Indonesia Update: OJK Board of Commissioners' Selection Update

Indonesia Update | April 6, 2017
Authors: Kim Yaeger, Artha Sirait, Ian Saccomanno and Steve Prawiromaruto
 
LOOKING AHEAD
 
 
  • Digital Economy Industry Mission, April 26-27: The ICT and Financial Services Committees will be leading a group of technology and financial services companies to Indonesia for an industry mission covering digital economy issues. The registration page may be found here. Please contact Matt Solomon at msolomon@usasean.org for more information. Registration deadline is April 12
  • Advocacy Opportunity - US Embassy Jakarta: The US Embassy in Jakarta is providing an advocacy opportunity to get deals across the finish line. Please contact Andrew Billard, Commercial Attaché at the US Embassy in Jakarta at Andrew.Billard@trade.gov for further information regarding projects that could be submitted for review and potential support. General guidance being: (i) projects have been recently signed or realistically within sight of the finish line; (ii) strong US economic benefit is likely to be an important consideration and this may also be a good opportunity to push against trade barriers and/or unfair trade practices. 
 
THE COUNCIL'S TAKE
 
 

OJK Board of Commissioners Selection Update

President Jokowi has nominated 14 candidates for the Financial Services Authority (Otoritas Jasa Keuangan - OJK) commissioner positions out of the 21 names previously submitted by Finance Minister Sri Mulyani Indrawati. Their names will now be submitted to the House of Representatives for confirmation hearings. The hearings, conducted by the House of Representatives’ Commission XI, which supervises fiscal policy and the financial sector, is expected to be finalized by June 6, with the new commissioners sworn in on July 20. All of the seven incumbent commissioners participated in the selection, but only Nurhaida made it to the final round. The OJK has nine commissioners, seven of whom will be selected from the 14 candidates, while two others are representatives of Bank Indonesia and the Finance Ministry. The final 14 candidates are: Wimboh Santoso, Sigit Pramono (Chairman Position); Agus Santoso, Riswinandi (Vice Chairman Position); Heru Kristiyana, Agusman (Head of Banking Oversight Position); Nurhaida, Arif Bahardin (Head of Capital Markets Oversight); Edy Setiadi, Hoesen (Head of Insurance, Pension Funds, Financing Institution and other Finance Services (Non-Banking Institution) Oversight Position); Haryono Umar, Ahmad Hidayat (Head of Audit Board Position); Tirta Segara, Firmanzah (Head of Education and Consumer Protection). Please click here for the official announcement. 

President Trump’s Executive Order on Trade Imbalance, including Indonesia

President Trump has signed an executive order calling for an investigation in the trade imbalance between the U.S. and 16 countries, including Indonesia. Indonesia is placed 15th on the list with a USD13 billion trade surplus over the U.S.

For example, previously in late March, the National Biodiesel Fair Trade Coalition on behalf of U.S. biodiesel producers asked the U.S. government to impose antidumping duties in imports of biodiesel from Indonesia, claiming that it has flooded the U.S. market and violated trade agreements. Such petition was filed by the ad hoc coalition association consisting of the National Biodiesel Board and 15 companies, claiming to have acted on behalf of U.S. biodiesel producers. The National Biodiesel Board stated that soaring imports have threatened the profitability of domestic products in the past couple of years.  

Indonesia has been eager to boost its production of biodiesel both for its domestic consumption and export for the past few years. The type of biodiesel that Indonesia produces is made by blending diesel with palm oil and because Indonesia is the one of the biggest crude palm oil producers in the world, its biodiesel could be processed at relatively cheaper costs which can then be sold at relatively low prices. It has been claimed that the rise of Indonesia’s biodiesel consumption could also be attributed to its biodiesel subsidy, which is financed through a levy on palm oil and palm oil export products. The Indonesian Trade Ministry has received notification of the petition as well as a questionnaire of “injury determination” from U.S. trade authorities, and will officially respond in early April.

Indonesia's Vice President Jusuf Kalla has voiced his strong objection in response to President Trump’s executive order. Meanwhile, Trade Minister Enggartiasto Lukita stated that the government would closely monitor the situation and evaluate what exports could potentially be questioned by the U.S.

 
 
IN THIS UPDATE
 
 

Regional Affairs
Indonesia closely monitoring US trade policy
Indonesia authorities destroy 81 foreign ships for illegal fishing
Indonesia-European trade talks on track; to conclude this year
France pledges $2.6 billion for Indonesia as Hollande visits

National Affairs
Jokowi Calls on Ministers to Simplify Investment Rules
Indonesia's tax amnesty fails to bring money home
Trump puts Indonesia on trade hit list
Sri Mulyani launches special office for prominent individual taxpayers
Jokowi nominates 14 OJK commissioner candidates
Indonesia’s Fearless Finance Minister Is Ready for Her Next Fight
Three stages of development necessary to realize 2045 vision: President
President Jokowi approves new recruitment of 1,800 judges
Golkar Supports Jokowi for 2019 Election: Setya Novanto
Jokowi Highlights Promising Business Sectors
Indonesia to be world's 4th largest economy by 2045: Jokowi

Defense & Security
Indonesia to barter French weapons with rubber
France says Indonesia signs tentative deal to buy A400M
Indonesia, Brazil sign MoU on defense cooperation

Economics
Indonesia president says he targets 5.6 pct GDP growth in 2018
Indonesia experiences 0.02 percent deflation in March

Energy
Fuel Prices Won't Increase Until June: Energy Ministry  
Pertamina Aims to be Oil Self-sufficient by 2023
Government, nine regions agree to boost household gas distribution
Regions told to draft energy plans
Six firms to construct solar energy power plants
PLN and French companies sign agreements on renewable energy development
Ask to Lower Industrial Gas Prices, Jokowi Considered Irrational
Non-subsidized electricity prices won’t increase
Indonesia lodges complaint with WTO over US biodiesel anti-dumping duties
Data from Indonesian oil, gas fields to be accessible online
Indonesia Pays Price of Protectionism as Commodity Exports Sink

Financial Services
OJK Encourages Banks to Partner With Tech Companies to Provide Better Services
Indonesia sells 18.65 trln rupiah bonds at auction, above target
Banking transparency regulation to be submitted to Jokowi next week

Food & Agriculture
Plunging agriculture share to GDP major concern for policymakers
Coffee Prices Fall in Indonesia on Harvest, Vietnam Exports Seen Lower
Indonesia to export rice to Malaysia
President asks KPPU to watch competition in food business
Indonesia potential to become world`s largest gastronomy country
Palm oil producers revise up palm oil production, stock data
Contributions from Agriculture Sector Remain Low
Indonesia's rice self-sufficiency to be achieved by 2020
Environmental damage, social conflicts overshadow Indonesia’s palm oil future

Health & Life Sciences
Indonesia Integrates Human Rights in HRD of Health Sector  
Indonesia seeks to ease import of raw materials for pharmaceutical industry

ICT
RI to push for G20 working committee on digital economy
Indonesia's Anti-Monopoly Body Slams Gov't's New Online Transport Rule
ICT Ministry to Block Online Access to Rogue Ride-Hailing Apps

Infrastructure
Government launches scheme to fund land acquisition for infrastructure projects
Government Provides Capital Injection for Infrastructure Projects
World Bank approves new loan for Indonesian infrastructure
Japan selected as partner for Jakarta-Surabaya railway project

Manufacturing
Manufacturing Industry Produces More in March, Optimistic About Year Ahead
Indonesia car sales rise 7.5 pct y/y in February
Garment exports projected to stagnate this year

 
ARTICLE CLIPS
 
 
Regional Affairs

Indonesia closely monitoring US trade policy Antara News 4th Apr 2017
The government has been closely observing the implications of the US trade policy following President Donald Trumps executive order to investigate the trade imbalance between the US and some partner countries.

Indonesia authorities destroy 81 foreign ships for illegal fishing Fox News 2nd Apr 2017
Indonesian authorities destroyed 81 foreign ships over the weekend after seizing the vessels for fishing illegally in the country's waters. The world's largest archipelago nation has taken a tough stance against illegal fishing since President Joko "Jokowi" Widodo took office in 2014. Authorities have sunk 317 foreign vessels since then, including the most recent. The ships were blown up at sea in 12 locations around the archipelago on Saturday. The most destroyed in one area was 26 in Natuna on the edge of South China Sea and 10 in the nearby seaport of Tarempa. Most of the vessels were from Vietnam, the Philippines, Malaysia and Thailand.

Indonesia-European trade talks on track; to conclude this year The Jakarta Post 30th Mar 2017
Indonesia has said talks on forming a comprehensive economic partnership agreement (CEPA) with the European Free Trade Association (EFTA) are on the right track. The twelfth round of negotiations are taking place from March 28 to 31 in Geneva, Switzerland.

France pledges $2.6 billion for Indonesia as Hollande visits Charlotte Observer 29th Mar 2017
France pledged $2.6 billion in investments for Indonesia and affirmed deepening ties with Southeast Asia's biggest economy during a visit Wednesday by President Francois Hollande. Indonesian President Joko "Jokowi" Widodo welcomed the new commitment by French investors to increase their involvement in the energy, infrastructure and retail industries. Jokowi and Hollande witnessed the signing of five memorandums of understanding covering defense, sustainable urban development, research, technology and tourism, and also agreed to increase cooperation on maritime issues, fisheries and creative industries such as film and fashion.

National Affairs

Jokowi Calls on Ministers to Simplify Investment Rules Jakarta Globe 4th Apr 2017
President Joko "Jokowi" Widodo says there are several regulations that must be simplified to encourage more investment in Indonesia. Speaking during a cabinet meeting scheduled to discuss the 2018 draft state budget at the Presidential Palace in Central Jakarta on Tuesday (04/04), Jokowi called on ministers to eliminate all complicated regulations he called "diseases."

Indonesia's tax amnesty fails to bring money home- Nikkei Asian Review 3rd Apr 2017
JAKARTA -- Indonesia's tax amnesty, which came to an end Friday, has exposed the massive scale of uncollected tax from its citizens, who declared at least 4,866 trillion rupiah ($365 billion) in hidden assets during the nine-month program. But the total of overseas assets brought home was far below the government's target, dealing a setback to its infrastructure development plans. People crowded tax offices in major cities across Indonesia from Friday morning as the deadline loomed. At the headquarters of the tax directorate general in Jakarta, at least 1,000 people waited to submit documents to the staff, many of whom would work through the night to accommodate last-minute applicants. Finance Minister Sri Mulyani Indrawati paid the place a visit late in the evening, saying she was "satisfied" with the hard work of the entire tax office ranks despite lower-than-expected participation.

Trump puts Indonesia on trade hit list The Jakarta Post 3rd Apr 2017
A week after seeing a petition against Indonesia’s biodiesel, the country has seen another blow in its trade with the United States after President Donald Trump called for an investigation into the “trade imbalance” between the US and 16 countries, including Indonesia. Trump had promised to crack down on “cheating foreign importers” by signing two executive orders on Friday. He gave 90 days for his administration to develop and implement a strategy for combating “violations of US trade and customs laws.”

Sri Mulyani launches special office for prominent individual taxpayers The Jakarta Post 2nd Apr 2017
Finance Minister Sri Mulyani Indrawati has launched a new Large Tax Office (LTO) to serve prominent taxpayers in a move seen as an improvement in service. The new LTO building, named after one of Indonesia's founding fathers Radjiman Wedyodiningrat, is located on the busy Jl. Sudirman in the heart of the city's central business district. It hosts a number of district branches and a Jakarta regional branch that were once housed in separate offices in various locations.

Exclusive: Indonesia eyes decree on tobacco after bill runs into opposition Reuters 30th Mar 2017
The latest proposal was mooted at a meeting 10 days ago between the trade minister, the law minister and senior parliamentarians, two people who attended told Reuters on condition of anonymity. The government has not given details of the meeting.

Jokowi nominates 14 OJK commissioner candidates The Jakarta Post 29th Mar 2017
President Joko “Jokowi” Widodo has nominated 14 candidates for Financial Services Authority (OJK) commissioner positions. Their names will be submitted to the House of Representatives so it can continue the selection process by holding confirmation hearings. The OJK has nine commissioners, seven of whom will be selected from the 14 candidates, while the two others are representatives of Bank Indonesia and the Finance Ministry. Each of seven posts on the OJK’s board of commissioners was filled by two names as stated in a presidential letter signed by Jokowi that was circulated on Wednesday.

Indonesia’s Fearless Finance Minister Is Ready for Her Next Fight Bloomberg.com 28th Mar 2017
The mood at the meeting should have been tense. Seventy bank analysts gathered in January at the Indonesian Ministry of Finance, a sprawling stylistic mix of art deco and 19th century East Indies colonial, and made their way to a tower dubbed “the devil’s building” for the hexagram formed by its blue-tinted windows.

Three stages of development necessary to realize 2045 vision: President Antara News 27th Mar 2017
Three stages of national development will be needed to realize the Indonesia 2045 Vision, President Joko Widodo (Jokowi) stated here on Monday. The implementation of the three stages of development will be carried out in three 10-year periods, he noted before the 16th National Working Meeting of Indonesian Young Entrepreneurs.

President Jokowi approves new recruitment of 1,800 judges Antara News 27th Mar 2017
President Joko Widodo has approved recruitment of 18,000 new judges to make up for shortage over the past seven years. "The President has given the approval to the Minister of Administrative and Bureaucratic Reform (PAN/RB). There is no longer problem for recruitment," General Chairman of the Indonesian Judges Association (IKAHI) Suhadi said at the presidential palace here on Monday.

Golkar Supports Jokowi for 2019 Election: Setya Novanto Tempo 27th Mar 2017
Functional Group Party (Golkar) chairman Setya Novanto said that his party has been set to support President Joko Widodo or Jokowi for a reelection in 2019, as a survey showed that 68 percent of the people viewed the government programs favorably. "Golkar fully supports the government, so we need to support Jokowi for a reelection in 2019," Setya said during an inauguration of Golkar's regional executive board in Makassar, South Sulawesi, on Sunday night, March 26, 2017.

Jokowi Highlights Promising Business Sectors Tempo 27th Mar 2017
President Joko Widodo, also known as Jokowi, said that there are three business sectors that can be explored by young entrepreneurs, including tourism. Jokowi asserted that Indonesia has a strong tourism business. Jokowi said that currently, the government is developing 10 new tourist destinations and young entrepreneurs can help by developing its supporting facilities, such as opening restaurants or gift shop.

Indonesia to be world's 4th largest economy by 2045: Jokowi The Jakarta Post 27th Mar 2017
President Joko “Jokowi” Widodo has expressed his optimism that Indonesia will become the world’s fourth largest economy by 2045. He said the predication was based on calculations made by the Office of the Coordinating Economic Minister, the Finance Ministry and the National Development Planning Board (Bappenas).

Defense & Security

Indonesia to barter French weapons with rubber The Jakarta Post 31st Mar 2017
Indonesia will not solely use cash to pay for its purchase of French-made weaponry but also use commodities such as rubber. Under a defense agreement signed between the French defense ministry and Indonesian Defense Ministry on Wednesday, the two countries will work on maritime security, antiterrorism efforts and military equipment.

France says Indonesia signs tentative deal to buy A400M Reuters 29th Mar 2017
The provisional agreement was signed during a visit by Hollande to Indonesia and covers an unspecified number of aircraft, according to a list of deals issued by his office. If completed, it would provide the troubled European military programme with a second export customer after Malaysia.

Indonesia, Brazil sign MoU on defense cooperation Antara News 28th Mar 2017
Indonesian Defense Minister Ryamizard Ryacudu and his Brazilian counterpart, Raul Belens Jungmann Pinto, signed a memorandum of understanding (MoU) to strengthen defense cooperation. Ryacudu signed the document in Jakarta on Thursday in the presence of the Brazilian ambassador to Indonesia Rubem Antonio Correa Barbosa as a representative of the Brazilian government. The document of cooperation agreement would later be transferred to Brazil to be signed by Pinto.

Economics

Indonesia president says he targets 5.6 pct GDP growth in 2018 NASDAQ.com 4th Apr 2017
Indonesian President Joko Widodo said on Tuesday he wants economic growth to reach 5.6 percent in 2018, up from this year's official target of 5.1 percent.

Indonesia experiences 0.02 percent deflation in March The Jakarta Post 3rd Apr 2017
Indonesia experienced deflation of 0.02 percent in March because of a harvest season that helped push down prices of several major food commodities, bringing annual inflation to 3.63 percent, the Central Statistics Agency (BPS) reported on Monday. It was the first deflation this year after the inflation rate of Southeast Asia's largest economy rose 0.97 percent in January and 0.23 percent in February. BPS head Suhariyanto said the deflation in March was a little outside of expectations as Bank Indonesia (BI) previously predicted inflation at 0.05 percent and several analysts also forecast a low inflation rate.

Energy

Fuel Prices Won't Increase Until June: Energy Ministry   Tempo 1st Apr 2017
After monitoring the average price of global oil, the Energy and Mineral Resources Ministry ensured that between 1 April until 30 June this year, the government will increase the price of fuel. The ministry also said the government decided not to raise the price in order to main economic and social stability, price and logistic management stability, as well as to ensure the supply of fuel nationwide.

Pertamina Aims to be Oil Self-sufficient by 2023 Tempo 31st Mar 2017
State-owned oil and gas company Pertamina is aiming to be oil self-sufficient by 2023. Therefore, the company will be focusing on developing new oil fields to reduce dependency on crude oil and fuel imports.

Government, nine regions agree to boost household gas distribution The Jakarta Post 30th Mar 2017
The central government and nine regional administrations have agreed to boost gas distribution for household use. The agreement was signed on Wednesday by the Energy and Mineral Resources Ministry’s oil and gas director general, IGN Wiratmaja Puja, and representatives of Banyuasin, Penukal Abab Lematang Ilir and Muara Enim in South Sumatra, Bandar Lampung in Lampung, Mojokerto in East Java, Pekanbaru in Riau, Samarinda and Bontang in Eat Kalimantan as well as Jakarta.

Regions told to draft energy plans The Jakarta Post 30th Mar 2017
Regional governments must immediately draft their regional energy plans (RUED) as a follow up to a similar document at the national level – the national energy plan (RUEN) – that has already been signed by President Joko “Jokowi” Widodo.

Six firms to construct solar energy power plants The Jakarta Post 30th Mar 2017
Six firms have signed an agreement with state-owned electricity company PLN to develop electricity plants using solar energy with  total capacity of 45 megawatt (MW). The six companies are Delapan Menit Energi, Infrastruktur Terbarukan Adhiguna, Infrastruktur Terbarukan Buana, Infrastruktur Terbarukan Cemerlang, Infrastruktur Terbarukan Lestari and PT Quantum Energy. The government is revising electricity procurement business plan (RUPTL) 2017 to 2025 as part of an effort to boost renewable energy usage, said Energy and Mineral Resources Minister Ignasius Jonan, adding that the target was 23 percent renewable energy contribution to the country’s electricity demand by 2015.

PLN and French companies sign agreements on renewable energy development Antara News 30th Mar 2017
The Indonesian State-owned electricity company PT PLN and a number of French companies signed here on Wednesday a memorandum of understanding on development of renewable energy (EBT) in Indonesia.

Ask to Lower Industrial Gas Prices, Jokowi Considered Irrational Tempo 29th Mar 2017
Executive Director of ReforMiner, an independent research agency, Komaidi Notonegoro, claims that President Joko Widodo or Jokowi has yet to personally observe the oil and gas upstream sector when the President requested to lower the industrial gas prices.

Non-subsidized electricity prices won’t increase The Jakarta Post 27th Mar 2017
Energy and Mineral Resources Minister Ignasius Jonan has confirmed that non-subsidized electricity prices will not increase until June, in line with the government’s vow to maintain affordable prices for the people. “The President has ordered not to raise the price of electricity every year or every three months. This means that from April until June, electricity prices will not go up,” he said over the weekend. Jonan said the government was sure of its decision as it had issued several new regulations that would hopefully keep prices low.

Indonesia lodges complaint with WTO over US biodiesel anti-dumping duties The Jakarta Post 27th Mar 2017
Trade Minister Enggartiasto Lukita has said the government has already submitted a complaint to the WTO over a petition issued by the US Department of Commerce and the US International Trade Commission to impose anti-dumping and countervailing duties on imports of biodiesel from Indonesia. “Of course we feel that this is a disadvantage for us. We have already lodged our complaints with the WTO,” he said at the Ritz Carlton Hotel in Jakarta on Monday. The petition to apply such duties in the US was submitted by the US-based National Biodiesel Board (NBB). The NBB has followed the European Union (EU), which in 2013 increased duties from 8.8 percent to 20.5 percent for Indonesian producers and between 22 percent and 25.7 percent for Argentine producers, to apply for five years in both cases.

Data from Indonesian oil, gas fields to be accessible online The Jakarta Post 6th Apr 2017
Indonesia will follow the step of other countries like Mexico, Norway and Australia that make their oil and gas field data are accessible online by registered viewers, said Energy and Mineral Resources Ministry’s oil and gas director general IGN Wiratmaja Puja. The open data system would be implemented through a ministerial decree that is expected to be issued this year. "Right now, if a company is interested in one of Indonesia's fields it must come here to sign up and buy the data. With the new decree, the government selects which data will be open and which will remain classified," Wiratmaja told reporters on Wednesday evening.

Indonesia Pays Price of Protectionism as Commodity Exports Sink Bloomberg 28th Mar 2017
Indonesia’s economy is losing out on commodity gains after lawmakers wrapped protectionist policies around the nation’s resources. Their next problem: finding a lucrative replacement. Commodities now account for about 40 percent of all exports, down from almost 60 percent five years ago, according to Morgan Stanley. They make up just 6 percent of gross domestic product, half as much as in 2012, as trade restrictions worsened the impact of a price rout over much of that period. Crude oil and gas output has declined to levels last seen in the early 1970s. While Indonesia’s coal output will be higher next year than in 2013, production of key mineral exports including bauxite, tin and nickel will still be well behind the commodity cycle’s peak, BMI Research estimates. The drag on activity may complicate President Joko Widodo’s plans to accelerate economic growth to 7 percent, with an investment push in manufacturing to offset lost commodity income yet to yield results. While global commodities slumped for five years following their 2011 peak, last year saw a rebound in prices. But investment in Indonesia’s sector has been sapped by tighter environmental rules and nationalist policies, including import tariffs and tighter visa requirements for foreign workers. The crackdown has led to mine closures and the exit of big foreign resource companies. Indonesia halted the export of metal ores in 2014 to encourage local smelter construction; despite relaxing the ban in January, shipments of nickel have yet to restart. There may be a silver lining to relying less on commodities, says Wellian Wiranto, an economist at Oversea-Chinese Banking Corp. in Singapore. Less dependence should be a mid-term positive for the economy as it forces government and business to find other growth drivers, says Wiranto. 

Financial Services

OJK Encourages Banks to Partner With Tech Companies to Provide Better Services Jakarta Globe 4th Apr 2017
Indonesia's Financial Services Authority, or OJK, is encouraging lenders to cooperate with technology companies to offer better access to online banking services for the public, a senior official said on Monday (03/04).

Indonesia sells 18.65 trln rupiah bonds at auction, above target NASDAQ 27th Mar 2017
Indonesia sold 18.65 trillion rupiah ($1.40 billion) of bonds at an auction, above the indicative target of 15 trillion rupiah, the finance ministry's financing and risk management office said on Monday. The T-bills maturing in June 2017 had a weighted average yield of 4.99664 percent, lower than 5.10944 percent at the last auction on Mar. 14.

Banking transparency regulation to be submitted to Jokowi next week The Jakarta Post 5th Apr 2017
Coordinating Economic Minister Darmin Nasution has said the draft of a regulation in lieu of law (Perppu) concerning banking transparency will be submitted to President Joko “Jokowi” Widodo next week. One of the aspects of the regulation considered urgent is a provision that would allow the tax authority to access taxpayers’ bank data. “We are in the process of finishing the draft. It will be completed on Monday [April 10],” said Darmin as reported by kompas.com on Wednesday.

Food & Agriculture

Ministry issues regulation to address chicken oversupply The Jakarta Post 31st Mar 2017
The Agriculture Ministry has issued a ministerial decree to address the oversupply of chicken, which has sparked complaints by businesspeople about decreasing  prices of the commodity. The regulation reduces the supply of day old chickens (DOC), the ministry’s livestock and animal health director general, I Ketut Diarmita, said on Thursday.

Plunging agriculture share to GDP major concern for policymakers The Jakarta Post 31st Mar 2017
The persistent decline in the contribution of the agriculture sector to the gross domestic product (GDP) has been a key concern for policymakers, an official has said. The share of the agriculture sector to the GDP fell to only 13.45 percent last year from 22.09 percent in 1990 as massive conversion of land traditionally used for farming to other purposes and poor advancement in farming methods have prevented much of the country’s population from becoming farmers, Bank Indonesia (BI) said in reference to data from the Central Statistics Agency (BPS).  

Coffee Prices Fall in Indonesia on Harvest, Vietnam Exports Seen Lower Jakarta Globe 30th Mar 2017
A small harvest in Indonesia dragged prices of coffee beans down, while the market in Vietnam remained quiet amid low supply and thin stockpile, traders said on Thursday (30/03). Traders in Indonesia quoted robusta grade 4, 80 defects at a discount of $25 a ton to the London's ICE May contract, wider than last week's discount of $5-$10, as a small harvest boosted supply.

Indonesia to export rice to Malaysia Antara News 30th Mar 2017
Indonesia will export 15 to 50 thousand tons of rice to Malaysia in an effort to meet the neighboring countrys demand and requirement for the commodity. "Some time ago, the agriculture minister of Malaysia had met me and expressed interest to import rice from Indonesia," Agriculture Minister Andi Amran Sulaiman noted here on Thursday.

President asks KPPU to watch competition in food business Antara News 30th Mar 2017
President Joko Widodo (Jokowi) has ordered the Business Competition Supervisory Commission (KPPU) to keep an eye on the competition in the food commodity business in order to promote commodity price stability.

Indonesia potential to become world`s largest gastronomy country Antara News 29th Mar 2017
Indonesia is potential to break into the ranks of worlds largest gastronomy countries with a number of supporting factors it has, an expert has said. "Very likely with its varieties of fauna and flora in addition to its cultures and culinary," Chairman of the Indonesian Gastronomy Academy (AGI) Vita Datau Mesakh said here on Wednesday.

Palm oil producers revise up palm oil production, stock data The Jakarta Post 28th Mar 2017
The Indonesian Palm Oil Producers Association (GAPKI) has revised the 2016 palm oil production and stock figures. According to the revised figures, production stood at 35.57 million tons and stock at 3.57 million tons, from 34.5 million tons and 1.07 million tons, respectively, as reported previously. The 35.57 million tons of production consists of 32.52 million tons of crude palm oil (CPO) and 3.05 million crude palm kernel oil (CPKO). “The revision is based on data collection and field surveys with various related associations,” said GAPKI executive director Fadhil Hasan in a recent press statement.

Contributions from Agriculture Sector Remain Low Tempo 27th Mar 2017
 Finance Deputy Minister Mardiasmo said that Indonesia's economic growth and those of other countries today are far worse than those in the 90s. Mardiasmo explained that Indonesia's economic growth in the 90s was mainly supported by the agriculture sector that made up 50 percent of the total GDP. However, over the years, the sector's contribution started to decrease during the global crisis in 1998.

Indonesia's rice self-sufficiency to be achieved by 2020 The Jakarta Post 31st Mar 2017
Bank Indonesia (BI) projects the country will achieve rice self-sufficiency by 2020 if paddy conversion stops and the government is consistent in its efforts to increase the size of paddy and develop irrigation infrastructure. “Agriculture infrastructure projects are ongoing. It will take three to five years for us to reap the results. Indonesia can be a rice self-sufficient country by 2020,” Dody Budi Waluyo, assistant to the BI governor for monetary and economic policy, told a media briefing on Thursday. The central bank predicts rice production will reach more than 50 million tons in 2020, while consumption will reach fewer than 43 million tons.

Environmental damage, social conflicts overshadow Indonesia’s palm oil future | Asia Pacific Report Asia Pacific Report 27th Mar 2017
By Ratri M. Siniwi and Muham in Jakarta Palm oil is an important commodity for Indonesia’s economy, contributing US$17.8 billion, or about 12 percent, to its export revenue. While this year the production of crude palm oil is likely toincrease 16 percent, to up to 33 million tons, with expected conducive weather conditions, environmental issues and social conflicts continue to overshadow the sector’s future in the world’s biggest palm-oil producing country. Palm oil industry has been accused of causing deforestation, environmental degradation, and human rights violations ranging from land disputes to child labor.

Health & Life Sciences

Indonesia Integrates Human Rights in HRD of Health Sector   Tempo 30th Mar 2017
Indonesia has integrated the perspective of human rights in human resources development (HRD) to improve health services, Dainius Puras, UN special rapporteur for rights to health, said. "The application of human rights perspective, which emphasizes the fulfillment of the patients rights, contributes to improving the quality of health services," Dainius said, as quoted in a press statement of the Directorate of Human Rights and Humanity of the Indonesian Foreign Ministry, on Wednesday. The UN special rapporteur made the remarks while visiting the West Sumatra provincial capital of Padang on March 27. He positively welcomed the integration of human rights perspective in educating medical workers at the Padang Health Polytechnic (Poltekkes).

Indonesia seeks to ease import of raw materials for pharmaceutical industry - Global Times Global Times 28th Mar 2017
Indonesian health ministry has taken measures to find the source of raw material for pharmaceutical industry in domestic that will reduce the country's high importation of the unprocessed materials, a senior official of the ministry disclosed here on Monday. Investment in research and development had been increased to find the substitute for the imported drug materials and boost the quality of products, said Maura Linda Sitanggang, director general for pharmaceuticals and medical equipment of the ministry. "...Indonesia's pharmaceutical industry is expected to manufacture raw materials in domestic, so that in 2025 Indonesia will be able to reduce reliance on imported raw materials," Lind said.

ICT

RI to push for G20 working committee on digital economy The Jakarta Post 3rd Apr 2017
Indonesia is pushing for the establishment of a global working committee to facilitate discussions on digital economy concepts and technical solutions at the G20 Digital Ministers Meeting in Düsseldorf, Germany, this week.

Indonesia's Anti-Monopoly Body Slams Gov't's New Online Transport Rule Jakarta Globe 30th Mar 2017
The Business Competition Supervisory Commission or KPPU, Indonesia's anti-monopoly body, has aired its concern that the government's revisions on its ride-sharing services regulation could undermine fair business competition in the country's transportation market.

ICT Ministry to Block Online Access to Rogue Ride-Hailing Apps Jakarta Globe 27th Mar 2017
The Ministry of Communication and Information Technology will block consumer access to app-based ride-hailing services if those companies are found to violate stipulations outlined in the controversial revision to a 2016 ministerial regulation, set to come into effect on Saturday (01/04).

Infrastructure

Government launches scheme to fund land acquisition for infrastructure projects The Jakarta Post 4th Apr 2017
The Finance Ministry through its State Asset Management Agency (LMAN), a public agency responsible for state asset management, launched on Tuesday a new scheme to fund land acquisition for the country’s national strategic projects (PSN). As part of the new scheme, two public bodies, the Toll Road Regulatory Agency (BPJT) and the Public Works and Public Housing Ministry, signed a memorandum of understanding (MoU) with 23 toll road companies (BUJTs). Among the 23 companies are state-owned construction firm PT Hutama Karya and PT Jasamarga Manado Bitung, a subsidiary of state-owned toll road operator Jasa Marga that is responsible for the Manado-Bitung toll road development project in North Sulawesi.

Government Provides Capital Injection for Infrastructure Projects Tempo 4th Apr 2017
Coordinating Economic Minister Darmin Nasution hoped that an allocation of a state capital injection (PMN) worth Rp 20 trillion (USD 1.5 billion) for a public service agency (BLU) that deals with national asset management (LMAN) will help with national strategic project developments. Capital injections have been parts of the 2017 State Budget focused land procurements for strategic products.

World Bank approves new loan for Indonesian infrastructure Antara News 28th Mar 2017
The World Bank has approved a new loan of US$200 million for Indonesia to help finance the countrys infrastructure projects. The loan fund would be used to support PT Indonesia Infrastructure Finance (IIF), a non bank private institution," chief representative of the World Bank in Indonesia Rodrigo Chaves said here on Saturday. "There is a big need for investment in Indonesian infrastructure and population on its way to become a high income country," Chaves said. Earlier, the World Bank and the International Finance Corporation (IFC) already provided fund for PT IIF to finance commercial infrastructure projects in the country.

Japan selected as partner for Jakarta-Surabaya railway project The Jakarta Post 27th Mar 2017
The government has finally decided to select Japan as its partner in the revitalization of the railway connecting Jakarta and Surabaya, East Java. "We have decided that we will use [the scheme] with Japan," Coordinating Maritime Affairs Minister Luhut Binsar Pandjaitan said as quoted by kontan.co.id on Sunday, adding that the preliminary feasibility study for the project was slated to start in May. "There will be joint study with Japan and we hope that [the construction] will finish in the fourth quarter of 2019," Luhut said.

Manufacturing

Manufacturing Industry Produces More in March, Optimistic About Year Ahead Jakarta Globe 4th Apr 2017
Indonesia's manufacturing industry showed a marked improvement in March from a month earlier as companies scaled up production to meet new orders, the Nikkei Indonesia Manufacturing purchasing managers' index survey revealed.

Indonesia car sales rise 7.5 pct y/y in February Reuters 28th Mar 2017
Car sales in Indonesia rose 7.5 percent in February from a year earlier, data released by the automotive industry association showed on Tuesday. Automakers sold 94,791 vehicles in February, the data showed. On a monthly basis, car sales up 9.9 percent from January.

Garment exports projected to stagnate this year The Jakarta Post 28th Mar 2017
The Indonesia Textile Association (API) projects that garment exports will stagnate this year after declining by 3.2 percent to US$11.9 billion last year. “It’s good if it’s stagnant. Last year it declined because there are several problems that still persist in the country, though there have been some improvements in facilities from the government to boost the sector,” API chairman Ade Sudrajat told The Jakarta Post recently. Problems include contradictory policies between central and local administrations, complicated tax procedures, inadequate infrastructure that leads to high logistics costs and electricity and gas prices that are higher than neighboring countries.