Indonesia Economy Forum

[Indos]

Mandiri overtakes BRI to become country's largest bank​

Banking solutions: State-owned Bank Mandiri helps businesses face the current challenging times through online banking solutions. (Courtesy of Bank Mandiri/.)


Dzulfiqar Fathur Rahman (The Jakarta Post)
PREMIUM
Jakarta ● Mon, May 31, 2021



State-owned publicly listed Bank Mandiri has become the largest lender in Indonesia after booking double-digit asset growth, overtaking state-owned publicly listed Bank Rakyat Indonesia (BRI).

Assets of Bank Mandiri totaled Rp 1.58 quadrillion (US$110.56 billion) in March, up 20 percent from a year earlier, according to a press release from the lender, which is traded on the local bourse under the ticker symbol BMRI. The growth was largely a result of the consolidation of the newly-established Bank Syariah Indonesia (BSI).

“This significant asset growth is supported mainly by the successful merger of Bank Mandiri Syariah and two sharia bank subsidiaries of other state-owned banks to form Bank Syariah Indonesia and become a subsidiary of Bank Mandiri,” Bank Mandiri president director Darmawan Junaidi was quoted...

Mandiri overtakes BRI to become country's largest bank

Bank Mandiri has become the largest lender in Indonesia after incorporating the assets of Bank Syariah Indonesia.

www.thejakartapost.com

 

[Indos]

AlhamduliLLAH we have already got 75 million vaccines (not yet use) where majority are raw materials in which still needs time to be processed in our state own pharma company, PT BioFarma. Total vaccines that have already been received by Indonesia (used and new stock) is around 93 million vaccines

Indonesian own vaccine development is still underway and projected to be completed in 2022 where state owned Biofarma that will likely produce it.

In the other hand, private owned Pharmacy, Kalbe Farma, is part of vaccine development being carried out in South Korea. Late 2021 the vaccine will be tested in human and in 2022 it is projected to be ready.

So in mid 2022 insha Allah Indonesia will be self sufficient to produce its own vaccines without the need to get raw materials from China.

 

[Whizzack]

Will we become the Saudi Arabia of Nickel..?? and eventually ev batteries too...

Indonesia On Track To Dominate The Supply Of Nickel To Make Batteries
Tim Treadgold
Contributor
Asia

Indonesia is on track to become the world’s nickel capital with new projects potentially lifting the country’s share of the important stainless steel and battery metal ingredient to a whopping 60% of global output later this decade.
Much of the planned investment is linked to Chinese companies keen to cement their grip on stainless steel production and to meet fast growing demand for batteries which require a range of new-energy metals such as nickel, lithium, cobalt and copper.

Nickel production at a plant in South Sulawesi, Indonesia. Photo by Hariandi Hafid/SOPA ... [+]
LIGHTROCKET VIA GETTY IMAGES
The pace of growth in the Indonesia nickel sector can best be measured by an investment bank forecast that the country could lift its share of worldwide nickel production from 28% to 60% inside the next eight years.
PROMOTED



Macquarie, an Australian-based bank, described the plans for Indonesia nickel as a flood with a series of “mega” projects under construction, announced, or in the planning stage.
The latest proposed development, from PT Huayou Nickel Cobalt (Indonesia), is for a project at Weda Bay in the Halmahera district of North Maluku which plans to invest $2.08 billion on a project producing 120,000 tons of nickel a year, plus 15,000 tons of cobalt.
Massive And Cheap
Macquarie described the project, which involves a number of Chinese companies, as both massive and incredibly cheap in terms of capital outlay.
“Our database of Indonesia high-pressure, acid-leach (nickel) projects for batteries now contains eight announced projects with a combined capacity of almost 450,000 tons a year of nickel and 50,000 tons of cobalt,” Macquarie said.
The new projects are in addition to projects which will expand the production of a another material rich in nickel called nickel pig iron.
“By 2028, we are projecting Indonesian (nickel) production to exceed total 2020 world production of 2.5 million tons and for Indonesia production to rise from 28% of world production to almost 60%,” Macquarie said.
Big Win For the Indonesian Government
For the Indonesia Government the rising tide of processed and partly processed nickel is a significant victory which has resulted from forcing mining companies to stop exporting raw ore ore and invest in value-added processing.
The first crackdown on ore exports in 2014 was relaxed in 2017 and reintroduced last year in a process which has worked by forcing investment which has dramatically expanded the value of Indonesia’s nickel exports.

Tesla, and other electric cars, have a huge appetite for nickel. Photo by Sean Gallup/Getty Images)
“Even though nickel volumes have yet to surpass the highest levels of 2013, export revenues are now more than triple those of 2013 due to the move in exports up the value chain,” Macquarie said.
The bank said the pace at which new capacity is being built is “staggering”. Its latest analysis points to installed capacity reaching 1.788 million tons of nickel a year by the end of this year compared with total production last year of 600,000 tons of metal.
But the Indonesian nickel rush could be just what the world needs as governments encourage the shift to electric vehicles with their nickel-heavy batteries.
“What we cannot emphasize enough is that the world does need this level of (Indonesian) production,” the bank said.
Macquarie expects global demand for nickel in 2030 to be two million tons above 2020 demand with more than half of the increase coming from the battery sector.

Indonesia On Track To Dominate The Supply Of Nickel To Make Batteries

Indonesia is on track to become the world’s nickel capital.

www.forbes.com

 

[Indos]

AlhamduliLILLAH

Indonesia factory activity hits record high for 3rd month in row​

Rifki Nurfajri (The Jakarta Post)
PREMIUM
Jakarta ● Thu, June 3, 2021


Indonesia’s Purchasing Managers’ Index (PMI) rose to a record high for the third consecutive month in May, compelling manufacturers to hire new workers for the first time since the pandemic struck the country.

Business consultancy IHS Markit wrote in a press release on Wednesday that Indonesia’s PMI reached 55.3 in May, up from 54.6 in April, the highest reading ever recorded since the company started measuring the PMI in April 2011.

The PMI gauges factory activity based on a monthly survey of 400 local manufacturers. A PMI above 50 indicates expansion, while a PMI below 50 indicates contraction. “Companies signaled robust demand and output improvements, while the first increase in employment in 15 months was also an encouraging sign,” said IHS Markit economics associate director Jingyi Pan.

Indonesia factory activity hits record high for 3rd month in row

Indonesia’s Purchasing Managers’ Index (PMI) rose to a record high for the third consecutive month in May, compelling manufacturers to hire new workers for the first time since the pandemic struck the country.

www.thejakartapost.com

 

[Indos]

This Moody analyst lack of data before making any analyst

Indonesia won’t reach herd immunity until 2023: Moody’s

Moody's Analytics says that Indonesia, along with four other countries in the Asia-Pacific, could fall far behind in its bid to achieve "herd resilience", with serious repercussions for economic recovery.

www.thejakartapost.com

While in June this is the data

New vaccine arrival boosts govt readiness for 1 million vaccinations per day

National COVID-19 task force spokeswoman Siti Nadia Tarmizi has expressed optimism that the government will be ready to push for a vaccination rate of 1 million per day following the arrival of 8 million doses of bulk vaccine in the 14th batch from Sinovac Biotech Ltd on Monday.

www.thejakartapost.com

 

[Whizzack]

US agriculture giant Cargill to build US$200mil palm oil refinery in Indonesia

• INDONESIA
• Saturday, 05 Jun 2021
  8:17 PM MYT

SINGAPORE, June 4 (Reuters): US agribusiness giant Cargill Inc said it is building a US$200 million palm oil refinery in the Indonesian province of Lampung, which the company expects to be completed late next year.

The new refinery is part of a push by Cargill to fully oversee its palm oil supply chain "from plantation to customer" in order to meet North American and European demand for more sustainable palm oil, the company said.


"This project is a key step for Cargill to increase the availability of sustainably sourced and produced edible oil ingredients for our customers," Robert Aspell, president of Cargill Asia Pacific, said in the statement issued to the media.

"This fully integrated supply chain offers our customers assurance that stringent production requirements and the highest product quality are achieved," he said.


The construction of the refinery has started and is slated to be completed late 2022, the statement said.

Indonesia is the world's top producer of palm oil, which is used in a wide range of consumer products from food to cosmetics, but the versatile edible oil has faced a backlash particularly in some western markets over issues ranging from labour rights to forest clearance.

The palm oil industry has also been linked to forest fires in Indonesia, where in 2019 at least 1.6 million hectares of forest and other land were burned and losses were estimated at $5.2 billion as a choking haze blanketed the region. - Reuters

US agriculture giant Cargill to build US$200mil palm oil refinery in Indonesia

US agribusiness giant Cargill Inc said it is building a US$200 million palm oil refinery in the Indonesian province of Lampung, which the company expects to be completed late next year.

www.thestar.com.my

 

[Indos]

Prabowo and all political parties that support his stupid and reckles plan are actually the enemy of Indonesia now. I hope PAN and Democrat Parties that opposes that stupid plan get better result in 2024 Parliament election.

Indonesia needs to focus on economy, infrastructure, industrialization, and R&D program in order to win in these critical period (2021-2024) as not only to hopefully bring economy back to normal but also to make solid foundation before we compete in RCEP region (FTA ASEAN-China-Japan-South Korea-Australia-New Zealan).

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Credit risk remains high in Indonesia despite recovery: S&P
​

Mark Lempp (The Jakarta Post) Jakarta ● Wed, June 9, 2021

The general recovery of business activity in Indonesia has done little so far to reduce credit risks at companies under financial pressure, according to S&P Global Ratings.

In a report published on Tuesday, the credit rating agency warns that “weakening liquidity and reduced access to funding means the outlook remains negative for entities rated 'B' and below.”

In S&P’s grading scale, B refers to entities that can meet current financial commitments as long as business, financial or economic conditions do not worsen.

The overall economy is on the mend, according S&P, with gross domestic product (GDP) growth of 4.5 percent in 2021 projected to take output “roughly back to its pre-COVID full-year […] level” by the end of the year. That said, public finances are expected to take much longer to heal.

The New York-based firm says “it will be challenging for the [Indonesian] government to reduce its deficit to below 3 percent of GDP by 2023 as planned” and expects the government debt level to “hover at around 40 percent of GDP” at least until 2023. That compares to around 30 percent before the pandemic began.

Read also: COVID-19 resurgence poses risk to economy

S&P maintains a negative outlook on Indonesia’s sovereign rating, which it says reflects “continued downside pressure on Indonesia's external, fiscal, and debt settings due to the COVID-19 pandemic.” This, in turn, means a downside rating risk also continues for the banking sector and state-owned enterprises.

Nevertheless, S&P sees 2021 as “a year of recovery for Indonesian banks” but says the recovery will be very gradual because of the “significant levels of restructured loans […] at about 18 percent (of total loans) in 2020, compared with about 5 percent pre-COVID-19.”

The government has been pushing banks to restructure loans as borrowers reel from economic downturn. The Financial Services Authority (OJK) reported in late February that the amount of restructured loans was Rp 987.48 trillion (US$69.2 million) as of Feb. 8 and involved 101 banks.

Read also: Pandemic loan restructuring scheme inches toward $70.5 billion

S&P expects that “preemptive provisioning on these weak loans is likely to constrain [banks’] profitability" going forward, albeit less than last year.

Credit risk remains high in Indonesia despite recovery: S&P

While the overall economy is on the mend, downside risks remain for Indonesian credit as recovery in the banking sector is weighed down by a high level of restructured loans, says S&P Global Ratings.

www.thejakartapost.com

 

[Indos]

AlhamduliLLAH

There are many works needed to be done and we have to come back on our previous prudent economic policy and control our debt to equity ratio responsibly. What has been stated by our Finance Minister about decreasing budget deficit into below 3 % of GDP in 2023 and limit the debt to GDP ratio at 44 % in 2024 is already a right policy to make.

Current debt to GDP ratio has already been at 40 percent and it will increase a little bit in 2021 and 2022 as way to boost the economy during this difficult time but in more reasonable and responsible way.

We need to have nominal GDP at 1.5 trillion USD in 2024 to have good enough budget that can finance our defense spending in more sustainable way while keep increasing local defense products sophistication through R&D and also securing their future market by our commitment to buy local defense products as much as we can.

Having experience in getting embargoes from both USSR and US/British should make us understand the importance to have strong local defense industry to achieve independency some day.

-----------------------------------

Indonesia records trade balance surplus for 13 consecutive months in May

Source: Xinhua| 2021-06-15 21:00:17|Editor: huaxia


JAKARTA, June 15 (Xinhua) -- Indonesia recorded a trade balance surplus of 2.36 billion U.S. dollars in May, a positive achievement for 13 consecutive months, according to the country's Central Agency of Statistics on Tuesday.

Indonesia has obtained the trade balance surplus since May 2020 when the country logged a surplus of 2.09 billion dollars while with a deficit of 0.37 billion dollars in the previous month.

The agency's head Kecuk Suhariyanto said the surplus in May came from the difference between the export value of 16.595 billion dollars and the import value of 14.234 billion dollars.

Indonesia's trade balance in May 2021 reached a surplus with the United States of 1.08 billion dollars, the Philippines 0.54 billion dollars, and Malaysia 0.44 billion dollars, but had a deficit with China of 0.51 billion dollars, Australia 0.33 billion dollars, and South Korea 0.19 billion dollars.

From January to May 2021, the accumulated surplus was recorded at 10.17 billion dollars, higher than that in the same period of last year, which only stood at 4.18 billion dollars. Enditem

Indonesia records trade balance surplus for 13 consecutive months in May - Xinhua | English.news.cn

 

[Indos]

Jakarta has started mass vaccination for young people (18 years old until 50 years old) while previously it focused on front line civil servants, old people, medical personnel, and also state owned companies workers.

Private sectors are also doing their part by using non subsidize vaccine to vaccinates their workers.

The target is to get 7.5 million people vaccinated in Jakarta (10 million population) by the end of August.

Second dose will be done 3 months from now and mostly Jakarta will use Astrazenika until August, so basically Jakartan will mostly get Astrazenika than Sinovac

For Jakartan that hasnt got their vaccination program by their RW, they can register online by themselves, here how to do it

 

[Indos]

This is why Jokowi trust his economic team more than others. They are inline with Made in Indonesia campaign and also responsible. We can compare to recent Prabowo plan to buy huge imported foreign defense equipment with Jokowi economic team policy

Health Ministry is an Economist, he is former state owned Mandiri bank CEO and previously working as Vice Minister of SOE ministry


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Health Ministry to cut health equipment imports this year

​

Workers finish making face masks at PT Multi One Plus, Gunung Putri, Bogor regency, West Java, on April 15, 2020.(Antara/Yulius Satria Wijaya)


Rifki Nurfajri (The Jakarta Post)
PREMIUM
Jakarta ● Thu, June 17, 2021

The Health Ministry plans to swap this year Rp 6.5 trillion (US$449.5 million) worth of imported health equipment with locally made versions in steering government spending to favor Indonesian manufacturers.

Health Minister Budi Gunadi Sadikin said in a press conference on Tuesday that the funds would be used to purchase 5,462 medical items that included syringes, hospital beds, alcohol swabs and oxygen masks, among other equipment.


With the swap, the ministry would raise the amount of locally made medical equipment purchases this year from 1,686 items to 7,148 items, or 17 percent of the total planned purchases.

"With the purchase of the 5,462 pieces of medical equipment, we can bring the money to the local producers," said Budi. The swap marks another government strategy to revive the country’s manufacturing sector, which contr...

Health Ministry to cut health equipment imports this year

The Health Ministry plans to swap this year Rp 6.5 trillion (US$449.5 million) worth of imported health equipment with locally made versions in steering government spending to favor Indonesian manufacturers.

www.thejakartapost.com

 

[Whizzack]

About time!
--------------------------------------------------------------------------------------
Indonesia, home to giant gold mine, wants its own bullion bank

WED, JUN 23, 2021 - 8:55 AM
[JAKARTA] Indonesia, home to one of the world's largest gold mines, plans to set up a bullion bank to spur trading of the precious metal domestically.
The government is consulting with parties including the central bank and the mining industry, with a plan to start operating the bank in 2024, Trade Minister Muhammad Lutfi said.
"Our exports have gone to transit countries because they have better gold trading systems, either in the form of bullion banks or better bourses than ours," Mr Lutfi said in an interview on Monday. "As a gold producing country why would we sell it to transit countries?"
Indonesia is South-east Asia's biggest gold producer, with the Grasberg mine in Papua holding one of the world's largest reserves.

The push to create a bullion bank is part of resource-rich Indonesia's broader effort to climb up the commodities value chain. That drive has included forcing copper and nickel miners to invest in domestic refining, allowing the country to profit from higher-value products rather than just raw materials exports.

Bullion banks are involved in activities including clearing, hedging, trading and vaulting of gold and precious metals.
Global banks which engage in bullion banking include JPMorgan Chase & Co. and HSBC Holdings, with most being members of the London Bullion Market Association.
Having an onshore bullion bank would cut the need to import gold products after they're certified overseas, help develop the local industry by providing financing opportunities, and let the central bank use gold instruments to manage stability, said Iskandar Simorangkir, deputy for macroeconomics and finance policy coordination at the Coordinating Ministry for Economic Affairs.
Indonesia currently exports much of its gold to countries such as Singapore and Australia, which are hubs for trading rather than consumption, Mr Lutfi said. The government is in talks with gold-buying countries, including members of Gulf Cooperation Council, to set up trade deals to compete with those "transit countries", he added.
BLOOMBERG

https://www.businesstimes.com.sg/energy-commodities/indonesia-home-to-giant-gold-mine-wants-its-own-bullion-bank

 

[Indos]

About time!
--------------------------------------------------------------------------------------
Indonesia, home to giant gold mine, wants its own bullion bank

WED, JUN 23, 2021 - 8:55 AM
[JAKARTA] Indonesia, home to one of the world's largest gold mines, plans to set up a bullion bank to spur trading of the precious metal domestically.
The government is consulting with parties including the central bank and the mining industry, with a plan to start operating the bank in 2024, Trade Minister Muhammad Lutfi said.
"Our exports have gone to transit countries because they have better gold trading systems, either in the form of bullion banks or better bourses than ours," Mr Lutfi said in an interview on Monday. "As a gold producing country why would we sell it to transit countries?"
Indonesia is South-east Asia's biggest gold producer, with the Grasberg mine in Papua holding one of the world's largest reserves.

The push to create a bullion bank is part of resource-rich Indonesia's broader effort to climb up the commodities value chain. That drive has included forcing copper and nickel miners to invest in domestic refining, allowing the country to profit from higher-value products rather than just raw materials exports.

Bullion banks are involved in activities including clearing, hedging, trading and vaulting of gold and precious metals.
Global banks which engage in bullion banking include JPMorgan Chase & Co. and HSBC Holdings, with most being members of the London Bullion Market Association.
Having an onshore bullion bank would cut the need to import gold products after they're certified overseas, help develop the local industry by providing financing opportunities, and let the central bank use gold instruments to manage stability, said Iskandar Simorangkir, deputy for macroeconomics and finance policy coordination at the Coordinating Ministry for Economic Affairs.
Indonesia currently exports much of its gold to countries such as Singapore and Australia, which are hubs for trading rather than consumption, Mr Lutfi said. The government is in talks with gold-buying countries, including members of Gulf Cooperation Council, to set up trade deals to compete with those "transit countries", he added.
BLOOMBERG

https://www.businesstimes.com.sg/energy-commodities/indonesia-home-to-giant-gold-mine-wants-its-own-bullion-bank

Nice, particularly after state own PT Inalum (100 % stake own by Indonesia government) own 51 % of PT Freeport Indonesia

Second largest gold and chopper Miner in Indonesia, PT Newmont Nusa Tenggara has also been acquired by Medco, a national company owned by Arifin Panigoro family

Medco has 82 % stake on PT Newmont Nusa Tenggara since 2016

 

[Indos]

Another fresh news that is also related to Gold

State miner Antam digs deeper into gold products market​

Hello Kitty minted gold bars are among Antam’s innovations to enter the international market.(Antam's Instagram/File)



Vincent Fabian Thomas (The Jakarta Post)
PREMIUM
Jakarta ● Wed, June 23, 2021

State-owned diversified miner PT Aneka Tambang (Antam) has delved into smaller gold bar and gold jewelry production to expand the market reach of its best-selling metal.

Antam said in a statement on Tuesday that the new products included 0.1 and 0.25 gram gold bars, which were lighter than the current smallest gold bar at 0.5 gram, as well as gold bracelets, wedding rings, pendants and necklaces.

"This initiative provides an opportunity for everyone in Indonesia to start investing in fine gold. Beforehand, gold investment was only attainable for the middle-upper communities,” said Antam operations and business transformation director Risono.

The publicly listed miner has been getting deeper into the gold products market ever since the government commenced a nickel ore export ban in January 2020. Such ores used to be one of the company’s b...

State miner Antam digs deeper into gold products market

Antam has launched smaller gold bars aimed at lower-income households and gold jewelry aimed at middle-upper income households.

www.thejakartapost.com

 

[Indos]

BPK raises concern about govt's ability to service debt
​

Dzulfiqar Fathur Rahman (The Jakarta Post)
PREMIUM
Jakarta ● Wed, June 23, 2021

The Supreme Audit Agency (BPK) has warned the government over a potential decline in its ability to service its increasing debt, after it hiked state spending in 2020 to finance economic stimulus measures as part of the national pandemic response.

BPK chairman Agung Firman Sampurna said that interest payments on national debt relative to government revenue stood at 19.06 percent last year, much higher than the 7 percent to 10 percent recommended by the International Monetary Fund (IMF).

BPK raises concern about govt's ability to service debt

The BPK has expressed concern over the national debt, noting that the country's interest payments amounted to 19.06 percent of state revenue last year, far exceeding the IMF's recommended 7 to 10 percent.

www.thejakartapost.com

 

[Indos]

AlhamduliLLAH

There are many works needed to be done and we have to come back on our previous prudent economic policy and control our debt to equity ratio responsibly. What has been stated by our Finance Minister about decreasing budget deficit into below 3 % of GDP in 2023 and limit the debt to GDP ratio at 44 % in 2024 is already a right policy to make.

Current debt to GDP ratio has already been at 40 percent and it will increase a little bit in 2021 and 2022 as way to boost the economy during this difficult time but in more reasonable and responsible way.

We need to have nominal GDP at 1.5 trillion USD in 2024 to have good enough budget that can finance our defense spending in more sustainable way while keep increasing local defense products sophistication through R&D and also securing their future market by our commitment to buy local defense products as much as we can.

Having experience in getting embargoes from both USSR and US/British should make us understand the importance to have strong local defense industry to achieve independency some day.

-----------------------------------

Indonesia records trade balance surplus for 13 consecutive months in May

Source: Xinhua| 2021-06-15 21:00:17|Editor: huaxia


JAKARTA, June 15 (Xinhua) -- Indonesia recorded a trade balance surplus of 2.36 billion U.S. dollars in May, a positive achievement for 13 consecutive months, according to the country's Central Agency of Statistics on Tuesday.

Indonesia has obtained the trade balance surplus since May 2020 when the country logged a surplus of 2.09 billion dollars while with a deficit of 0.37 billion dollars in the previous month.

The agency's head Kecuk Suhariyanto said the surplus in May came from the difference between the export value of 16.595 billion dollars and the import value of 14.234 billion dollars.

Indonesia's trade balance in May 2021 reached a surplus with the United States of 1.08 billion dollars, the Philippines 0.54 billion dollars, and Malaysia 0.44 billion dollars, but had a deficit with China of 0.51 billion dollars, Australia 0.33 billion dollars, and South Korea 0.19 billion dollars.

From January to May 2021, the accumulated surplus was recorded at 10.17 billion dollars, higher than that in the same period of last year, which only stood at 4.18 billion dollars. Enditem

Indonesia records trade balance surplus for 13 consecutive months in May - Xinhua | English.news.cn

Debt expected to rise until at least 2022​

The Finance Ministry building.(Courtesy of Finance Ministry/-)



Dzulfiqar Fathur Rahman (The Jakarta Post)
PREMIUM
Jakarta ● Mon, July 5, 2021

The government expects public debt to keep rising for at least the next two years as the country tries to recover from the pandemic-induced economic slump, a Finance Ministry official has said.

Finance Ministry debt securities director Deni Ridwan said the increasing debt was necessary to finance the country’s billion-dollar health and economic recovery programs as state revenue lagged during the recession.

“One thing is certain, the projection for this year to the next suggests the debt burden will keep increasing in line with the amount of state spending needed for national economic recovery programs,” Deni said on July 1, as reported by Kontan.

The pandemic has forced the government to borrow more, causing the ratio of public d...

Debt expected to rise until at least 2022

Indonesian government expects debt to keep rising until at least next year. Analysts say it may take longer to level off.

www.thejakartapost.com