year the economy grew by 4.5 percent, mainly driven by household consumption, the Central Statistics Agency (BPS) said.
In the revised 2010 budget, the fuel subsidy is to soar by 30 percent to Rp 89.29 trillion, almost double the fuel subsidy of Rp 45.04 trillion in 2009, the Finance Ministry said.
This year’s inflation is estimated to reach 5.7 percent, according to the revised 2010 budget. Inflation may increase in the second half of this year after the government raises the electricity tariff, analysts predict.
Mulyani said the government would raise the electricity tariff in the second half of the year, instead of in January as planned.
The electricity subsidy in the revised 2010 budget rises 44.2 percent to Rp 54.5 trillion because of the crude oil price increase and delayed electricity tariff increase, as well as a carryover of Rp 4 trillion from a delayed 2009 electricity subsidy payment and the increased margin allowed to state power utility PLN up from 5 to 8 percent.
The tariff increase will apply to households and businesses with capacity of above 6,600 VA who use electricity at a rate of more than 50 percent of last year’s average consumption for their category. The fertilizer subsidy is also raised by 30 percent to Rp 19.18 trillion. The plan to raise fertilizer prices has been delayed until April from January.
Asian stocks lower amid spike in China inflation
Asian stock markets were mostly lower Thursday as China's burst of inflation and Japan's weaker growth tempered confidence in the regional economic rebound.
Most markets were modestly higher in the first two hours of trading but reversed course as the latest figures raised doubts about the outlook for major economies.
Oil prices fell below $82 a barrel amid signs of tepid U.S. crude demand and the dollar lost ground against the ye while rising slightly versus the euro.
China's inflation rate jumped to 2.7 percent in February over a year earlier from 1.5 percent in January, adding to pressure on Beijing to prevent overheating without derailing recovery.
Japan, meanwhile, cut its reading of fourth quarter growth to an annualized3.8 percent from the initial estimate of 4.6 percent. That underscored the patchy recovery in the world's No. 2 economy.
In Australia too, there was a break in the recent slew of positive economic news. The jobless rate edged up slightly to 5.3 percent in February, the first rise since peaking at 5.8 percent last October.
Japan's Nikkei 225 stock average was up 88.91 points, or 0.9 percent, to 10,653.70 while Hong Kong's Hang Seng lost 74.07, or 0.4 percent, to 21,134.22.
South Korea's Kospi was off 0.2 percent at 1,659.35 and China's Shanghai benchmark slipped 0.1 percent to 3,047.92.
Elsewhere, Autralia's index fell 0.1 percent and Singapore's market also shed 0.1 percent. India's Sensex added 0.1 percent.
Oil prices were lower in Asia. Benchmark crude for April delivery was down 51 cents to $81.58 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose 60 cents to sette at $82.09 on Wednesday.
In currencies, the dollar fell to 90.37 yen from 90.49 yen. The euro fell to $1.3646 from $1.3654.
Most markets were modestly higher in the first two hours of trading but reversed course as the latest figures raised doubts about the outlook for major economies.
Oil prices fell below $82 a barrel amid signs of tepid U.S. crude demand and the dollar lost ground against the ye while rising slightly versus the euro.
China's inflation rate jumped to 2.7 percent in February over a year earlier from 1.5 percent in January, adding to pressure on Beijing to prevent overheating without derailing recovery.
Japan, meanwhile, cut its reading of fourth quarter growth to an annualized3.8 percent from the initial estimate of 4.6 percent. That underscored the patchy recovery in the world's No. 2 economy.
In Australia too, there was a break in the recent slew of positive economic news. The jobless rate edged up slightly to 5.3 percent in February, the first rise since peaking at 5.8 percent last October.
Japan's Nikkei 225 stock average was up 88.91 points, or 0.9 percent, to 10,653.70 while Hong Kong's Hang Seng lost 74.07, or 0.4 percent, to 21,134.22.
South Korea's Kospi was off 0.2 percent at 1,659.35 and China's Shanghai benchmark slipped 0.1 percent to 3,047.92.
Elsewhere, Autralia's index fell 0.1 percent and Singapore's market also shed 0.1 percent. India's Sensex added 0.1 percent.
Oil prices were lower in Asia. Benchmark crude for April delivery was down 51 cents to $81.58 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose 60 cents to sette at $82.09 on Wednesday.
In currencies, the dollar fell to 90.37 yen from 90.49 yen. The euro fell to $1.3646 from $1.3654.
Seven Indonesian billionaires listed in Forbes
Seven Indonesians joined the 2010 list of the world's billionaires issued by Forbes magazine, with businessman Michael and Budi Hartono sharing the top position in 258th place.
The pair’s wealth stood at US$3.5 billion each, followed by Martua Sitorus in 316th place with a total wealth of $3.0 billion.
Peter Sondakh, with his $2.2 billion, was ranked 437th, while Sukanto Tanoto was in 536th place with a net worth of $1.9 billion.
The last two Indonesian billionaires were Low Tuck Kwong, ranked 828th, and Chairul Tanjung, ranked 937th. Low and Chairul had a fortune of $1.2 billion and $1 billion respectively.
The richest man in the world is Mexican telecom titan Carlos Slim Helu.
The pair’s wealth stood at US$3.5 billion each, followed by Martua Sitorus in 316th place with a total wealth of $3.0 billion.
Peter Sondakh, with his $2.2 billion, was ranked 437th, while Sukanto Tanoto was in 536th place with a net worth of $1.9 billion.
The last two Indonesian billionaires were Low Tuck Kwong, ranked 828th, and Chairul Tanjung, ranked 937th. Low and Chairul had a fortune of $1.2 billion and $1 billion respectively.
The richest man in the world is Mexican telecom titan Carlos Slim Helu.
Subsidized fuel price likely to increase
The government may raise the price of subsidized fuels if the benchmark Indonesian Crude Price (ICP) soars above US$84.7 per barrel this year, according to the proposed revised 2010 state budget.
"Under an estimate, if the average Indonesian Crude Price in one year has an increase of more than 10 percent than the assumed price in the revised 2010 state budget, the government is authorized to adjust the price of subsidized fuels," Article 7 in the proposed 2010 budget said.
In the proposed budget, the ICP has been raised to $77 per barrel from $65 stated in the initial 2010 budget.
The government has yet to make a comment on this issue.
"Under an estimate, if the average Indonesian Crude Price in one year has an increase of more than 10 percent than the assumed price in the revised 2010 state budget, the government is authorized to adjust the price of subsidized fuels," Article 7 in the proposed 2010 budget said.
In the proposed budget, the ICP has been raised to $77 per barrel from $65 stated in the initial 2010 budget.
The government has yet to make a comment on this issue.
Minggu, 07 Februari 2010
Cabinet reshuffle buzz: Truth or dare?
Politicians and observers apparently are talking about something this weekend: Is the cabinet reshuffle proposal from the Democratic Party a bluff or a real threat?
Earlier on Thursday, three Democratic Party executives, Amir Syamsuddin, Anas Urbaningrum and Jafar Hafsah, met with President Susilo Bambang Yudhoyono, proposing the latter to replace ministers from disloyal coalition partners, which the three said had refused to defend the government in the investigation of the Bank Century bailout case.
The parties are the Golkar Party, the Prosperous Justice Party (PKS), the National Mandate Party (PAN), the United Development Party (PPP) and the National Awakening Party (PKB).
The ministers from coalition parties include Communications and Information Technology Minister Tifatul Sembiring (PKS), Religious Affairs Minister Suryadharma Ali (PPP), Agriculture Minister Suswono (PKS), Maritime Affairs and Fisheries Minister Fadel Muhammad (Golkar), Manpower and Transmigration Minister Muhaimin Iskandar (PKB).
But presidential spokesman Julian Aldrin Pasha said the President had not given a response to the proposal.
Yudhoyono’s rivals in the July 8 presidential election, former president Megawati Soekarnoputri of the opposition Indonesian Democratic Party of Struggle (PDI-P) and former vice president Jusuf Kalla of Golkar, said over the weekend it was the President’s right to decide a reshuffle.
“That’s the President’s business. If he considers it important, that is good,” Megawati said while opening the regional conference of the PDI-P in Bali.
A PDI-P lawmaker told The Jakarta Post that the Democratic Party had approached Megawati, opening four possible positions for the opposition to fill.
Kalla, meanwhile, said that he was ready to see Golkar cadres replaced or retained.
Several critics aired their opinions Saturday, saying that the proposal is a bluff to make coalitionparties gather their acts together.
“In political communication theory, this is called a ‘fear-arising communication’ model, which in practice has never succeeded,” political observer Tjipta Lesmana told a discussion in Jakarta, Antara news agency reported. “This model has proven to be ineffective. The more pressure applied, the harder partners defy.”
University of Indonesia political observer Arbi Sanit said Golkar and PKS were the main targets of the reshuffle “threat”, with their being “most critical” among coalition members during questioning sessions of the inquiry committee. The inquiry committee has summoned both Vice President Boediono and Finance Minister Sri Mulyani Indrawati to explain the decision behind the Rp 6.76 trillion (US$716 million) bailout of the ailing bank. Some of the lawmakers launched harsh questions to the Vice President and the minister and others said in public that they believed Boediono should be impeached.
He predicted that in response to the threat, Golkar and the PKS would seek to negotiate with the Democratic Party, a move that could lead to a vague conclusion to the committee’s hearing.
Democratic Party lawmaker Ramadhan Pohan said his party did not press the coalition partners, but to the contrary, the partners were pressing his.
He said the proposal for reshuffle was a “call” and a “soft reminder” for partners, not an attempt to press them.
Earlier on Thursday, three Democratic Party executives, Amir Syamsuddin, Anas Urbaningrum and Jafar Hafsah, met with President Susilo Bambang Yudhoyono, proposing the latter to replace ministers from disloyal coalition partners, which the three said had refused to defend the government in the investigation of the Bank Century bailout case.
The parties are the Golkar Party, the Prosperous Justice Party (PKS), the National Mandate Party (PAN), the United Development Party (PPP) and the National Awakening Party (PKB).
The ministers from coalition parties include Communications and Information Technology Minister Tifatul Sembiring (PKS), Religious Affairs Minister Suryadharma Ali (PPP), Agriculture Minister Suswono (PKS), Maritime Affairs and Fisheries Minister Fadel Muhammad (Golkar), Manpower and Transmigration Minister Muhaimin Iskandar (PKB).
But presidential spokesman Julian Aldrin Pasha said the President had not given a response to the proposal.
Yudhoyono’s rivals in the July 8 presidential election, former president Megawati Soekarnoputri of the opposition Indonesian Democratic Party of Struggle (PDI-P) and former vice president Jusuf Kalla of Golkar, said over the weekend it was the President’s right to decide a reshuffle.
“That’s the President’s business. If he considers it important, that is good,” Megawati said while opening the regional conference of the PDI-P in Bali.
A PDI-P lawmaker told The Jakarta Post that the Democratic Party had approached Megawati, opening four possible positions for the opposition to fill.
Kalla, meanwhile, said that he was ready to see Golkar cadres replaced or retained.
Several critics aired their opinions Saturday, saying that the proposal is a bluff to make coalitionparties gather their acts together.
“In political communication theory, this is called a ‘fear-arising communication’ model, which in practice has never succeeded,” political observer Tjipta Lesmana told a discussion in Jakarta, Antara news agency reported. “This model has proven to be ineffective. The more pressure applied, the harder partners defy.”
University of Indonesia political observer Arbi Sanit said Golkar and PKS were the main targets of the reshuffle “threat”, with their being “most critical” among coalition members during questioning sessions of the inquiry committee. The inquiry committee has summoned both Vice President Boediono and Finance Minister Sri Mulyani Indrawati to explain the decision behind the Rp 6.76 trillion (US$716 million) bailout of the ailing bank. Some of the lawmakers launched harsh questions to the Vice President and the minister and others said in public that they believed Boediono should be impeached.
He predicted that in response to the threat, Golkar and the PKS would seek to negotiate with the Democratic Party, a move that could lead to a vague conclusion to the committee’s hearing.
Democratic Party lawmaker Ramadhan Pohan said his party did not press the coalition partners, but to the contrary, the partners were pressing his.
He said the proposal for reshuffle was a “call” and a “soft reminder” for partners, not an attempt to press them.
Garuda plans to develop secondary hubs, adds more routes
Indonesian flag carrier Garuda Indonesia plans to develop secondary hubs in Indonesian major cities in addition to its major hubs in Jakarta and Denpasar as part of its Quantum Leap program.
The secondary hubs would include cities such as Balikpapan in East Kalimantan, Medan in North Sumatra, Surabaya in East Java and Makassar in South Sulawesi, Garuda’s president director Emirsyah Satar said Wednesday.
Speaking at the Singapore Airshow in Changi, he said the secondary hubs were to generate local or feeder traffic as part of Garuda’s efforts to expand new routes to strengthen its domestic network.
Other efforts include feeds to and from international routes, and domestic hub by-pass routes for mature markets, such as the Medan-Surabaya route, without stopping over in Jakarta.
“We also plan to develop flights from all provincial capitals to Jakarta,” he told reporters.
Garuda is aiming to increase the frequency of flights covering existing high density networks.
Emirsyah said the Indonesian domestic market still had room to grow in the world’s largest archipelago with some 230 million people.
“The domestic market is about 40 million passengers so there is still plenty of room to grow,” he said.
“Especially now that we have regional autonomy in which each region has more freedom to handle its own affairs.”
Garuda recorded 1,333 departures per week in 2008 and aims for 2,702 departures per week by 2014.
On international routes, Garuda had 338 departures in 2008 and plans for 1,222 per week in 2014.
Emirsyah said the airline plans to expand routes to include Hong Kong, India and ASEAN countries as well as opening European and American routes.
Garuda will fly to Amsterdam as of June 1 with other cities being considered, including Frankfurt, London and Paris as well as Los Angeles.
Emirsyah said Garuda would still focus on the Asia Pacific region saying it was where the economic activities were taking place nowadays.
Emirsyah also said Garuda was pursuing full membership of global airline alliance arrangements.
“We have support from KLM and Korean Air for membership of the SkyTeam alliance,” he said.
Garuda also aims to increase its fleet of aircraft from 54 in 2008 to 116 by 2014.
The airline will use Boeing 737-800 New Generation for domestic and regional routes, Airbus 330-200/300 for medium-haul and Boeing 777-300 ER aircraft for long haul routes.
The secondary hubs would include cities such as Balikpapan in East Kalimantan, Medan in North Sumatra, Surabaya in East Java and Makassar in South Sulawesi, Garuda’s president director Emirsyah Satar said Wednesday.
Speaking at the Singapore Airshow in Changi, he said the secondary hubs were to generate local or feeder traffic as part of Garuda’s efforts to expand new routes to strengthen its domestic network.
Other efforts include feeds to and from international routes, and domestic hub by-pass routes for mature markets, such as the Medan-Surabaya route, without stopping over in Jakarta.
“We also plan to develop flights from all provincial capitals to Jakarta,” he told reporters.
Garuda is aiming to increase the frequency of flights covering existing high density networks.
Emirsyah said the Indonesian domestic market still had room to grow in the world’s largest archipelago with some 230 million people.
“The domestic market is about 40 million passengers so there is still plenty of room to grow,” he said.
“Especially now that we have regional autonomy in which each region has more freedom to handle its own affairs.”
Garuda recorded 1,333 departures per week in 2008 and aims for 2,702 departures per week by 2014.
On international routes, Garuda had 338 departures in 2008 and plans for 1,222 per week in 2014.
Emirsyah said the airline plans to expand routes to include Hong Kong, India and ASEAN countries as well as opening European and American routes.
Garuda will fly to Amsterdam as of June 1 with other cities being considered, including Frankfurt, London and Paris as well as Los Angeles.
Emirsyah said Garuda would still focus on the Asia Pacific region saying it was where the economic activities were taking place nowadays.
Emirsyah also said Garuda was pursuing full membership of global airline alliance arrangements.
“We have support from KLM and Korean Air for membership of the SkyTeam alliance,” he said.
Garuda also aims to increase its fleet of aircraft from 54 in 2008 to 116 by 2014.
The airline will use Boeing 737-800 New Generation for domestic and regional routes, Airbus 330-200/300 for medium-haul and Boeing 777-300 ER aircraft for long haul routes.
BI keeps rate low at 6.5% to back growth
The central bank on Thursday kept its benchmark rate low at 6.5 percent for the sixth straight month despite the surge in the inflation rate in January in order to support the country’s economic growth.
“The board of governors is confident that inflationary pressure will not yet appear at least until the
first half of 2010. All in all, 2010 inflation is assured to remain in line with the target of 5 percent [plus minus 1 percent],” Bank Indonesia (BI) said in a statement, citing the upcoming harvest season as a determining factor.
The year on year inflation rate rose to 3.72 percent in January, a jump from 2.78 percent in December, due to the rising prices of staple and processed foods, the Central Statistics Agency (BPS) reported.
The monthly inflation rose to 0.84 percent in January from 0.33 percent in December.
BI’s move to hold its rate was expected by analysts. They said BI might start increasing its rate at the earliest in the second half of this year due to possible stronger pressures from higher energy prices.
“We expect BI to increasing the rate in June by 25 basis points,” said Eric A. Sugandi, adding that BI might continue increasing its rate by 25 basis point each month until September, bringing the rate to 7.5 percent.
“In the second half of 2010 we will see stronger inflationary pressures from rising energy prices in the world market that will be transmitted to Indonesia’s economy through non-subsidized fuel prices, higher import costs, and perhaps, subsidized fuel price rises,” he said.
The government is currently revising the 2010 state budget to accommodate changes in the macroeconomic assumptions, notably the Indonesian crude price.
In 2008 the government raised subsidized fuel prices by 28.7 percent on average as the 2008 budget was hit by the surge in global oil prices.
BI said the economy has continued to recover along with the global recovery. Acting BI Governor Darmin Nasution said last month the economy might grow 5.2 percent this year and 6 percent in 2011.
The economy was estimated to grow by 4.3 percent last year, the government said. The BPS will announce the official growth figure on Feb. 10.
Indonesia’s positive growth has helped attract capital inflows into the country, so that foreign exchange reserves rose US$3.5 billion to $69.6 billion in Jan. 31, BI said.
Citi analyst Johanna Chua said BI’s move to keep its rate would create positive market conditions.
“BI’s dovish stance in the midst of other Asian central banks turning hawkish should see sustained demand for Indonesian bonds,” she said.
BI expected the low BI rate could help banks to spur lending to expand between 17 percent and 20 percent this year.
As of December last year lending grew by only 10 percent due to a combination of higher lending rates along with businesses being reluctant to expand in the context of the global downturn.
“The board of governors is confident that inflationary pressure will not yet appear at least until the
first half of 2010. All in all, 2010 inflation is assured to remain in line with the target of 5 percent [plus minus 1 percent],” Bank Indonesia (BI) said in a statement, citing the upcoming harvest season as a determining factor.
The year on year inflation rate rose to 3.72 percent in January, a jump from 2.78 percent in December, due to the rising prices of staple and processed foods, the Central Statistics Agency (BPS) reported.
The monthly inflation rose to 0.84 percent in January from 0.33 percent in December.
BI’s move to hold its rate was expected by analysts. They said BI might start increasing its rate at the earliest in the second half of this year due to possible stronger pressures from higher energy prices.
“We expect BI to increasing the rate in June by 25 basis points,” said Eric A. Sugandi, adding that BI might continue increasing its rate by 25 basis point each month until September, bringing the rate to 7.5 percent.
“In the second half of 2010 we will see stronger inflationary pressures from rising energy prices in the world market that will be transmitted to Indonesia’s economy through non-subsidized fuel prices, higher import costs, and perhaps, subsidized fuel price rises,” he said.
The government is currently revising the 2010 state budget to accommodate changes in the macroeconomic assumptions, notably the Indonesian crude price.
In 2008 the government raised subsidized fuel prices by 28.7 percent on average as the 2008 budget was hit by the surge in global oil prices.
BI said the economy has continued to recover along with the global recovery. Acting BI Governor Darmin Nasution said last month the economy might grow 5.2 percent this year and 6 percent in 2011.
The economy was estimated to grow by 4.3 percent last year, the government said. The BPS will announce the official growth figure on Feb. 10.
Indonesia’s positive growth has helped attract capital inflows into the country, so that foreign exchange reserves rose US$3.5 billion to $69.6 billion in Jan. 31, BI said.
Citi analyst Johanna Chua said BI’s move to keep its rate would create positive market conditions.
“BI’s dovish stance in the midst of other Asian central banks turning hawkish should see sustained demand for Indonesian bonds,” she said.
BI expected the low BI rate could help banks to spur lending to expand between 17 percent and 20 percent this year.
As of December last year lending grew by only 10 percent due to a combination of higher lending rates along with businesses being reluctant to expand in the context of the global downturn.
President asked to appoint new BI chief
A legislator has requested President Susilo Bambang Yudhoyono appoint an officer to lead Bank Indonesia, saying an empty seat may affect the bank’s performance in maintaining Indonesia’s economic stability.
“The [central bank chief] position has been vacant for a year. It is about time the President pick a name,” legislator Arif Budimanta, a member of House of Representatives Commission XI overseeing financial affairs, told kompas.com on Sunday.
The post has been available since former BI chief Boediono posed his resignation after entering the presidential election race alongside running mate Yudhoyono.
Speculation has emerged that senior banker Agus Martowardjojo and economist Iman Sugema are among promising candidates for the position.
However, Arif said he refused to support a certain candidate. “Most importantly, the candidate must have a strong commitment to fighting corruption, be hard working and be good in monetary issues.” (nkn)
“The [central bank chief] position has been vacant for a year. It is about time the President pick a name,” legislator Arif Budimanta, a member of House of Representatives Commission XI overseeing financial affairs, told kompas.com on Sunday.
The post has been available since former BI chief Boediono posed his resignation after entering the presidential election race alongside running mate Yudhoyono.
Speculation has emerged that senior banker Agus Martowardjojo and economist Iman Sugema are among promising candidates for the position.
However, Arif said he refused to support a certain candidate. “Most importantly, the candidate must have a strong commitment to fighting corruption, be hard working and be good in monetary issues.” (nkn)
KPK to question Robert Tantular on Monday
The Corruption Eradication Commission [KPK] plans to summon the former owner of Bank Century Robert Tantular on Monday.
“We will question him either tomorrow [Monday] or Wednesday,” KPK spokesman Johan Budi SP told news portal tempointeraktif.com on Sunday.
KPK will question Robert on his possible involvement in the controversial Rp 6.76 trillion (US$714 million) bailout of Bank Century, now renamed Bank Mutiara.
The KPK initially planned to question Robert last Tuesday. However, the KPK failed to get approval from the Jakarta High Court.
Robert is currently serving a five-year prison sentence for committing fraud. (nkn)
“We will question him either tomorrow [Monday] or Wednesday,” KPK spokesman Johan Budi SP told news portal tempointeraktif.com on Sunday.
KPK will question Robert on his possible involvement in the controversial Rp 6.76 trillion (US$714 million) bailout of Bank Century, now renamed Bank Mutiara.
The KPK initially planned to question Robert last Tuesday. However, the KPK failed to get approval from the Jakarta High Court.
Robert is currently serving a five-year prison sentence for committing fraud. (nkn)
Senin, 01 Februari 2010
SBY to form committee to oversee economy
President Susilo Bambang Yudhoyono said he would soon form an economic committee, involving business communities, tasked to assist the government to help solve problems hampering economic growth.
“In the near term, I will form the National Economic Committee, which will follow the government along not only in crisis but also in normal times,” Yudhoyono said in his speech Friday before hundreds of participants attending an event organized by the Indonesian Chamber of Commerce and Industry (Kadin).
“Thus, when a crisis strikes we wouldn’t be so busy and would be able to respond properly,” he added.
Yudhoyono said the committee would comprise members and executives of Kadin.
The powerful business group Kadin has supported the government by providing constructive criticisms and creating a roadmap for Indonesia’s economy for the period 2009 to 2014.
The government said it wants to achieve an average economic growth rate of between 6.3 and 6.8 percent in the next five years.
Yudhoyono said that learning from the 1997-1998 Asian financial crisis and the recent global financial crisis, the country would need a solid partnership between the government, the private sector and economists to tackle economic issues arising.
There was no such partnership during the Asian crisis, which led to prolonged negative impacts affecting Indonesia’s economy, the President said.
The partnership, however, was built and maintained during the recent global crisis, and this helped the country to hit higher growth while many other economies suffered contraction.
Indonesia’s economy expanded by about 4.3 percent last year and is expected to accelerate to 5.5 percent growth in 2010, the government said.
The Central Statistics Agency will announce the official figure of last year’s growth on Feb. 10.
Hariyadi Sukamdani, Kadin’s vice chairman on fiscal policies, taxation and customs, said the committee would play a crucial role in managing the economy.
“The National Economic Committee is needed to simplify communications and coordination between the real sector and the government,” he said.
He added that the real sector now needs supportive government policies to help it to expand and boost economic growth.
He cited the example of the fiscal stimulus worth Rp 73.3 trillion (US$7.84 billion) provided by the government last year to cushion the negative impacts of the global crisis, but this did not help the real sector very much.
“Although the real sector really needed the government’s help [at that time],” he said.
Economist Dradjad H. Wibowo said the National Economic Committee might have similar tasks to the National Economic Council (NEC) in the US.
The NEC, formed in 1993, is also called advise President Barack Obama on economic policies. It is headed by Lawrence Summers, appointed by Obama in 2009.
The NEC’s four principal functions are: coordinating policy-making on domestic and international economic issues; coordinating economic policy advice to the president; ensuring that policy decisions and programs are consistent with the president’s economic goals; and monitoring the implementation of the president’s economic policies.
“In the near term, I will form the National Economic Committee, which will follow the government along not only in crisis but also in normal times,” Yudhoyono said in his speech Friday before hundreds of participants attending an event organized by the Indonesian Chamber of Commerce and Industry (Kadin).
“Thus, when a crisis strikes we wouldn’t be so busy and would be able to respond properly,” he added.
Yudhoyono said the committee would comprise members and executives of Kadin.
The powerful business group Kadin has supported the government by providing constructive criticisms and creating a roadmap for Indonesia’s economy for the period 2009 to 2014.
The government said it wants to achieve an average economic growth rate of between 6.3 and 6.8 percent in the next five years.
Yudhoyono said that learning from the 1997-1998 Asian financial crisis and the recent global financial crisis, the country would need a solid partnership between the government, the private sector and economists to tackle economic issues arising.
There was no such partnership during the Asian crisis, which led to prolonged negative impacts affecting Indonesia’s economy, the President said.
The partnership, however, was built and maintained during the recent global crisis, and this helped the country to hit higher growth while many other economies suffered contraction.
Indonesia’s economy expanded by about 4.3 percent last year and is expected to accelerate to 5.5 percent growth in 2010, the government said.
The Central Statistics Agency will announce the official figure of last year’s growth on Feb. 10.
Hariyadi Sukamdani, Kadin’s vice chairman on fiscal policies, taxation and customs, said the committee would play a crucial role in managing the economy.
“The National Economic Committee is needed to simplify communications and coordination between the real sector and the government,” he said.
He added that the real sector now needs supportive government policies to help it to expand and boost economic growth.
He cited the example of the fiscal stimulus worth Rp 73.3 trillion (US$7.84 billion) provided by the government last year to cushion the negative impacts of the global crisis, but this did not help the real sector very much.
“Although the real sector really needed the government’s help [at that time],” he said.
Economist Dradjad H. Wibowo said the National Economic Committee might have similar tasks to the National Economic Council (NEC) in the US.
The NEC, formed in 1993, is also called advise President Barack Obama on economic policies. It is headed by Lawrence Summers, appointed by Obama in 2009.
The NEC’s four principal functions are: coordinating policy-making on domestic and international economic issues; coordinating economic policy advice to the president; ensuring that policy decisions and programs are consistent with the president’s economic goals; and monitoring the implementation of the president’s economic policies.
SBY is safe from impeachment, Kalla predicts
Former vice president Jusuf Kalla says that his former boss, President Susilo Bambang Yudhoyono, is relatively secure from impeachment.
"He is protected by the Constitution. As long as anyone does the right thing, they are secured," he told reporters after the declaration of the National Democrat mass organization in Jakarta on Monday.
Speculations about a possible impeachment on Yudhoyono are rife after the investigation on the Bank Century bailouit by an inquiry committe at the House of Representatives about to reach its finale.
The authority of the bailout was in the hands of Finance Minister Sri Mulyani and the then Bank Indonesia governor, Boediono, now vice president.
Mulyani and Boediono had said that the President knew about the bailout and also insisted that their policy was right for the country in the midst of the global crisis.
Speculations are also rife that the bailout fund might have been disbursed into the accounts of Yudhoyono's presidential campaign team members.
Yudhoyono and his Democratic Party have rejected the speculations and have also urged the case to be resolved as soon as possible.
"He is protected by the Constitution. As long as anyone does the right thing, they are secured," he told reporters after the declaration of the National Democrat mass organization in Jakarta on Monday.
Speculations about a possible impeachment on Yudhoyono are rife after the investigation on the Bank Century bailouit by an inquiry committe at the House of Representatives about to reach its finale.
The authority of the bailout was in the hands of Finance Minister Sri Mulyani and the then Bank Indonesia governor, Boediono, now vice president.
Mulyani and Boediono had said that the President knew about the bailout and also insisted that their policy was right for the country in the midst of the global crisis.
Speculations are also rife that the bailout fund might have been disbursed into the accounts of Yudhoyono's presidential campaign team members.
Yudhoyono and his Democratic Party have rejected the speculations and have also urged the case to be resolved as soon as possible.
Demonstrators demand KPK arrest lawyer for Bank Century bribery attempt
As many as 50 students and other youths grouped in the Young Indonesia Caucus demonstrated at the Corruption Eradication Commission (KPK) office in Jakarta Monday demanding the arrest of businessman Budi Sampoerna’s lawyer, Lukas, for attempted bribery of a police official.
Caucus spokesman Edy Chumaidy said that the Caucus could prove that Lucas had pledged to give Rp. 10 billion to now non-active National Police Detective Chief Comr.Gen. Susno Duaji for a letter facilitating the release of funds owned by PT. Lancar Sampoerna Bestari from the collapsed Bank Century.
He demanded that the Commission, as the spearhead of the nation’s fight against corruption, muster up the courage to use the ample evidence of attempted bribery to arrest Lukas as soon as possible.
Caucus spokesman Edy Chumaidy said that the Caucus could prove that Lucas had pledged to give Rp. 10 billion to now non-active National Police Detective Chief Comr.Gen. Susno Duaji for a letter facilitating the release of funds owned by PT. Lancar Sampoerna Bestari from the collapsed Bank Century.
He demanded that the Commission, as the spearhead of the nation’s fight against corruption, muster up the courage to use the ample evidence of attempted bribery to arrest Lukas as soon as possible.
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