Indonesia's Economy, Political, Social, and Science Development Thread

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Astra Agro to spend $350m on expansion
Tassia Sipahutar, The Jakarta Post | Business | Wed, April 24 2013, 1:25 PM

Plantation firm PT Astra Agro Lestari (AALI), part of Astra International (ASII), has announced that it would allocate between US$300 million and $350 million to finance capital expansion, which will include the construction of two new processing mills and a palm oil refinery this year.

According to Astra Agro president director Widya Wiryawan, the new mills will be located in Aceh and East Kalimantan provinces. Each mill will cost around $15 million and will have a capacity of 45 tons per hour. “The construction will begin this year and is expected to be complete within 18 months,” he said in Jakarta on Tuesday.

Currently, Astra Agro operates 26 mills with a total capacity of 1,230 tons per hour. It will begin operations at two other mills — also with a capacity of 45 tons per hour each — in South Kalimantan and Central Sulawesi provinces by year-end.

By 2015, the company will have a total of 30 mills.

Besides processing mills, Astra Agro will also begin operations at its first refinery in 2013. The $75-million refinery is located in Mamuju, West Sulawesi, and will convert the company’s crude palm oil (CPO) into olein and stearin. The refinery’s production capacity is expected to be 2,000 tons per day and will be supplied from Astra Agro’s plantations in Kalimantan and Sulawesi.

Funding for the expansion will be generated from internal reserves and bank loans, according to Widya. He said that four banks — the Overseas-Chinese Banking Corporation (OCBC), Mizuho Corporate Bank, Sumitomo Mitsui Banking Corporation and Bank of Tokyo-Mitsubishi UFJ — had expressed their commitment to providing $200 million in loans for the company.

“Right now we are in discussions to increase the loan amount to $400 million. Hopefully we will seal the deal in this second quarter,” he said.

Meanwhile, Astra Agro reported that its CPO sales volume for the first quarter of 2013 rose by 28 percent to 382,900 tons from the same period last year. Sales were still dominated by the local market with 96.3 percent, exports accounting for the remaining 3.7 percent.

However, despite the double-digit growth in sales, Astra Agro only managed to increase its revenues by 5.5 percent to Rp 2.72 trillion (US$ 280 million) as a result of low CPO prices. Between January and March, its average selling price was Rp 6,466 per kilogram, lower than the Rp 7,733 per kilogram it recorded last year.

 

[Reashot Xigwin]

Good news for all stoner & hipster

Minister considers state firm cannabis farming
The Jakarta Post, Jakarta | National | Wed, April 24 2013, 4:16 PM

State-Owned Enterprises Minister Dahlan Iskan says he is considering the possibility of allowing state-owned enterprises to manage cannabis farmlands for health purposes, including for curing cancer and heart disease.

Dahlan spoke of his interest in learning about cannabis farmland for medical purposes after a discussion with a pharmacist last week.

"The idea has been raised by a pharmacist - that cannabis seeds can be utilized for heart and cancer medication," Dahlan said on Tuesday as quoted by Antara news agency.

According to him, the pharmacist briefly described the technical use of cannabis seeds as the raw material of medicines.

"It’s a logical thing from a pharmaceutical point of view, so I asked the pharmacist to prepare references on the use of the cannabis seeds for medical treatment," the minister said.

Dahlan, however, declined to mention identity of the pharmacist.

"Why do state-owned enterprises not consider the possibility of developing cannabis farmland as an alternative to medication, instead of just burning the cannabis?" Dahlan asked. (asw)

Minister considers state firm cannabis farming | The Jakarta Post

finally an excuse to use this emoticon

 

[Reashot Xigwin]

Continuation from my last post (I love this emoticon)

Dahlan considers development of marijuana farms
Yuliasri Perdani, The Jakarta Post, Jakarta | Headlines | Thu, April 25 2013, 9:58 AM

Marijuana destruction: An Acehnese policeman destroys a marijuana field in the Kuta Malaka mountain area in Aceh Besar, Aceh, in this file photo. State-Owned Enterprises Minister Dahlan Iskan stirred controversy on Wednesday when he said that the government was considering the idea of managing a marijuana plantation for medical purposes. (Antara)

State-Owned Enterprises Minister Dahlan Iskan has made another controversial move by considering an offer to develop marijuana farms for medicinal purposes.

Dahlan, a media tycoon and potential presidential candidate, said on Tuesday that a pharmacist had suggested he get involved in this agricultural business.

“A pharmacist suggested that state-owned enterprises [SOEs] should develop marijuana fields for the production of medications,” he said in Jakarta as quoted by Antara.

“Why do state-owned enterprises not consider the possibility of developing cannabis farmland as an alternative to medication, instead of just burning the cannabis?” Dahlan asked.

According to Dahlan, the pharmacist said that marijuana leaves and seeds could cure heart disease and cancer. Moreover, the pharmacist believed that Indonesia’s climate and land were ideal for marijuana planting, he said.

“He has given me complete references for that. I am still studying them. But, if a state-owned enterprise had marijuana fields, there would surely be an uproar,” Dahlan said.

Law enforcers were quick to dismiss Dahlan’s idea.

National Police spokesperson Sr. Comr. Agus Rianto indicated that it was unlikely the ministry would get involved in the controversial agricultural enterprise.

“We have a clear regulation on that. So, anyone who wants to plant [cannabis] needs to comply with the applicable law. If not, he will have violated the law,” Agus said on Wednesday.

Agus was referring to the 2009 Narcotics Law that categorizes all parts of the marijuana plant as narcotics type I. Article 8 (1) of the law stipulates that type I narcotics are prohibited from being used for medical purposes.

Agus’ statement was echoed by National Narcotics Agency (BNN) spokesman Sr. Comr. Sumirat. “The law prohibits the distribution and misuse of marijuana. It can only be used for science and research purposes,” he said on Wednesday.

Article 8 (2) stipulates that, “In a limited amount, type I narcotics can be used for science and technology-development purposes, and diagnostic and laboratory reagents after gaining approval from the [health] minister and head of the Food and Drug Supervision Agency.”

When The Jakarta Post sought confirmation, an aide to Health Minister Nafsiah Mboi said that the minister would not make an immediate statement.

According to Article 111 of the law, anyone who, without permission, plants or keeps narcotics type I faces a maximum penalty of 12 years’ imprisonment and an Rp 8 billion (US$823,000) fine.

Although marijuana is widely known as an illegal and dangerous substance in Indonesia, a group called Lingkar Ganja Nusantara (the Nusantara Marijuana Network) has been trying to eradicate misconceptions about marijuana.

Established in 2008, the network has organized campaigns and discussions about the positive uses of marijuana, and has called on the government to legalize it.

Lingkar Ganja Nusantara chairman Irwan Syarif said that marijuana contained a chemical compound known as cannabinoid, which could be used as an effective painkiller to control nausea and to stimulate a person’s appetite.

For industrial purposes, he said that the fiber from hemp, a type of cannabis plant, could be used as raw material in the production of rope, pulp, oil and food.

Long before marijuana was deemed an illegal substance, some communities in Indonesia used it as a spice for traditional cuisine.

Dahlan considers development of marijuana farms | The Jakarta Post

 

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JCI Second Highest in the World
BY DONNY SUSILO, FIRDAUS NUR IMAN & DYAH YOSSIE

JAKARTA - Performance growth of the stock market in Indonesia is the second highest year-to-date after the stock market in Japan. Indonesia’s table fundamental economy and the investment grade debt rating have become the positive sentiments for investors to engage in the domestic stock market that generates high returns.

The Jakarta Composite Index (JCI) grew 15.26 percent year-to-date on April 23, 2013, or below the Nikkei 225’s growth of 30.15 percent. The Stock Exchange of Thailand (SET) grew 11.31 percent, the Dow Jones Industrial Average (DJIA) rose 11.16 percent, while the Financial Times Stock Exchange (FTSE) gained 7.40 percent.

JCI Second Highest in the World - Indonesia Finance Today

Ratu Prabu Eyes US$ 1 B Gas Pipe Project in Myanmar
BY IGNASIUS LAYA


JAKARTA - PT Ratu Prabu Energi Tbk (ARTI, through the company’s subsidiary PT Lekom Maras, will expand the company’s business to Myanmar. B. Bur Maras, President Director of Ratu Prabu Energy, said the company has obtained an invitation from Myanmar to conduct pipeline gas distribution system studies after Myanmar found a new gas and oil reserve.

The oil and gas reserve is located offshore, and must be transported to land and distributed to cement factories and industries that need gas. “The investment reaches US$ 1 billion, and Ratu Prabu is one of the consultants there. We expect to participate in this venture, and we will submit the auction,” he said in Jakarta on Wednesday.

http://en.indonesiafinancetoday.com/read/32172/Ratu-Prabu-Eyes-US-1-B-Gas-Pipe-Project-in-Myanmar

 

[Reashot Xigwin]

Indonesia: 36 new solar plants planned for 2013
29. April 2013 | Applications & Installations, Markets & Trends, Industry & Suppliers | By: Shamsiah Ali-Oettinger

The Indonesian government is planning to develop 36 new solar plants across the country this year, according to local media. A higher budget has also been allocated for solar development.

Indonesia is said to be an attractive emerging market for solar.
Flickr/Bruce Tuten

Director of renewable energy and energy conservation at the Ministry of Energy and Mineral Resources, Alihudin Sitompul, has stated that the Indonesian government was planning on increasing the number of solar plants in the country to 153 this year. With the 36 new solar plants that are in the pipeline for 2013, this goal can be achieved. This was reported by local newspaper Jakarta Globe.

Sitompul apparently added that the federal government and its provincial counterparts have set aside Indonesian Rupiah (IDR) 1 trillion (US$103 million) for solar development this year. This will be a significant increase from last year's IDR 700 billion budget.

Indonesia is not an easy market for solar power, as was already highlighted at the Renewables Indonesia last year. The country is blessed with natural resources and more than 90% of the energy comes from conventional sources.

"So far, our policies regarding the development of solar power plants are already good. However, our partners should be able to decide whether the [solar plant projects] are feasible or not, so that they do not force themselves to do them," Sitompul is quoted as saying. Moreover, he told local media that forcing unfeasible projects to realization often results in delays, improper installation, lower quality plants and higher prices.

Even though the solar power development momentum has not been that of neighbors Thailand and Malaysia, Indonesia has been picked out as one of the most important emerging markets for solar in Southeast Asia.

NPD Solarbuzz stated in its Emerging PV Markets: Asia Pacific and Central Asia Report that the ground-mount segment will account for 64% of all photovoltaic demand in the region, and Indonesia will lead this development together with Malaysia, Thailand, the Philippines and Taiwan.

Indonesia, with its thousands of surrounding islands, is also predicted to gain ground with the provision of distributed electricity via solar power.

Read more: Indonesia: 36 new solar plants planned for 2013: pv-magazine



RI ranks third on SE Asia remittance list
Veeramalla Anjaiah, The Jakarta Post, Jakarta | Business | Mon, April 29 2013, 12:10 PM

Indonesia received US$7.2 billion from around 6.5 million migrant workers overseas in 2012, the World Bank said in a recent report.

The figure was equal to about 1 percent of the nation’s gross domestic product, making Indonesia the third-largest recipient of remittances in Southeast Asia, the report said.

According to the recently released World Bank Migration and Development Brief, the Philippines was the top receiver of remittances in Southeast Asia at $24.45 billion, placing the nation behind India ($69.35 billion) and China ($60.24 billion) globally.

Vietnam, receiving $10 billion in remittances according to the report, was ranked second in the region and ninth in the world.

The report said that migrant workers from developing countries remitted a record $401 billion last year, up 5.3 percent from 2011.

If remittances to developed countries were added, overall global remittances topped $514 billion in 2012, up 239 percent from $132 billion in 2000, according to the report.

Meanwhile, nations in Southeast Asian received $47.96 billion in remittances from migrant workers in 2012, up 8.43 percent from $44.23 billion in 2011 but below the record $109 billion booked by South Asian nations in 2012, up 12.3 percent from 2011.

“Migration and remittances offer a vital lifeline for millions of people and can play a major role in an economy’s takeoff,” World Bank chief economist Kaushik Basu said while launching the Global Knowledge Partnership on Migration and Development (KNOMAD) initiative.

“They enable people to partake in the global labor market and create resources that can be leveraged for development and growth. But they are also a source of political contention, and for that very reason deserving of dispassionate analysis,” he said.

The KNOMAD initiative was established with the support of Germany and Switzerland as an international hub of knowledge and policy expertise on migration issues.

According to the United Nations, more than 215 million people live outside their nations of birth, and over 700 million people migrate within their home nations.

More than half of Indonesia’s 6.5 million migrant workers currently work in only two countries — Malaysia and Saudi Arabia, both legally and illegally. Most of the workers are ill-educated women who work as housemaids or as agricultural or factory workers.

However, the figures might underestimate the amount of remittances, considering that many migrant workers wait to bring their earnings home in cash.

“Not everybody sends money through banks,” Jumhur Hidayat, the head of the Indonesian Migrant Worker Placement and Protection Agency (BNP2TKI) told detik.com recently.

“Many workers bring money home along with them. So combined together, the official and unofficial remittances by Indonesian workers might reach Rp 120 trillion [US$12.36 billion],” he said.

In case of the Philippines, it has been estimated that 12.6 million overseas Filipino workers (OFW) remit around $24.45 billion unofficially every year, much higher than the official remittance figure of $7.2 billion for 6.5 million
Indonesians.

Most Indonesian migrant workers are housemaids who receive lower salaries than their more highly skilled Philippines peers.

The Indonesians lack language and work skills, leaving them prone to exploitation and torture by unscrupulous employers and labor agencies. Indonesian migrant workers were also under educated, according to one official.

“Over 54.2 million people of Indonesia’s total workforce of 109 million are elementary school graduates, so you can imagine the quality of our human resources,” Dita Indah Sari, an adviser to Manpower and Transmigration Minister Muhaimin Iskandar, told tempo.co recently.

Due to a lack of skilled workers and professionals, Indonesian firms currently employ a large number of foreigners.

According to the Manpower and Transmigration Ministry, there were 118,777 foreigners working across the nation as of November 2012, most of whom worked in Jakarta (74,762 employees) West Java (13,046) and Banten (7,728).

The foreign workers were principally employed in the manufacturing, mining, energy, hospitality, trade, banking, insurance and other service sectors.

Indonesia, according to the World Bank’s Migration and Remittances Fact Book, experienced an outflow of $3.16 billion from these foreign workers in 2011, up from $2.84 billion in 2010.

 

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Indonesia Sees Economic Growth at 6.5 Percent in 2013
By Reuters on 3:02 pm April 30, 2013.
Category Business, Economy
Tags: Hatta Rajasa, Indonesia economic growth

Indonesia expects gross domestic product to expand 6.5 percent this year despite a slowdown in the global economy, acting finance minister Hatta Rajasa said on Tuesday.

He estimated 2014 growth at 6.4-6.9 percent, due to increased economic activity during next year’s general and presidential elections.

The economy expanded 6.23 percent in 2012.

Rajasa, who is also chief economic coordinating minister, said the G20 economy’s budget deficit will dip to 1.5 percent in 2014, from 1.65 percent this year.

The rupiah, emerging Asia’s worst performing currency last year, is seen at 9,600-9,800 per dollar next year, around current levels.

The net oil importer estimates oil liftings at 840,000 barrels per day this year, rising to around 900,000-930,000 barrels in 2014.

Reuters











Indonesia: 36 new solar plants planned for 2013

The Indonesian government is planning to develop 36 new solar plants across the country this year, according to local media. A higher budget has also been allocated for solar development.

Indonesia is said to be an attractive emerging market for solar.
Flickr/Bruce Tuten

Director of renewable energy and energy conservation at the Ministry of Energy and Mineral Resources, Alihudin Sitompul, has stated that the Indonesian government was planning on increasing the number of solar plants in the country to 153 this year. With the 36 new solar plants that are in the pipeline for 2013, this goal can be achieved. This was reported by local newspaper Jakarta Globe.

Sitompul apparently added that the federal government and its provincial counterparts have set aside Indonesian Rupiah (IDR) 1 trillion (US$103 million) for solar development this year. This will be a significant increase from last year's IDR 700 billion budget.

Indonesia is not an easy market for solar power, as was already highlighted at the Renewables Indonesia last year. The country is blessed with natural resources and more than 90% of the energy comes from conventional sources.

"So far, our policies regarding the development of solar power plants are already good. However, our partners should be able to decide whether the [solar plant projects] are feasible or not, so that they do not force themselves to do them," Sitompul is quoted as saying. Moreover, he told local media that forcing unfeasible projects to realization often results in delays, improper installation, lower quality plants and higher prices.

Even though the solar power development momentum has not been that of neighbors Thailand and Malaysia, Indonesia has been picked out as one of the most important emerging markets for solar in Southeast Asia.

NPD Solarbuzz stated in its Emerging PV Markets: Asia Pacific and Central Asia Report that the ground-mount segment will account for 64% of all photovoltaic demand in the region, and Indonesia will lead this development together with Malaysia, Thailand, the Philippines and Taiwan.

Indonesia, with its thousands of surrounding islands, is also predicted to gain ground with the provision of distributed electricity via solar power.



Read more: Indonesia: 36 new solar plants planned for 2013: pv-magazine

 

[Reashot Xigwin]

Semen Indonesia Takes on Vietnam Rival With Myanmar Expansion
By Janeman Latul & Andjarsari Paramaditha on 5:21 pm April 30, 2013.

Semen Indonesia chief Dwi Soetjipto said on Monday that his company plans to build a $200 million factory in Myanmar in 2014. (Reuters Photo/Supri)

Semen Indonesia plans to build a $200 million factory in Myanmar in 2014 as it expands its business in Southeast Asia to take on Thai rival Siam Cement, the head of country’s biggest cement maker said.

The Myanmar plan is the latest expansion strategy by the Gresik-based company, which became the first Indonesian state-owned firm to make an overseas corporate acquisition when it bought a majority stake in Vietnam’s Thang Long Cement in 2011.

“If everyone is in Vietnam and Myanmar and we just play in Indonesia, then, like playing chess, we will be squeezed,” chief executive Dwi Soetjipto told Reuters on Tuesday, while listening to a rock music in his spacious office in central Jakarta. “That’s why we put our bishop in Vietnam and our knight in Myanmar.”

Vietnam’s property market has come to a standstill in the past two years after a long period of strong growth fuelled by local bank lending. This has presented foreign buyers with cheap takeover targets, Soetjipto said.

The Vietnamese cement industry has overcapacity of around 30 million tons per year, some of which is exported to Myanmar.

Semen Indonesia’s plant in Vietnam will supply Indonesia and other markets, Soetjipto said.

Overall, Southeast Asian companies are battling to be more competitive across borders as they prepare for the advent of the Asean common market in 2015, which will loosen restrictions on the transfer of goods and services across the region.

The company is in discussions with the Myanmar government about opening a factory with a 600,000 to 1 million ton annual capacity. Myanmar, which wants to develop rapidly but is doing so from a very low base, currently imports around half of the 6 million tons of cement it uses annually, Soetjipto said.

“It’s a test case before the real game begins for a bigger regional competition against the Thais because they also sell their products in Myanmar,” he said.

Siam Cement, Thailand’s top industrial conglomerate, plans to invest $900 million over the next three years to build cement plants in Myanmar, Cambodia and Indonesia.

Demand for cement in Indonesia, Southeast Asia’s biggest economy, was around 60 to 61 million tons in 2012 and the national cement industry association expects it to grow around 8 to 10 percent this year, led by infrastructure and property projects.

That demand is matched by local firms’ capacity but Semen Indonesia and other cement firms are adding capacity to prepare for future demand growth expected at around 7 percent over the next five years, Soetjipto said.

Semen Indonesia, which holds a 44 percent share of the domestic market, plans to build a new factory with 1.5 to 3 million ton capacity in North Sumatra. It is also studying a plan to build another factory in the east of Indonesia.

The company expects to buy a 70 percent stake currently owned by the government in cement maker Semen Baturaja after that company sells a 30 percent tranche in an initial public offering planned for this year.

Semen Indonesia expects to produce up to 29 million tons in 2013, an increase of 20 percent from last year, while its net profit is expected to rise around 15 percent in 2013, Soetjipto said.

Still, demand growth for cement in some parts of Indonesia fell in the first quarter of this year as a result of falling commodities prices in regions dependent on mineral exports.

“We’re a bit worried on the recent trend … the Sumatra region even suffered negative growth in March,” he said.

Semen Indonesia Takes on Vietnam Rival With Myanmar Expansion - The Jakarta Globe

 

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SATURDAY, 06 APRIL, 2013 | 00:32 WIB
Indonesia Unemployment Rate Down

TEMPO.CO, Jakarta - The International Labor Organization (ILO) says that in 2012, Indonesia’s unemployment rate declined from 6.32 percent in August 2011 to 6.14 percent in August 2012. The declining trend is expected to continue.

“Employment continues to exceed the growth of labor force,” ILO economist Emma Allen told reporters at Sari Pan Pacific Hotel in Jakarta on Thursday, April 4. Allen added that last year there were 1.13 million new job openings in Indonesia. The ILO recorded that the country has a 118.08-million strong workforce, out of the total population of 244.75-million.

Throughout the period of August 2011 and 2012, the unemployment rate declined in almost all provinces except Aceh and Southeast Sulawesi. Over the period, Aceh showed an increase in the unemployment rate from 7.43 percent to 9.1 percent, while in Sulawesi the figure climbed from 3.06 percent to 4.04 percent.

PINGIT ARIA

Indonesia’s Unemployment Rate Down | Economy & Business | Tempo.Co :: Indonesian News Portal

 

[Reashot Xigwin]

Construction to start on Timika steam power plant this month
The Jakarta Post, Timika, Papua | Archipelago | Fri, May 03 2013, 6:50 PM


The construction of a 28-megawatt steam power plant (PLTU) in Timika, Papua, is scheduled to start later this month, an official of state electricity company PT PLN said Friday.

“Hopefully, the groundbreaking for the construction of the project will be held this month,” Semuel Farwas, manager of PLN’s Timika office, said as quoted by kompas.com.

According to Semuel, some of the materials for the project had been delivered to the site in Mimika Timur Jauh district, while other materials were on the way from Surabaya, East Java.

The power plant is estimated to take 19 months to construct at a cost of about Rp 1 trillion. Construction of the plant on a 10-hectare plot of land will be carried out by PLN and PT Rekadaya Elektrikal.

The plant site used to be utilized by copper mining company PT Freeport Indonesia as a port to store explosive materials.

Semuel said that by 2014, the first of the four units of the plant was expected to be operating and generating 7 megawatts of electricity, followed by another unit every three months.

“If the four units of the plant produce a total capacity of 28 megawatts, it is expected to help meet electricity demands in Timika,” said Semuel.

Timika currently has 26,000 customers that consume around 20 megawatts of electricity. PLN provides 18 megawatts from its

diesel-fueled power plant. The remainder is met by generators rented from PT Manunggal and PT Sewatama . (nai)

Construction to start on Timika steam power plant this month | The Jakarta Post

 

[Reashot Xigwin]

Subsidized Apartment Blocks for the Have-Nots in South Jakarta
By Deti Mega Purnamasari on 2:57 pm May 11, 2013.

Jakarta Governor Joko Widodo said the construction of the block in South Jakarta will start next month and the bidding process to determine contractors is still in progress. (JG Photo/Safir Makki)

Jakarta will build new subsidized apartment blocks in South Jakarta as the city aims to overcome housing problems, zoning issues and traffic congestion.

The provincial administration will build low-rise apartment blocks, known as kampung deret (tiered villages) in Petogogan, South Jakarta.

Governor Joko Widodo, said the construction of the block will start next month and the bidding process to determine contractors is still in progress.

The project will be funded under the provincial budget, making it the first project of its kind to be supported that way. The cost of the enterprise was not immediately known.

The kampung deret will replace the semi-permanent houses on the banks of rivers to overcome crowding and flooding. A similar project called kampung susun (vertical villages) will allow former slum-dwellers to remain in their current areas, but in better-organized housing.

Joko said the tiered village in Petogogan will accommodate 262 families totaling 900 people currently residing in the area who have already agreed to the project, he told reporters on Friday.

The government will compensate citizens with Rp 1.5 million ($154) per square meter for their current semi-permanent houses. Beneficiaries must each arrange where they will move temporarily while the construction takes place. Joko said communications with Petogogan residents would be maintained and he would closely observe the process.

The buildings will have a well-designed drainage system and public facilities such as parks and a library. The buildings will also be integrated around existing transportation and retail hubs, to provide easier access for residents to commute to workplaces.

The administration started the construction of a similar project in Tanah Tinggi, Central Jakarta, last week, with. 85 housing units being constructed in a product scheduled for completion within three months.

Petogogan, in Kebayoran Baru, is frequently flooded during the rainy season.

The plan has been welcomed by some locals as a way to help people disproportionately afflicted by flooding.

The Jakarta governor has pledged to provide better housing and drainage systems to prevent major flooding in the capital.

In addition, the administration has laid out programs to dredge waterways in order to prevent rivers from bursting their banks, and to increase the space available for water catchment areas.

Subsidized Apartment Blocks for the Have-Nots in South Jakarta - The Jakarta Globe

 

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Indosat Invests US$ 250 M for Palapa-E Satellite
BY CORRY ANESTIA

PT Indosat Tbk. Satellite Command Centre. Daan Mogot, Java, Indonesia.

JAKARTA – Telecommunication (telecom) issuer PT Indosat Tbk (ISAT) allocates US$ 200 million to US$ 250 million to launch new satellite, Palapa-E, to replace Palapa-C2 satellite of which orbital period expires by 2014. The company collaborates with Orbital Sciences Corporation, US-based outer space technology company.

PT Indosat’s President Director & CEO Alexander Rusli said Palapa-E satellite is planned to occupy Palapa-C2 satellite orbit in 150.5°E slot by 2016. The fund is allocated for design cost, production and satellite launching. The company now is currently in the process of designing the satellite.







Indonesia Leads Social Shopping Trend in SEA
BY APRILLIA IKA

JAKARTA – Indonesia becomes the leader of online shopping trend through social media or social shopping, according to a research of Rakuten Inc’s E-Commerce Index. Globally, Indonesia’s social shopping trend rose by two-fold from world’s trend hike. In Southeast Asia, Indonesia leads social shopping trend index by 78 percent.

E-Commerce Index shows consumer’s interest in social shopping rose across the globe. Rakuten’s survey included five European countries, US, Brazil, Taiwan, Japan, Indonesia, Thailand and Malaysia.

 

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Indonesia’s 18% Car Sales Growth Defies Slowdown Talk
By Abdul Muslim

Honda and Suzuki were the car brands that posted the strongest growth during the first four months of the year, though off a low base.

Car sales in Indonesia grew by 18 percent in the first four months this year compared to the same period in 2012, with smaller brands like Honda and Suzuki posting the fastest growth.

The figures mean that this year’s growth is matching that achieved last year, despite fears expressed by the industry earlier this year that 2013 growth would be flat..

Some 397,991 units were sold in the January to April period, according to preliminary data from the country’s car distributors acquired by Investor Daily.

Jonfis Fandy, marketing director at Honda Prospect Motor, said carmakers introduced new models and face-lift versions early this year and also introduced efficient fuel consumption in a bid to prop up sales amid tighter auto-financing rules, higher production costs due to wage increases, expensive imported materials and a subsidized fuel price increase. “New products have been well-received by consumers. We hope this trend continues in the following months,” Jonfis said on Monday.

Honda’s sales rose 182 percent to 33,479 units in the first quarter but the brand remains in a distant fifth place in terms of market share.

Toyota led sales in January to April with 143,667 cars, up 10 percent from the same period last year. It currently holds 36 percent of the car market share.

Daihatsu followed in second place with sales of 57,623 cars, up 7 percent from last year. Toyota and Daihatsu are both brands under Astra International.

Mitsubishi ranked third with 52,411 cars sold, up 8 percent from last year, while sales at Suzuki Indomobil Motor jumped 78 percent to 49,839 cars.

“With these figures, we are likely to reach 1.1 million car sales this year, as targeted,” Widyawati Soedigdo, general manager for corporate planning at Toyota Astra Motor, said on Monday. TAM is the sole agent for the Japanese car maker and a subsidiary of Astra International.

Indonesian Automotive Industry Association (Gaikindo) previously predicted that automotive sales would remain steady at around 1.1 million cars this year, matching last year’s result.

“As with the last subsidized fuel price increase in 2006, we expect the impact to be temporary and indirect on car sales,” Widyawati said. “On the other hand, tighter Islamic financing regulations will have a bigger impact.”

More than two-thirds of car purchases are made on credit. Bank Indonesia last year increased the minimum down payment required for commercial bank loans for car and motorcycle purchases and subsequently implemented the policy on Islamic banks to prevent arbitrage.

For cars, the minimum down payment was increased to 30 percent of the selling price, while the requirement for motorcycles was raised to 25 percent.

Sales could to rise 7.5 percent 1.2 million this year, should car makers introduce low-cost and energy-efficient cars this year, said Vivek Vaidya, vice president of automotive and transportation practice at consulting group Frost & Sullivan.

Indonesia's 18% Car Sales Growth Defies Slowdown Talk - The Jakarta Globe

 

[Nusantara]

That traffic, crazy

 

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Indonesia's Pertamina Invest U.S. $ 7.8 Billion For PSC MNK Sumbagut

Pertamina president director, Karen Agustiawan (right) di World Economic Forum

CIN- PT Pertamina (Persero) Unconventional oil and gas PSCs signed Sumbagut, worth U.S. $ 7.8 billion. This first MNK PSC makes Pertamina as pioneer. “We expect this to be the signing of the PSC MNK good momentum for the future development of alternative energy, Shale Gas primarily in Indonesia, which has a large resource. Later, Shale gas could support the government to diversify its energy so that dependence on oil can be reduced. MNK Sumbagut will be prioritized for domestic supply, especially North Sumatra,” said Pertamina President Director Karen Agustiawan, pada penandatanganan di Forum The 37th IPA Convention and Exhibition 2013, (15/5/2013) .

According to the woman's role in the world's oil and gas sector, since 2011 Pertamina has proposed investing MNK Sumbagut. Government initiated a joint study team.

MNK Sumbagut contain shale gas in the amount 18,56 trillion cubic feet. Initial production target in year 7. Production levels 40- 100 MMscfd. Operated PT PHE MNK Sumbagut.
The amount of domestic gas demand and gas depletion potential Indonesian government move to make efforts to increase the supply of domestic gas. Government conduct studies to determine the potential of unconventional oil and gas in Indonesia shale gas potential 574 TCF dan CBM 453 TCF.

Government issued Regulation No..05 date 31 January 2012 on "Determination Procedures and Work Area Offers Oil and Gas Non-Conventional", KKKS conventional oil and gas and CBM PSCs have the potential Unconventional Oil and Gas in the existing work has proposed concession privilege for Unconventional Gas in the region.Understanding Unconventional Gas in accordance with Regulation No. MNK singkatann.05 Year 2012 Oil and Gas is cultivated from the reservoir formation where oil and natural gas with low permeability (low permeability).

Pertamina Invest U.S. $ 7.8 Billion For PSC MNK Sumbagut | Citra Indonesia



Wed, 05-15-2013 09:38 WIB
Indonesia's Debt-to-GDP Ratio Decreases from 57 Percent (2004) to 24.1 Percent (2012)
By : the Information Desk

Presidential Special Staff for Economy and Development Prof. Firmanzah Ph.D. stated that debt is a part of fiscal policies (state budget or APBN) and a part of Policies on Economic Management as a whole. Fiscal deficit shall always be kept below 3 percent of Gross Domestic Product (GDP) to be safe for national economy.

“This factor makes Indonesia’s economy immune from Subprime Mortgage crisis and Europe’s debt crisis,” Firmanzah said in Jakarta on Friday afternoon (10/5).

According to the University of Indonesia’s Professor of Economics, since 2004, the Government has prioritized domestic debts over foreign debts. During 2004-2012 periods, fiscal and debt management continually showed steady improvement in national economic fundamentals.

“As the result, Indonesia’s debt-to-GDP ratio decreases from 56.6 percent in 2004 to 24.1 percent in the end of 2012,” Firmanzah exposed. According to Firmanzah, in 2013, SBY’s government will keep the debt-to-GDP ratio below 23 percent. President even gives instruction to keep the debt-to-GDP ratio at about 22 percent in 2014.

“Compare our debt-to-GDP ratio with the debt-to-GDP ratio in Euro zone which reaches 90 percent on average, for example Greece (152.6 percent), Italy (127.3 percent), Portugal (120.3 percent), or Ireland (117.0 percent),” Firmanzah revealed.

The Presidential Special Staff for Economy and Development also stated that Indonesia’s Gross Domestic Product (GDP) grow positive at about 6 percent and continually grow bigger from IDR 2.294 trillion in 2004 to IDR 8.241 trillion in 2012.

The value of Indonesia’s GDP in 2025, Firmanzah continued, is targeted to range between USD 4.0 – 4.5 trillion. Thus, at that time, Indonesia will be classified as a developed country.

No Loan Application

Meanwhile, Cabinet Secretary Dipo Alam via his twitter account @dipoalam49 on Friday afternoon (9/5) announced that in the Plenary Cabinet Meeting on Wednesday (8/5), President Susilo Bambang Yudhoyono (SBY) warned all ministries and all non-ministerial government institutions not to launch programs financed through loans.

Cabinet Secretary continued that the warning is only one of President’s many previous ones. He reminded them that Cabinet Secretary Circular Letter Number SE-592/Seskab/XI/2012 dated 1 November 2012 already mentions President’s directives issued in cabinet meetings from 20 July to September 2012 (there are totally 9 directives). Through such directives, President SBY instructs all ministries and all non-ministerial government institutions to review comprehensively all loan applications proposed to be accommodated in Blue Book processed by National Development Planning Agency (Bappenas).

Cabinet Secretary, through the Circular Letter addressed to all ministers of United Indonesia Cabinet II (KIB II) and all heads of non-ministerial government institutions, urges them to follow President’s directives.

“As national economy continually improves, and as our State-Owned Enterprises and private sectors succeed in increasing their power of financing for domestic and foreign investments, the proposals for such projects shall be reviewed in order to restrict the use of foreign debts. Thus, the classical thought about development “under the regime of foreign debts” shall be strictly limited and shall even be pushed away,” Cabinet Secretary said in the Circular Letter. (ES) (TM/S)

Pertamina in talks with Oman on ventures
Amahl S. Azwar, The Jakarta Post, Jakarta | Business | Fri, May 17 2013, 12:10 PM
A- A A+
Paper Edition | Page: 13

State-owned oil and gas firm PT Pertamina is in negotiations with Oman officials for the takeover of oil and gas assets in the Gulf state, expecting to seal an agreement by year’s end.

Pertamina president director Karen Agustiawan, however, refused to provide details on the ongoing talks.

“I am not allowed to disclose details before we sign the SPA [shares purchase agreement],” she told reporters at the Jakarta Convention Center in Senayan.

Karen revealed Pertamina’s plan in her speech before attendees of the 37th Indonesian Petroleum Association (IPA) conference — including visiting Oman Oil and Gas Minister Mohammed Hamad Al Rumhy.

With current oil output reaching around 200,000 barrels per day (bpd), Pertamina is presently the second-largest oil producer in Indonesia behind US giant Chevron,which has an output of more than 300,000 bpd.

Pertamina has attempted to buy oil and gas blocks overseas in the past to boost oil output but none of its major plans have panned out thus far.

In February, Pertamina failed to acquire a 32 percent stake in Venezuela’s Petrodelta from New York-listed Harvest after the Indonesian government dropped the move following a disagreement over an investment deal.

Last year, Pertamina also planned to buy a stake in Canada-based Coastal Energy, which has assets in several regions in Southeast Asia. Pertamina ultimately withdrew the plan following a disagreement over the purchasing price.

Separately, Al Rumhy said he was still in the dark over Pertamina’s plan to acquire assets in Oman but said his country was open to foreign oil and gas company operations.

In addition, he said Oman policy allowed foreign firms to receive oil entitlement although shares would differ from one contractor to another.

“The typical agreement is called a production-sharing agreement where the investor gets a certain portion of profits in the form of actual oil. There are many examples of that,” he said.

Oman, located in the Persian Gulf, is home to about 3 million people and while oil is the core of its economy, Oman is a modest oil producer compared to its neighbors. Oman’s average oil production including condensates in 2012 was 918,000 bpd, up 4 percent from its average oil production of 884,900 bpd in 2011.

In comparison, Indonesia, which currently produces about 830,000 bpd, is home to 240 million people.

Meanwhile, the country’s publicly listed PT Medco Energy Internasional is also planning to expand its presence in Oman. Currently in Oman, Medco operates its wholly owned Medco Oman LLC, which holds a 55 percent participating interest in Karim Small Fields.

In 2012, Medco increased oil production in Karim — owned by a joint venture between Oman-owned Petroleum Development Oman (PDO) and Royal Dutch Shell — to 22,400 bpd, a significant increase from the 9,000 bpd the field produced back in 2006 before Medco received the contract.

Medco president director Lukman Mahfoedz, currently the IPA chairman, confirmed he discussed Medco’s expansion plans with Minister Al Rumhy on the sidelines of the IPA convention.

“God willing, we can announce the deal this year,” he said.

Minister Al Rumhy said that Medco was indeed in negotiations to take more assets in Oman, citing that the assets would likely be located in Oman’s Block 56 or Block 51.

Shares in Medco, which is listed in Jakarta as “MEDC”, closed at Rp 2,100 on Thursday, increasing 3.7 percent from a day earlier.

 

[nufix]

New China-Indonesia Industrial Zone to be Inaugurated in Cikarang
By Jakarta Globe
Category Business

Indonesian people wave Chinese and Indonesian flags.

Beijing. A number of Chinese officials and business people are slated to visit Indonesia in June to inaugurate a new joint industrial zone in Bekasi, West Java.

The China-Indonesia Economic and Trade Cooperation Zone spans across 500 hectares of land in Bekasi’s industrial subdistrict of Cikarang.

“We will visit Indonesia in June 2013 to explore several investment opportunities, as well as inaugurate the China-Indonesia Economic and Trade Cooperation Zone in Bekasi,” Peng Qinghua, the chief of China’s Communist Party for the Guangxi Zhuang autonomous region, said on Monday, according to Indonesian news portal antaranews.com.

Peng made the statement while receiving visiting Indonesian ambassador to China and Mongolia Imron Cotan at his office in Guangxi.

“The economic and trade cooperation between China and Indonesia keeps on growing, and we will continue to explore various opportunities to further strengthen the partnership,” Peng added.

“To maintain [China’s] double-digit economic growth, in the future Guangxi will increase cooperation with Asean countries, especially Indonesia.”

New China-Indonesia Industrial Zone to be Inaugurated in Cikarang - The Jakarta Globe




PLN (States Electric Company) Building Recharging Stations for Electric Cars
By Jakarta Globe
Category Business, Corporate News, Featured

State-owned electricity firm Perusahaan Listrik Negara (PLN) on Monday said it had built two recharge stations for electric cars, and was set to build more in order to support the development of electric cars in the country.

PLN said the first two recharging stations were built in Yogyakarta to support the operation of electric minibus Hevina, which was developed by the Indonesian Institute of Sciences (LIPI) and launched on Monday.

“We built one in Taman Pintar and another one in Yogyakarta’s Giwangan [bus] Terminal,” the head of PLN’s Research and Development Center, Saftri Falani, said on the sidelines of the bus launch.

She added that PLN had also developed electric car prototypes to test the recharging stations.

“PLN doesn’t want to develop electric cars, though. We don’t intend to sell cars. Our business is in the recharging stations,” Saftri told Indonesian news portal republika.co.id.

She added that this year, PLN would focus on developing a business model for the recharging stations, which they aim to have several of by 2015.

The Indonesian government last year stepped up its support for the development of “low-cost green cars,” which include electric cars. The State Ministry for Research and Technology alone earmarked Rp 100 billion ($9.98 million) for the development of such cars by four state universities.

The ministry has also given LIPI Rp 1.2 trillion to develop electric vehicles, including the Hevina, which can carry up to 16 people and is intended to serve visitors of Yogyakarta’s Taman Pintar theme park.

Research and Technology Minister Gusti Muhammad Hatta told antaranews.com that his ministry has also developed its own electric minibus, two electric sedans and several electric golf cars.

“The ministry will keep developing electric vehicles. We already have a road map for their development. We’ll keep getting better every year,” Gusti said.

Indonesia-based firm Great Asia Link (Grain) said in February that it was planning to commence operations of the country’s first electric car plant in the East Java town of Gresik in May. The factory, Grain said, has an annual production capacity of 20,000 units.

State Electricity Firm PLN Building Recharging Stations for Indonesia-Made Electric Cars - Jakarta Globe