Indonesia Update: May 17, 2018

Indonesia Update | May 17, 2018
Authors: Kim Yaeger, Artha Sirait, Ian Saccomanno, and Jade Hoang
 
LOOKING AHEAD
 
 

May 22 - Debrief with USTR on the US-Indonesia Trade and Investment Framework Agreement (TIFA) in Washington, DC: The U.S. Government and Government of Indonesia held annual Trade and Investment Framework Agreement (TIFA) discussions on May 14 in Jakarta, Indonesia. The discussion covered a range of issues of interest to the U.S. business community, including data flows, e-commerce, agricultural trade, and intellectual property. Please join us for a debrief following the discussions with Bartholomew Thanhauser, Director for Southeast Asia and the Pacific at USTR.  Click here to register.

May 14-23 - Global Coal-Fired Power Emissions Control Technologies Reverse Trade Mission: The U.S. Trade and Development Agency is hosting the Global Coal-Fired Power Emissions Control Technologies Reverse Trade Mission to introduce energy regulators and coal plant operators to innovative U.S. technologies, equipment, and best practices for observing and controlling emissions from coal-fired power plants. As part of the visit, USTDA will host a Business Briefing for U.S. companies on Thursday, May 17, 2018 at the Embassy Suites, 535 Smithfield Street, Pittsburgh, PA from 10:00 a.m. to 4:00 p.m. with a networking reception to immediately follow at the Embassy Suites. The delegation from Indonesia include Ridwan Tamin, Erlangga Hassan and Anton Poernomo from the Ministry of Environment and Forestry. The registration fee for this Business Briefing is $50 and includes lunch and admission to the networking reception. Please click here for more information.

 
THE COUNCIL'S TAKE
 
 

Update on Indonesia’s Latest Draft Law on Personal Data Protection

In April 2018, the Government of Indonesia issued a new draft personal data protection law. Indonesia previously published an initial draft law in 2015 which has since stalled with no progress. There is a strong push for the law on data protection due to the recent investigation launched by the Indonesian government on the use of Indonesian users’ data by a social media company.

The draft law defines personal data as any data that can identify a particular person or any data about a particular person which when combined with other information, can identify a person. Further, the draft law categorizes personal data into two groups: 1) general data, which includes data that is available in the public domain or has previously been disclosed, and 2) specific data, which includes personal data that requires protection containing sensitive information such as health, biometrics, criminal records, etc. or as particularly identified by applicable laws and regulations.

In addition, the draft law also distinguishes personal data controllers and personal data processors. Personal data controllers are parties that collect and manage the data processing, while personal data processors are parties acting on behalf of the controllers to process personal data. The draft law particularly defines “processing” to include acquiring and collecting of data; processing and analyzing of data; storing and displaying of data; fixing and renewing of data; announcing and delivering data; distributing, disclosing and deleting data.

According to the draft, personal data controllers must obtain consent from data owners prior to processing or transferring such data domestically. Cross-border data transfer is not allowed under the draft law unless:

  • Such jurisdiction has the same level of protection as provided under the draft law;
  • There is a contract between the data controllers with the relevant international party; or
  • There is an international agreement between such jurisdiction and Indonesia.

Indonesia currently does not have a consolidated data protection law. However, there are a number of laws and regulations that address data protection issues such as Law No. 11 of 2008 on Electronic Information and Transaction (as amended by Law No. 19 of 2016); Government Regulation No. 82 of 2012 and Minister Regulation No. 20 of 2016 on Personal Data Protection in Electronic Systems. If passed, this draft law could supersede Government or Ministerial Regulations but it is not clear if that is what the Government plans to do or to complement all the existing regulations on the subject matter.

The draft personal data protection law has not been included in the 2018 National Legislation Program (Prolegnas), the list of prioritized laws for Parliament’s deliberation. The timeline for when it will be discussed by the House of Representatives (DPR) is therefore unclear and there is little information as to whether there will be a public comment period. That being said, both the DPR and the Ministry of Communication and Information Technology (Kominfo) have expressed strong desire to take firm actions on data privacy by establishing a comprehensive regulatory framework that can protect their citizens’ data. Initiatives to enhance Indonesia’s digital capacity and literacy are also being developed to help the country adequately respond to various transformations in the digital space. It will is also one of several critical elements in sustaining the rapid growth of eCommerce in Indonesia which analysts estimates to reach over $8 billion in 2018 and with an annual growth rate (CAGR 2018-2022) of 17.7%.

Bank Indonesia Sets New Limits for the Provision of E-Money

On May 4, Bank Indonesia (BI) issued Regulation No. 20/6/PBI/2018 on Electronic Money, which replaces previous regulations dealing with the same matter including Regulation No. 11/12/PBI/2009 and Regulation No. 18/17/PBI/2016. In addition to merging the regulations and updating certain licensing processes, Regulation No. 20 adds several new provisions including:

  • Closed-loop payment services to the sector regulated, with closed-loop being defined as an arrangement where the party receiving payment is the same party that issued the e-money;
  • Paid-up capital threshold of Rp3 billion (US$213,525) for non-bank issuers, which must be increased in proportion to the floating fund held by the issuer;
  • Limitation of 49% foreign ownership for new non-bank e-money issuers, both directly and indirectly; and
  • Requirement for the majority of the Board of Directors of non-bank e-money issuers to be based in Indonesia.
Regulation No. 20 is expected to pose restrictive barriers to foreign players in Indonesia’s financial industry, in addition to BI’s existing Regulation No. 19/8/PBI/2017 on National Payment Gateway which came into force last December. While e-money licenses issued before the enactment of the regulation remain valid for five years after the effective date, existing and prospective non-bank e-money license holders will have six months to comply with other requirements detailed in the regulation. Relevant businesses are therefore advised to make necessary adjustments to avoid foreseeable disruption in their operations.
 
ADVOCACY UPDATE
 
 

Call for Input: U.S. Reviewing Trade Preferences for Indonesia

The Office of the United States Trade Representative (USTR) announced that it is reviewing the eligibility of Indonesia, along with India and Kazakhstan, in the Generalized System of Preferences (GSP) based on non-compliance concerns. These reviews are the result of country eligibility petitions submitted by interested stakeholders and an assessment of the 25 Asian and Pacific Island GSP beneficiary countries conducted by the GSP Subcommittee. The review on Indonesia will focus on whether it meets the following two GSP criteria:

(1) The GSP criterion that requires a GSP beneficiary country to assure the United States that it will provide equitable and reasonable access to its market, and

(2) the GSP criterion that requires a GSP beneficiary country to reduce trade-distorting investment practices and reduce or eliminate barriers to trade in services. As described in the Indonesia Chapter of the 2018 National Trade Estimate Report on Foreign Trade Barriers, Indonesia has implemented a wide array of trade policies which created negative effects on U.S. commerce.

The existing review of Indonesia's compliance with the GSP criterion related to intellectual property rights is separate, and will continue.

The Council is seeking your input as to how your business is specifically affected, and how we can support the continuation of Indonesia’s compliance with the GSP, as part of our robust economic relationship. Please contact Artha Sirait at asirait@usasean.org with your specific input by May 25. Public hearing at USTR will take place on June 19.

 
IN THIS UPDATE
 
 
Regional Affairs
Indonesia hopes travel advisories will not affect Asian Games
12 countries issue travel advisories following terrorist attacks
Indonesia's Widodo congratulates Mahathir on winning Malaysia`s election
Preparations for IMF-World Bank meeting continue despite bombings: Minister

National Affairs
House Speaker urges ministries to monitor mass organizations
Transportation Ministry official gets 5 years' imprisonment over graft
Police involve army`s special elite force to combat terrorism
Ulema From Three Countries Meet in West Java, Denounce Terrorism, Suicide Attacks
Jokowi praises PPP party leader as fit for being vice president
Indonesia to propose three national parks as new biosphere reserves
Multiple bomb attacks kill eight in Indonesia`s second largest city
Mako Brimob standoff ends, all inmates surrender
Indonesia not afraid of terrorism, Jokowi says

Economics
Companies reschedule IPO plans over volatile market
Indonesia books double digit tax growth in first four months
Indonesia raises interest rate for 1st time since 2014
Indonesia finalizes fiscal incentives for investments below Rp 500b
Surging April Imports Produce Indonesia's Biggest Trade Deficit in 4 Years
Indonesia still has many poor people: Jokowi

Energy
After coal, government pushes DMO on gas for electricity
Pertamina ensures fuel availability for Ramadhan
Five oil contractors seek contract extension: Ministry official
Indonesia reaches 1,925 MW installed geothermal power generation capacity

Financial Services
Bank Indonesia raises policy rate to 4.50 percent
Bank Indonesia Says Intervening to Support Rupiah, Preparing to Adjust Rates
Bank Indonesia Sets New Limits for the Provision of E-Money
Indonesia affirms cap on foreign ownership in insurers at 80%

Food & Agriculture
Indonesia to import 500,000 tons of more rice
Govt. Revokes Regulation on Trading of Refined Crystal Sugar through the Commodity Auction Market
No need for rice market operations, logistics agency chief claims

Health & Life Sciences
Jakarta rules out compulsory vaccination for school admission

ICT
Former Intelligence Deputy Urge Public to Fight Hoax, Terrorism
Four Social Media Platforms Take Down Radical Accounts
 
ARTICLE CLIPS
 
 
Regional Affairs

Indonesia hopes travel advisories will not affect Asian Games Antara News 17th May 2018
Indonesia hopes travel advisories produced by a number of countries, following recent terror attacks in the country, will not affect the 18th Asian Games to be held in Jakarta and Palembang from August 18 to September 2. "We hope with the support from all the people of Indonesia and anticipatory and mitigation measures that are taken by the army (TNI) and the police, as well as ministries and state institutions, the travel advisories will not be extended," Coordinating Minister for Human Development and Culture, Puan Maharani, stated after a coordination meeting on Asian Games security with a number of ministers and representatives from ministries and state institutions here, on Thursday. She noted that travel advisories were produced as an implementation of responsibility of countries that produced them for their citizens in Indonesia or who are going to go to the country. "We have asked the fourth deputy for security of the Indonesia Asian Games Organizing Committee (Inasgoc) to coordinate with TNI and police as well as ministries and state institutions," she remarked.

12 countries issue travel advisories following terrorist attacks The Jakarta Post 16th May 2018
Twelve countries, including the United States, United Kingdom, Australia, Singapore and Malaysia, have reportedly issued travel advisories for their citizens in Indonesia following recent terrorist attacks in Surabaya and Sidoarjo in East Java. Tourism Minister Arief Yahya said on Wednesday as quoted by kontan.co.id, that issuing travel advisories was a country’s responsibility to alert its citizens. Read also: Tourism Ministry to provide regular updates following terror attacks Arief said travel advisories meant a country was still safe to visit, explaining that there were three levels of alerts, namely travel advisory, travel warning and travel ban.  

Indonesia's Widodo congratulates Mahathir on winning Malaysia`s election Antara News 15th May 2018
President Joko Widodo congratulated Mahathir Mohamad on being elected as the Malaysian prime minister through a smooth general election. "I congratulate Pakatan Harapan on winning the 14th Malaysian general election held yesterday," President Widodo stated here on Friday. According to a press statement of the Presidential Secretariat in Jakarta, Widodo had contacted Mohamad on Thursday evening. Widodo lauded the smooth implementation of Malaysia`s general election. "I praise the democratic process in Malaysia that was held in a smooth and peaceful manner," President Widodo added. While communicating with Mohamad, Widodo remarked that the relationship between Indonesia and Malaysia will be further intensified.

Preparations for IMF-World Bank meeting continue despite bombings: Minister The Jakarta Post 15th May 2018
The Finance Ministry is confident that the recent suicide bombings in Surabaya, East Java, will not affect the government’s preparations for the 2018 IMF-World Bank meeting, which is scheduled to be held in Bali in October. “We are going ahead with our preparations,” Finance Minister Sri Mulyani said in Jakarta on Monday as reported by Antara. The government, Indonesian Military (TNI) and the National Police are closely working together to ensure the resort island’s security, she added. The former is also coordinating with the meeting’s organizing committee in Washington to assure its members that the event – which is expected to welcome 15,000 participants – will run smoothly.

National Affairs

House Speaker urges ministries to monitor mass organizations Antara News 17th May 2018
House Speaker Bambang Soesatyo has urged House Commissions to push ministries and institutions concerned to monitor mass organizations to assure that they do not operate against principles put in the constitution. He made the request here on Thursday in response to the huge number of mass organizations registered with three ministries and because of the absence of clear mechanism for monitoring their activities. Based on the government`s data, a total of 375 mass organizations are registered with the ministry of home affairs, while 83 foreign mass organizations are registered with the ministry of foreign affairs and 324,482 with the ministry of justice and human rights.

Transportation Ministry official gets 5 years' imprisonment over graft The Jakarta Post 17th May 2018
A panel of judges at the Jakarta Corruption Court has sentenced former Transportation Ministry sea transportation director general Antonius Tonny Budiono to five years in prison for accepting bribes related to the issuance of harbor dredging permits. "[The judges hereby] order the defendant to pay Rp 300 million [US$21,339] in fines or face an additional three months in prison,” said presiding judge Saifuddin Zuhri as quoted by Antara when he read out the verdict in a hearing on Thursday. Corruption Eradication Commission prosecutors had sought seven years in prison for Tonny, but the judges gave him a lesser sentence following the prosecutors' decision to grant the defendant justice collaborator status.

Police involve army`s special elite force to combat terrorism Antara News 16th May 2018
The Indonesian Police Headquarters has involved the Army`s Special Elite Force (Kopassus) in combating terrorism in the country. "Kopassus has been involved in it (counter-terrorism)," Chief of the Public Relations Division at the National Police Headquarters Inspector General Setyo Wasisto stated here on Wednesday. Wasisto noted that the Chief of the National Police, General Tito Karnavian, has revealed the involvement of Kopassus in counter-terrorism efforts. The National Police`s Mobile Brigade (Brimob) has been cooperating with Kopassus in maintaining security when an anti-terror squad raided a terrorist cell.

Ulema From Three Countries Meet in West Java, Denounce Terrorism, Suicide Attacks Jakarta Globe 16th May 2018
Islamic scholars from Indonesia, Afghanistan and Pakistan denounced violent extremism, terrorism and suicide attacks as against Islamic principles, in a declaration issued during a conference in Bogor, West Java, on Friday (11/05). The Trilateral Ulema Conference was hosted at Bogor Palace by the Indonesian Ulema Council (MUI), in an effort to promote an inclusive peace process in Afghanistan. "As one family of ummah [the Muslim community], we support an inclusive peace process and stand ready to contribute constructively to the process, while recognizing various efforts and peace offers to find viable solutions for peace in Afghanistan," the participating ulema said in the declaration. The conference was opened by President Joko "Jokowi" Widodo. "The meeting is part of Indonesia's commitment to promote the role of ulema in realizing inclusive peace in Afghanistan. ... We know the road to peace is never easy, but as people of faith we must believe in God's help and never lose hope or give up," the president said.

Jokowi praises PPP party leader as fit for being vice president Antara News 15th May 2018
President Joko Widodo (Jokowi) has praised the United Development Party (PPP) chief Romahurmuzy as being fit for a vice president. At a national meeting for legislative assembly members from the party here on Tuesday, he stated that Romahurmuzy was fit to be a vice presidential candidate. Jokowi has decided to run again in the presidential election next year, but he has not yet decided who would be his running mate. At the PPP function at Hotel Mercure in Ancol, a video footage of the president`s interview with anchor Najwa Shihab was reviewed. During the occasion, Shihab asked about the vice presidential issue while showing the picture of Romahurmuzy, or Romi as he is popularly called.

Indonesia to propose three national parks as new biosphere reserves The Jakarta Post 15th May 2018
Indonesia will propose to have three national parks declared as new biosphere reserves at the 30th Man and the Biosphere Program International Coordinating Council (MAB-ICC), scheduled to be held on July 23-28 in Palembang, South Sumatra. “We will nominate Berbak Sembilang in South Sumatra and Jambi, Betung Kerihun Danau Sentarum in West Kalimantan and Rinjani in West Nusa Tenggara," Enny Sudarmonowati, head of the MAB-UNESCO’s national committee, said in Jakarta on Monday as quoted by tempo.co.  MAB-ICC is UNESCO’s annual agenda to discuss the development of biosphere reserves to restore ecosystems. According to UNESCO’s official website, “biosphere reserves are said to be areas comprising terrestrial, marine and coastal ecosystems. Each reserve promotes solutions reconciling the conservation of biodiversity with its sustainable use.”

Multiple bomb attacks kill eight in Indonesia`s second largest city Antara News 13th May 2018
At least eight people were killed in multiple bomb attacks in Surabaya, Indonesia`s second largest city, on Sunday morning, police said. The eight were victims of bomb attacks at three different churches in the city on Sunday morning, spokesperson for the East Java Provincial Police Senior Commissioner Frans Barung Mangera said. "The latest update shows that eight people have died and 38 others are injured," Mangera said. Four of the eight people were killed at the Santa Marta Tak Bercela Catholic Church, two at GKI (Indonesian Christian Church) on Diponegoro Street, and the other two at GPPS (Central Pantekosta Church of Surabaya) on Arjuna Street.

Mako Brimob standoff ends, all inmates surrender The Jakarta Post 10th May 2018
Coordinating Political, Legal and Security Affairs Minister Wiranto has announced that the standoff between the security forces and terrorist inmates at a detention center located at the National Police’s Mobile Brigade headquarters (Mako Brimob) in Depok, West Java, is over. The minister said that on Thursday morning the authorities stormed the prison and the inmates, who had seized 30 weapons from the police and killed five officers, had surrendered. “Some 145 inmates gave up without resistance. Another 10 resisted but surrendered in the face of overwhelming force by the authorities.” Previously, the police said that five members of the Police's Densus 88 counterterrorism squad had been killed while another officer was being held hostage following a riot at the detention center that broke out on Tuesday night. 

Indonesia not afraid of terrorism, Jokowi says The Jakarta Post 10th May 2018
President Joko “Jokowi” Widodo has underlined that the state and the people of Indonesia will not tolerate terrorism. “The state and all of the people will never be afraid and will never give space to terrorism or any other effort to undermine the country’s security,” he told journalists during a press conference at the Bogor Palace on Thursday. In the brief press conference called after the 40-hour standoff ended, the president expressed appreciation for the work of the police in the prison riot. “All of the terrorist convicts have surrendered to the security officers, and at this opportunity I want to say the biggest thank you on behalf of the people and the state to all of the officers involved in handling this case,” he said.

Economics

Companies reschedule IPO plans over volatile market The Jakarta Post 17th May 2018
Several companies have announced their intention to reschedule plans for an initial public offering (IPO) due to ongoing volatility in the domestic stock market. Pipe manufacturer PT Wahana Duta Jaya Rucika is among the companies to postpone its IPO, Indonesia Stock Exchange (IDX) director Samsul Hidayat said on Wednesday However, he declined to provide the reasons behind Rucika’s decision. Meanwhile, securities firm Mandiri Sekuritas director Laksono Widodo said several of the firm’s clients had expressed a similar desire. “Two companies want to postpone their IPO plans; they have rescheduled their IPO to the second half of 2018,” Laksono said as reported by kontan.co.id, though declined to provide names.

Indonesia books double digit tax growth in first four months The Jakarta Post 17th May 2018
Indonesia booked double-digit tax revenue growth in April boosted by growth in import taxes as well as corporation tax. Tax revenue, which includes income tax from oil and gas, value added tax (PPn), property tax (PBB) and luxury goods tax (PPnBM), was Rp 383.3 trillion (US$ 27.23 billion) from January to April. The tax revenue grew by 14.08 percent year-on-year (yoy) compared to the same period last year if the revenue from the tax amnesty is excluded. The government collected Rp 12 trillion in penalties as part of the tax amnesty, which ended in March 2017. “We monitor the tax revenue on a monthly basis and this still shows robust growth,” said Finance Minister Sri Mulyani Indrawati in Jakarta on Thursday.

Indonesia raises interest rate for 1st time since 2014 Nikkei Asian Review 17th May 2018
Indonesia's central bank has raised its benchmark interest rate for the first time in almost four years as it battles to stop the slide of the rupiah against rising U.S. interest rates. Bank Indonesia on Thursday decided to hike its benchmark seven-day repo rate by 25 basis points to 4.50%, marking the first rate increase since November 2014, when the central bank operated under a different benchmark rate.

Indonesia finalizes fiscal incentives for investments below Rp 500b The Jakarta Post 16th May 2018
The government is finalizing a regulation on fiscal incentives for new investments below Rp 500 billion (US$35.49 million), which are not covered in the latest tax-holiday scheme. Under the regulation being prepared, fresh investments worth between Rp 100 billion and Rp 500 billion will be eligible for a 50 percent cut in corporation tax for five years, said Investment Coordinating Board (BKPM) deputy director Azhar Lubis. “The new incentives will be applied for pioneering industries that do not meet the Rp 500 billion requirement [for obtaining a tax holiday],” he said in Jakarta on Wednesday The industries eligible for the incentives will be the same industries stipulated in Finance Ministry Regulation (PMK) No. 35/2018 on tax holidays, which include pharmaceutical raw materials, petrochemicals and semiconductors, as well as electrical parts and manufacturing.

Surging April Imports Produce Indonesia's Biggest Trade Deficit in 4 Years Jakarta Globe 15th May 2018
Indonesia posted its biggest trade deficit in four years in April as imports surged, wrong-footing analysts who expected a surplus for the month. The statistics bureau said the April deficit reflected "seasonal factors" including this week's start of Ramadan, the Muslim fasting month. Southeast Asia's largest economy had a deficit of $1.62 billion, the biggest since April 2014 while the Reuters poll forecast was for a $700 million surplus.

Indonesia still has many poor people: Jokowi Antara News 10th May 2018
President Joko Widodo (Jokowi) acknowledged that Indonesia still has many poor people who still have to be lifted up from poverty. "The government continues to make efforts to improve the welfare of poor citizens. There are still a lot of people who are poor," the president stated, during the commemoration of the 92nd anniversary of Nahdlatul Ulama (NU) Islamic organization here, on Wednesday. Jokowi noted that the government will continue to develop the people`s economy to improve their welfare. The president, on the occasion, was accompanied by the chief of the Presidential Staff Office, Moeldoko, and the head of the Presidential Secretariat, Heru Budi Hartono.

Energy

After coal, government pushes DMO on gas for electricity The Jakarta Post 17th May 2018
After introducing its domestic market obligation (DMO) policy for coal on March 12, the government is going forward with its plan to introduce a DMO for gas in an effort to reduce electricity prices. Energy and Mineral Resources Ministry Electricity Director General Andy N. Sommeng said in Jakarta on Thursday that the DMO was expected to take effect by the end of this year. He said that gas was the most efficient option for electricity production in outermost, frontline and disadvantaged regions, most of which are not connected to the main networks of state-owned electricity company PLN. Andy said the government had considered the impact of the policy on the upstream gas sector.

Pertamina ensures fuel availability for Ramadhan The Jakarta Post 16th May 2018
The government is anticipating a jump in fuel consumption during the month of Ramadhan, which will start on Thursday, according to state-owned energy firm Pertamina. The company estimates gasoline demand to rise by 15 percent to 90,000 kiloliters (kl) per day. Consumption of the subsidized Solar diesel fuel, however, is estimated to decrease by 12 percent to 32,300 kl per day during the fasting month, due to a restriction placed on trucks mandating that they are not allowed to operate in the week leading up to Idul Fitri. Pertamina has prepared an additional stock of subsidized Premium-branded gasoline, whose consumption was estimated to surge by 7 percent to around 27,000 kl per day, Pertamina logistics, supply chain and infrastructure director Gandhi Sriwododo said in a press briefing on Wednesday. “I believed that our fuel stock is more than enough, so no need to worry,” he said.

Five oil contractors seek contract extension: Ministry official The Jakarta Post 15th May 2018
Five out of six existing oil contractors have submitted their proposals to extend their contracts to operate various oil blocks, according to an Energy and Mineral Resources Ministry official. “All existing contractors have submitted their proposals, except Conocophillips. The company will submit its proposal with a gross-split scheme,” the ministry’s oil and gas director general, Djoko Siswanto, said in Jakarta on Monday as reported by kontan.co.id. He added that Conocophillips currently operated South Jambi Block. Under new government regulations, oil and gas contractors are required to change their contracts from cost recovery to a gross-split scheme.

Indonesia reaches 1,925 MW installed geothermal power generation capacity Think GeoEnergy - Geothermal Energy News 14th May 2018
The installed power generation capacity in Indonesia has reached 1,924.5 MW  in the first quarter of 2018. It is expected that the capacity will reach 2,058.5 MW at the end of the year. With an achievement of 1,924.5 MW it put Indonesia in second place in the world after the United States in utilizing geothermal power, shifting second position previously occupied by the Philippines.

Financial Services

Bank Indonesia raises policy rate to 4.50 percent The Jakarta Post 17th May 2018
Bank Indonesia (BI) has raised its policy rate as it seeks stability amid lingering external pressures, while hinting at further increases down the line. The central bank's seven-day reverse repo rate was increased by 25 basis points to 4.50 percent, while lending facility and deposit facility rates were also raised by 25 bps, to 5.25 and 3.75 percent, respectively. “Bank Indonesia will continue to monitor the development of the economy and is ready to undertake stronger measures to ensure macroeconomic stability is maintained,” said Bank Indonesia Governor Agus Martowardojo in Jakarta on Thursday. As part of its policy mix, the central bank also decided to keep its countercyclical capital buffer at 0 percent in a bid to maintain stability of the financial system and encourage banking intermediation.

Bank Indonesia Says Intervening to Support Rupiah, Preparing to Adjust Rates Jakarta Globe 10th May 2018
Indonesia's central bank said on Wednesday (09/05) it was intervening in the markets to support the rupiah and was preparing to adjust its benchmark interest rate, suggesting it may hike rates to shore up the currency, now at its weakest in two and a half years. In a statement, Bank Indonesia (BI) said it was "in the middle of preparing firm and consistent monetary policy steps including by adjusting the seven-day reverse repo rate," its key rate. BI said it was also "optimizing other monetary operation instruments" to ensure enough rupiah and dollar onshore liquidity.

Bank Indonesia Sets New Limits for the Provision of E-Money Lexology 10th May 2018
Bank Indonesia (“BI”) has issued a long-anticipated regulation on e-money that stipulates a number of requirements and prohibitions that were previously unregulated. The new regulation, BI Regulation No. 20/6/PBI/2018 regarding Electronic Money (“BI Reg 20”), revokes all existing BI e-money regulations.

Indonesia affirms cap on foreign ownership in insurers at 80% Allen & Overy 10th May 2018
ndonesia has enacted Regulation no.14/2018 on Foreign Ownership of Insurance Companies, which came into force on 18 April 2018 and confirms a maximum threshold for foreign ownership of an Indonesian insurance company of 80%. The new regulation provides welcome clarification of the law relating to ownership and foreign participation in the Indonesian Insurance Industry. However, as the OJK has already been applying many of the features of the new regulation in practice in recent years, no material impact is anticipated as it amounts to an affirmation of existing policy.

Food & Agriculture

Indonesia to import 500,000 tons of more rice The Jakarta Post 17th May 2018
The Trade Ministry has issued a permit for State Logistics Agency (Bulog) to import an additional 500,000 tons of rice this year after it previously issued a permit to import the same amount  earlier this year. “We have issued an import agreement of 500,000 tons of rice. It is the second [rice import],” said the ministry’s international trade director general, Oke Nurwan, in Jakarta on Tuesday as reported by tempo.co. He said the import permit was issued during the recent meeting of ministers under the Office of the Coordinating Economic Minister. The rice, which will be imported from several countries such as Vietnam, Thailand, Myanmar, Cambodia, India and Pakistan, is expected to curb the price of rice, which is still above the price ceiling decided by the government, the official said.

Govt. Revokes Regulation on Trading of Refined Crystal Sugar through the Commodity Auction Market Hukum Online 17th May 2018
The Minister of Trade (“Minister”) has now revoked the regulation which addressed the trading of refined crystal sugar through the commodity auction market through the issuance of Regulation of the Minister No. 54 of 2018 (“Regulation 54/2018”) on the Revocation of Regulation of the Minister No. 16 M-DAG/PER/3/2017 on the Trading of Refined Crystal Sugar through the Commodity Auction Market, as amended several times

No need for rice market operations, logistics agency chief claims The Jakarta Post 15th May 2018
State Logistics Agency (Bulog) president director Budi Waseso says he can guarantee the availability of rice in the market because under his leadership, the agency will no longer hold market operations, a mechanism used to push rice prices down due to rice scarcity. “[Under my leadership], there will be no market operations, which Bulog had only used like a fire  extinguisher. I want that [rice] to always be available [in the market],” said Budi as reported by kompas.com on Tuesday. Soon after his inauguration as Bulog chief, Budi introduced the use of a barcode system to monitor an online database of commodities.

Health & Life Sciences

Jakarta rules out compulsory vaccination for school admission The Jakarta Post 16th May 2018
The Jakarta administration has ruled out compulsory vaccination for kindergarten and elementary school admission, according to a circular letter issued by the Jakarta Education Agency. Jakarta Education Agency deputy head Bowo Irianto said the decision was taken to make it easy for parents who wanted to enroll their children in kindergartens or elementary schools. “Jakarta has a very varied population, so access to schools must be open wide and in a nondiscriminatory way,” Bowo told The Jakarta Post on Wednesday. “Besides, immunizations can be done after the children are enrolled in school, which the city’s health facilities will provide,” Bowo said. The circular letter came to attention when a citizen, Widhi Maulana, 32, posted a WhatsApp comment criticizing the decision.

ICT

Former Intelligence Deputy Urge Public to Fight Hoax, Terrorism Tempo 17th May 2018
Former Deputy Chief of the State Intelligence Agency (BIN) As`ad Said Ali urged everyone to research or study the news sources people read during the Ramadan month to fight the spread of hoax, hate speech, radicalization, and terrorism. As’ad further explained that people must refrain from any activities that can potentially break people’s fast such as hoaxes and slanders. “And one more, refrain from conducting terrorist attacks in the name of religion,” said As’ad Ali on Wednesday, May 16. He admits that a large portion of society must understand the culture of confirmation and information research, considering that conventional and social media are often used by radical groups to spread hoaxes. “It must be confirmed first and thought about whether the contents [of an information] corroborate with the religious teaching or would it in fact ruin the religion,” he said.

Four Social Media Platforms Take Down Radical Accounts Tempo 15th May 2018
Communications and Informatics Minister Rudiantara said that four social media platforms, namely Facebook, Instagram, Youtube, and Telegram, have taken down numerous provocative accounts related to radicalism and terrorism. “Thousands of accounts have been confirmed to be either taken down or removed, some have yet to do that,” said Rudiantara at his office in Central Jakarta. The mass takedown is related to the multiple church bombings in Surabaya and other terrorist bombings that happened two days in a row that was conducted by a Jamaah Anshorut Daulah (JAD) terrorist cell. According to the minister, thousands of accounts and contents were taken down from Facebook, Instagram, Youtube, and Telegram.