| Multilateral Trade Agreements
Indonesia to challenge 'discriminative' EU directive on palm oil euronews 31st Jan 2019
Indonesia intends to challenge an EU directive on renewable energy at the World Trade Organization, arguing the plan to curb the use of crops that cause deforestation will unfairly target palm oil, a senior Indonesian official told Reuters.
Indonesia turns to Global Fund to ensure ARV stock The Jakarta Post 23rd Jan 2019
Amid rising concerns about the availability of antiretroviral (ARV) therapy drugs following a failed drug tender, the government has given assurances that stocks are enough until the end of this year. The Health Ministry’s pharmaceutical and medical devices director general, Engko Sosialine Magdalene, said that although the government had failed to procure the drug, people should not worry because there was enough stock of fixed-dose combination ARV medication that contained tenofovir, lamivudine and efavirenz (FDC TLE) in one tablet.
National Affairs
Indonesia president renews pledge to cut corporate taxes if re-elected U.S. 31st Jan 2019
Indonesia’s President Joko Widodo has renewed a pledge to cut corporate tax rates in Southeast Asia’s biggest economy if he is re-elected in April, an economic adviser said on Thursday, following a similar promise by his election opponent. Widodo’s opponent in the April election, ex-general Prabowo Subianto, plans to cut corporate tax rates by up to 8 percentage points to boost economic growth if he wins, Harryadin Mahardika, an economist in his campaign team has said.
Jokowinomics and the Future Path for Indonesia’s Economy The Diplomat 24th Jan 2019
Indonesia’s economic performance under President Joko “Jokowi” Widodo will come under increasingly heavy scrutiny as campaigning for the 2019 presidential election progresses. Unlike recent political debates, themes surrounding identity politics and religion appear to have subsided, thanks to the last-minute pick of conservative Muslim cleric Ma’ruf Amin as Jokowi’s running mate.
Indonesia refugee policy is on right track The Jakarta Post 24th Jan 2019
January 2019 marks two years of President Joko “Jokowi” Widodo’s 2016 presidential decree on handling foreign refugees. The Presidential Decree no. 125/2016 on the Treatment of Refugees from Overseas, signed on Dec. 31, 2016, provides legal certainty and standard procedures on coordination and effective collaboration among the mandated government agencies.On the right to housing, article 26 of the decree instructs that facilitation of refugee shelters support can be sought from international organizations regarding basic necessities such as clean water, food, clothing, healthcare and hygiene, and religious facilities. The decree does not specify any international organization.The children cannot get certificates of graduation as they are not registered in residential family cards. However the UNHCR noted that around 320 child refugees are now enrolled in accredited national schools, from which 2,835 children are in school age.
Certainty, not promises, businesses tell presidential candidates The Jakarta Post 17th Jan 2019
Indonesian businessman are calling on presidential candidates Jokowi and Prabowo for clear guidelines in the upcoming April elections to ensure domestic competitiveness. They expressed that setting their priorities straight to strengthen the domestic economy were more important amid ongoing disruptions from the United States-China trade war and monetary normalization in developed markets.The food and beverage industry had been Indonesia’s highest growing manufacturing sector over the past few years, with growth estimated to reach its peak at 8.71 percent this year, according to the Industry Ministry. Businessman wants both candidates to be able to manage the risks associated.
Market Development
Indonesia to further relax export procedures The Jakarta Post 25th Jan 2019
The government said it would ease procedures to boost exports, with the aim of bolstering the country’s current account, as the trade deficit was recorded at US$ 8.57 billion in 2018, the largest deficit since 1975. Coordinating Economic Minister Darmin Nasution said in Jakarta on Thursday that the government would look to ease survey requirements for exports, depending on the requirements of the destination country.
The global economic slowdown is 'strongly welcome,' Indonesia investment chief says CNBC 23rd Jan 2019
The recent softening of global economic growth is "strongly welcome," Indonesia's investment chief told CNBC Wednesday, warning of financial risks that had been building up in China and beyond. Indonesia have seen a change in attitude from dominant economic powerhouse China. Foreign direct investment into Indonesia from emerging markets like China slowed last year, Bank Indonesia data from the second quarter of 2018 showed.
Food, beverage holding company first to go public this year The Jakarta Post 17th Jan 2019
Food and beverage holding company PT Sentra Food Indonesia has become the first company to be publicly listed on the Indonesia Stock Exchange (IDX) this year. It raised Rp 20.3 billion (US$1.42 million) from the sale of 150 billion shares, amounting to 23.7 percent of the company’s shares.PT Super Capital Indonesia also owns gas company PT Super Energy.
Customs
The urgency to boost exports The Jakarta Post 31st Jan 2019
SHARES The US$8.60 billion trade deficit last year, the largest in the past 44 years, seemed to have rudely jolted the government into realizing that there is an urgency to make a more concerted effort to boost exports. Coordinating Economic Minister Darmin Nasution promised to go all out in reducing bureaucratic barriers to exports. The Trade Ministry’s international trade director general, Oke Nurwan, promised to remove regulatory barriers. However, Shinta Kamdani, a senior executive of the Indonesian Chamber of Commerce and Industry, called for meaningful dialogue between the government and the business community. We assume that when the government said it would ease the requirements for exports that it was referring to the export of industrial products — not mineral ores that are subject to domestic refining. Promoting more exports in manufacturing, in addition to increasing oil production and wooing more foreign tourists, is one of the most effective ways of restoring a trade surplus, thereby reducing the big current account deficit, which has been causing downward pressures on the rupiah. A steep depreciation of the rupiah could fuel up a vicious cycle within the economy as a whole. But we do not yet see any sense of urgency among various government institutions to resolve the export problems. In 2003, then-president Megawati Soekarnoputri set up a special export development task force. However, our exports have continued to depend largely on mining and agriculture-based commodities, the prices of which are highly volatile, according to the international market. The government has never been truly serious about removing the biggest hurdle to exports: the acute lack of interministerial coordination in managing regulations and bureaucracy. Exports are part of intersectoral activities. In fact, for exports in manufacturing, the export process itself is actually the end of a long chain of operations that starts with the import of basic materials and components before moving to port handling, transportation, processing and shipping. A handicap in one stage of the chain could adversely affect the competitiveness of exports, either because of delayed delivery or higher prices. Hence, what is urgently needed is an interministerial team led directly by the President that meets monthly with the leaders of various business and industrial associations to discuss any problems faced in all stages of the export industry.
Indonesia seeks duty-free imports of fish products into Japan The Jakarta Post 30th Jan 2019
Maritime Affairs and Fisheries Minister Susi Pudjiastuti is calling on the Japanese government to remove import tariffs from Indonesian fishery products. Susi made the request when meeting with Japanese businesspeople at the ministry in Jakarta on Tuesday. She said Indonesian fishery products faced 7 percent import tariffs to enter the Japanese market, even though Japan was not levying any tariffs on Vietnamese or Thai fishery products. “It is not only for Indonesian business players, but it is also for Japanese companies,” Susi said as quoted by kompas.com, adding that the quality of Indonesia’s fishery products were much better than those of the two countries she mentioned. She added that the quality of Indonesia’s tuna was much better because Indonesia has a larger maritime territory than either Thailand or Vietnam. Susi believed the removal of tariffs from Indonesian fish products would help improve the business climate in the fishery sector both in Japan and Indonesia and also open more investment opportunities for Japanese companies in Indonesia.
Indonesia, Turkey conclude third round of CEPA talks The Jakarta Post 28th Jan 2019
Indonesia and Turkey have held a third round of talks on the Comprehensive Economic Partnership Agreement (IT-CEPA) in Jakarta. During the meeting held from Thursday to Friday last week, the Trade Ministry’s bilateral negotiations director, Ni Made Ayu Marthini, said delegates of the two countries had started to discuss crucial issues to boost bilateral trade. "Indonesia stressed the importance of constructive negotiations to discuss crucial issues in six working groups," Made said in press statement released over the weekend. She said the two sides had completed terms of reference at the meeting, which would serve as a guide for the next round of negotiations.
Govt expects lower exports to China, US this year The Jakarta Post 23rd Jan 2019
Coordinating Economic Minister Darmin Nasution said Indonesian exports to China were likely to drop this year, because China’s economic growth projection for this year was only 6.2 percent, compared to growth of 6.6 percent in 2018. He said the economic slowdown in China would affect the global economy, including Indonesia, because the Chinese market accounted for 15 to 20 percent of Indonesia’s total exports. The minister also expects lower exports to the United States. “Our export to China will decline, and those to the US will also decline. That is why we have to find new markets,” Darmin said in Jakarta on Tuesday as quoted by kompas.com, adding that, however, finding new markets would take time. Darmin also pointed to an expected global economic slowdown this year, as indicated by the IMF’s growth projection of 3.5 percent, which was brought down from the earlier expectation of 3.7 percent. However, the IMF has not revised its projection for US economic growth for this year, which remains at 2.5 percent. The minister stressed that the trade war between China and the US as well as the government shutdown in the US would affect the global economy this year. “The trade war could stop suddenly, but as long as it lasts, it has an impact on the whole world, because the countries [involved in the spat] are the two largest economies,” he added.
Indonesia's services sector has great potential, Trade Ministry says The Jakarta Post 20th Jan 2019
Stakeholders are seeking to amplify the role of Indonesia’s services sector to manage the country’s current account and balance of payment in the face of dwindling commodity prices and a stagnant manufacturing industry. Between 2010 and 2017, Indonesia’s services sector grew at an average of 7.1 percent per year, much higher than the manufacturing and agricultural sectors at 4.4 percent and 3.7 percent, respectively, according to Statistics Indonesia (BPS). “The more advanced a country becomes, the larger a role its services sector plays, especially as Indonesia is keen to implement the fourth industrial revolution, or Industry 4.0,” the Trade Ministry’s director general for international trade negotiations, Iman Pambagyo, said at a recent seminar in Jakarta held by the Centre for Strategic and International Studies (CSIS). “Among ASEAN countries alone, Indonesian [services] have entered sectors like engineering in Myanmar, business services in Singapore and construction in Vietnam [...] not to mention the development of [mobile] apps and animation works Indonesians sell to foreign companies that must certainly be valuable.” Unfortunately, Iman said, the data available on Indonesia’s services sector is scarce, and Bank Indonesia (BI) and the BPS — who are in charge of collecting them — do not offer a comparable database to the international standards used in trade negotiations. This has limited the sector’s potentials, which according to the BPS, had contributed a whopping 43.6 percent to the national GDP in 2017.
Economics
Indonesia to deliver 250 train cars to Bangladesh in 2019 The Jakarta Post 21st Jan 2019
State-owned train maker PT Industri Kereta Api (Inka) sent on Sunday 15 train cars to Bangladesh, a portion of 250 train cars to be exported to the country this year after the company exported 200 train cars to the country in 2006 and 2016. Inka president director Budi Noviantoro explained that the company had exported 150 train cars worth $79.39 million in 2016 and 50 train cars worth $13.8 million in 2006.
Energy
Power infrastructure to drive Indonesia's energy sector growth: Fitch Solutions The Business Times 24th Jan 2019
Construction of power infrastructure -- chiefly coal-fired power plants -- will remain the primary driver of growth in Indonesia's energy and utilities sector for the near future, said Fitch Solutions Macro Research in a Jan 16 report. However, there are risks that power projects may be postponed due to the country's widening current account deficit and a weakening rupiah, which would then cause a drag on growth. The power sector accounts for over 85 per cent of the total value of all energy and utilities projects, with a total project value of US$64.1 billion, according to Fitch Solutions' key projects database. State-owned Perusahaan Listrik Negara is involved in the majority of projects that are in the pre-construction and construction phases, and Fitch Solutions expects the government's investment in energy projects to grow, expanding electricity capacity to keep pace with rapid economic growth. Fitch Solutions forecasts real growth of 4.6 per cent for the power infrastructure sector in 2019, to average 5 per cent annually between 2019 and 2027. The sector is expected to be the main pillar supporting growth of the overall energy and utilities sector, ahead of the water and pipeline infrastructure sub-sectors.
Indonesia resumes discussion to overhaul oil and gas law Rambu Energy 24th Jan 2019
The Indonesian government has resumed discussion to amend the Oil and Gas Law issued in 2001, with an aim to improve business and investment climate of the sector and ultimately boost the country’s oil and gas production. On Wednesday (Jan. 23), President Joko Widodo conducted a limited cabinet meeting to discuss the draft amendment of the Oil and Gas Law, which was initiated by the People’s Representative Council (DPR). The draft law has been presented to the government to respond to the draft law. ‘ In response, the government has proposed its own ideas, in particular on some controversial issues. Among issues of the draft law is the proposed establishment of Special Business Entity (Badan Usaha Khusus) in Oil and Gas Sector. However, the government appears to disagree about the proposed plan.
Govt says 98.05 percent of households have electricity. What does it mean? The Jakarta Post 23rd Jan 2019
President Joko “Jokowi” Widodo's administration has boasted that nearly all households in Indonesia have electricity, saying that the country had reached an electrification ratio of 98.05 percent as of September. However, does this mean that 98.05 percent of the nation’s households enjoy 24-hour electricity for all their electronics like residents in Java’s big cities enjoy? In the last eight years, the government’s data show that the electrification ratio jumped by 30.85 percentage points from only 67.2 percent in 2010 to 98.05 percent as of September 2018. The ratio progress follows the escalation of power plant capacity from between just 25 and 30 megawatts (MW) in 2010 to 62.4 MW as of September 2018. The government calculates the electrification ratio from the total number of households that have access to electricity compared to the total number of households in the country, which is estimated to be more than 60 million households. In March, Energy and Mineral Resources Minister Ignasius Jonan said the government also included the electricity provided by the private power utility in the calculation of the national electrification ratio. Out of the 98.05 percent, 95 percent comes from PLN, 2.5 percent from non-state electricity firms and 0.12 percent from the government’s solar-powered energy saving lamps (LTSHE) program. Based on those figures, the government came up with the result in September that 33 out of 34 provinces had reached more than 80 percent electrification except for East Nusa Tenggara with only 61.01 percent.
Indonesian Pertamina's Feb planned imports at 9-10 mil barrels; lower from Jan: sources Hellenic Shipping News Worldwide 22nd Jan 2019
Indonesia’s state-owned Pertamina is expected to import around 9 million-10 million barrels of gasoline in February 2019, down from the estimated 10 million-11 million barrels in January, market sources said. Although higher from February 2018, Pertamina’s lower import volumes in February, compared with January, will likely exert downward pressure on the Asian gasoline market. Despite a slight rebound at the start of the year, the market has remained weak due to high inventories in Singapore and Fujairah in January. Indonesia imported 6.8 million barrels of gasoline in February 2018, around one-third lower than the 10.5 million barrels the company had imported in January 2018, according to data from Statistics Indonesia.
Binary pilot geothermal plant in Lahendong, Indonesia officially handed over Think GeoEnergy - Geothermal Energy News 21st Jan 2019
In October 2017, the first low-temperature geothermal demonstration power plant was successfully commissioned in Lahendong/ Tomohon, North Sulawesi. The construction and operation of the geothermal power plant is a joint study carried out between the Agency for the Assessment and Application of Technology (BPPT), the Ministry of Research, Technology and Higher Education with the German Federal Government through the GeoForschungsZentrum (GFZ) German Research Center for Geosciences supported by PGE. “We hope that this plant can operate properly, reliably, and continue to provide benefits for operations in the Lahendong Field. In addition, it is hoped that this plant can increase the knowledge, experience and capabilities of Indonesia’s human resources,” said PGE President Director Ali Mundakir in a statement. In a ceremony today, the 500 kW plant was officially handed over to the Indonesian partners. “I am proud to hand over Lahendong Binary Geothermal Power Plant to the Ministry of Research, Technology and Higher Education (RISTEKDIKTI). German-Indonesian Research Cooperation at its best. Binary geothermal technology can be replicated in many parts of Indonesia, so Dr. Peter Schoof, German Ambassador to Indonesia.
Pertamina Oil, Gas Production Jump 42 Percent in 2018 Tempo 18th Jan 2019
State-owned oil and gas company Pertaminarecorded the country’s production of oil and gas throughout 2018 increased to 768,000 barrels of oil equivalent per day (MBOEPD). The figure jumped 42 percent when compared to that of last year at 542,000 barrels. Pertamina Upstream Director Dharmawan H Samsu said that the figure saw a positive trend of Pertamina. “[We] will continue to maintain this [performance] to prove that Pertamina as the national company carries out a mandate to fulfill needs of national energy,” said Samsu in a written statement, Jakarta, Thursday, January 17. Additionally, the gas production in 2018 reached 2,763 million standard cubic feet per day (MMSCFD). The volume rose by 57 percent than that in 2017 at 1,760 MMSCFD. Pertamina also recorded that several oil and gas blocks had entered its production system, namely Mahakam Block, Sanga-Sanga Block, East Kalimantan Block, and OSES (Offshore South East Sumatera) Block. “As SOE and administrator of state assets, we will continuously strengthen baseline production to ensure that we optimize recovery factor in all Pertamina oil and gas fields by using economic and effective approaches,” Samsu noted.
PLN coal consumption in 2019 seen 5% higher than last year Rambu Energy 17th Jan 2019
The coal needs of the state-owned electricity company PT Perusahaan Listrik Negara (PLN) is projected to reach 96 million tons (Mt) this year, which is 5% higher than realized coal consumption last year at 91.1 million. The realized coal consumption last year was slightly lower than the target of 92 Mt. The projected increase was due to additional demand from the new coal-fired power plants, which are scheduled to begin commercial operation this year. The Head for Coal Division of PLN Harlen was quoted by Kontan as saying that this year, PLN’s power plants consumed around 7.5-8 Mt of coal per month. Based on the prevailing domestic market obligation requirement, coal producers are required to allocate 25% of their coal production to the domestic market. Those failed to meet the requirement will be given disincentive by approving lower production quota.
Indonesia eyes LNG export to Cambodia Antara News 17th Jan 2019
Indonesia has eyed export of liquefied natural gas (LNG) to Cambodia to meet the demand for power plants in the country, Vice President Jusuf Kalla said here on Wednesday. "I have talked about our economy. The Minister of Energy and Mineral Resources (Ignasius Jonan) and a team of PGN (the state gas firm PT Perusahaan Gas Negara) will continue the discussion in Phnom Penh and on how we can sell gas (to Cambodia)," Kalla stated. According to Kalla, the high electricity tariff in Cambodia should be seen as an opportunity for Indonesia to offer natural gas as an alternative to diesel oil for power generator. "Electricity here is very expensive, US$17 cent (per KwH), while our price is $7 cent. I have explained (to Premier Hun Sen) that our minister has already talked about it and it would be continued today," he added. Meanwhile, Jonan remarked that private electricity company has controlled 90 percent of production in Cambodia and the remaining was managed by the government. Power plants in Cambodia have used diesel oil, coal, and water for the generator, while the country has yet to have the infrastructure for gas-generated power plant. "We offer to replace diesel oil with gas. PGN has made the offer. If they agree, PGN will invest here (in Cambodia)," Jonan noted. A gas-generated power plant would need a facility of regasification to convert LNG into electricity. Therefore, Indonesia has also offered development of the regasification facility.
Financial Services
Indonesia's E-commerce Market Larger Than Estimated; Consumer Habits Changing: Study Jakarta Globe 5th Feb 2019
A recent survey by Morgan Stanly showed that 93 percent of respondents have purchased clothing and footwear online within the past 12 months. (Reuters Photo/Robert Galbraith) Jakarta. E-commerce accounted for 8 percent of total retail sales in Indonesia last year, on course to reach 18 percent by 2023, fueled by changing behavior among tech-savvy customers who are willing to spend more for convenience, according to a recent study by American multinational investment bank Morgan Stanley. The study estimates the size of Indonesia's e-commerce market at $13 billion in 2018, having grown by 50 percent annually over the past two years. It suggests that the e-commerce market in Southeast Asia's biggest economy may follow a similar growth trajectory to that of China and expand by at least 32 percent annually over the next five years to $52 billion in 2023. "This is notably above our previous estimate of $7.3 billion, or 4.4 percent of sales, partially due to better data availability but also due to the rapid growth in the user base... Indonesia is now only five years behind China in terms of penetration," Morgan Stanley wrote.
Poor logistics hold back Indonesian e-commerce from 'quantum' leap The Jakarta Post 4th Feb 2019
Accenture, a Fortune 500 business consultancy, has estimated that Indonesia’s e-commerce market may grow from US$27 billion last year to $300 billion by 2025, if the country’s digital ecosystem can leapfrog into a fully integrated “quantum commerce” environment. “This means integrating everything from your phone, entertainment, transport, health and food,” said Accenture managing director Mohammed Sirajuddeen in his keynote presentation recently during the two-day Future Commerce Indonesia 2019. Accenture’s prediction is bold and three times higher than the widely accepted Google-Temasek growth projection of $100 billion by 2025, based on a business-as-usual growth rate. While "quantum commerce" sounds like an idealistic marketing term, Sirajuddeendid pointed to China as a more concrete example of the well-integrated digital ecosystem that Indonesia needed to work toward to achieve "fantastic" e-commerce growth.
Health & Life Sciences
Jakarta launches health-related digital services The Jakarta Post 31st Jan 2019
The city administration launched Wednesday two websites and an app that aim to help improve health services for residents. The three services are Jak-Track, DBDKlim and E-jiwa. Jak-Track is a website that tracks data and reports on the progress of an HIV/AIDS prevention program in the capital. DBDKlim is a website that provides estimates for the number of dengue fever cases in each municipality across Jakarta, with rainfall and humidity used as the main predictors. E-jiwa is an app that focuses on the early detection of mental health issues. The app was invented by a community health center (Puskesmas) in Cilandak, South Jakarta, last year.
Dengue kills more than 100 people in Indonesia | The Jakarta Post 27th Jan 2019
More than 100 people have died of dengue fever this month, with the largest number of fatalities, 41, recorded in East Java, 13 in North Sulawesi and 12 in East Nusa Tenggara (NTT), the Health Ministry has said. Dengue had also killed people in 16 other provinces by Saturday, Central Java recorded nine fatalities, one in West Java and seven in South Sulawesi, the ministry’s director for vector-borne and zoonotic diseases Siti Nadia Tarmizi said. The ministry has recorded at least 9,634 dengue cases in 372 cities and regencies across the archipelago during this year's rainy season when dengue-bearing mosquitoes are most active. By Saturday, four regions, Kupang city and West Manggarai regency in NTT, Kapuas regency in Central Kalimantan and North Sulawesi province had declared a dengue emergency according to Siti.
City braces for dengue alert period in February, March The Jakarta Post 22nd Jan 2019
Jakarta has entered a dengue fever extraordinary situation (KLB) alert period that will last until March. “We predict that the risk of dengue fever will increase in the coming days and weeks during the rainy season in early 2019,” Jakarta Health Agency head Widyastuti said in a press statement on Sunday. Widyastuti said that the areas categorized as having the highest probability of dengue fever incidents during the alert period in January were West Jakarta, South Jakarta and East Jakarta. “In February and March, all areas throughout the city will be categorized as under alert," she said, as quoted by kompas.com. She explained that the amount of rainfall and climate change had immensely influenced the growth of Aedes aegypti, the type of mosquito that transmits the dengue fever virus.
Health Ministry warns of dengue fever during rainy season The Jakarta Post 21st Jan 2019
People should be extra mindful of the spread of dengue fever amid the rainy season, when dengue-bearing mosquitos are most active, the Health Ministry said on Monday. According to Health Ministry records, three provinces have declared a dengue fever emergency as of Monday: North Sulawesi, East Nusa Tenggara (NTT) and Central Kalimantan. The ministry’s director for vector-borne and zoonotic diseases, Siti Nadia Tarmizi, said the number of reported dengue fever cases was indeed rising, but every case had to be confirmed to determine whether it was indeed dengue fever. Citing data compiled by the ministry, she said 10 provinces had shown an uptrend in dengue fever cases between Jan. 1 and 17. They were East Java with 1,081 cases, Central Java ( 650 ), West Java ( 541 ), East Kalimantan ( 236 ), South Kalimantan ( 241 ), NTT ( 208 ), Lampung ( 204 ), North Sumatra ( 177 ), South Sulawesi ( 172 ) and Banten ( 120 ).
SETARA brings reproductive health to classrooms The Jakarta Post 17th Jan 2019
When it comes to education on sexual reproductive health (SRH), misunderstanding and suspicion persist.Sexual reproductive health education has always been a critical issue confronting young people, educators, parents and society at large.Robert Blum, a professor at the department of Population and Reproductive Health at Johns Hopkins Bloomberg School of Public Health, said that in Indonesia and many neighboring countries, SRH remained a taboo topic never discussed at home or taught in schools.“These youth are often missing out in important information that, in many cases, can save their lives,” said Blum, who conducts research and studies on youths around the world and is now involved in a four-year Explore4Action project together with the Gadjah Mada University and Rutgers WPF Indonesia.
ICT
Regulation on ride-hailing 'ojek' to be issued this week The Jakarta Post 28th Jan 2019
The Transportation Ministry will issue a regulation this week to protect users of ride-hailing applications that use ojek (motorcycle taxi) services, the ministry’s land transportation director general, Budi Setiadi, said on Sunday. He said the ministry would hold a meeting this week that would be attended by representatives of all stakeholders to discuss the final draft of a new transportation ministerial regulation. “We will complete the regulation this week and it will begin to be enforced in March 2019,” Budi said as quoted by kompas.com. He explained that there were three main points in the regulation, namely suspensions for drivers, floor and ceiling rates and safety. Similar to how ride-hailing vehicles are regulated with a price floor of Rp 3,000 (21 US cents) per kilometer and price ceiling of Rp 6,000 per km, motorcycles will also be given set rates.
Technology policy likely to stay its course in Indonesia: Fitch Solutions The Business Times 24th Jan 2019
The president has been receptive to the idea of leveraging technology to boost the economy and has introduced stimulus packages and funding for tech projects and network infrastructure. That being said, macroeconomic headwinds, namely volatile currency and uncertain global growth, remain and could weigh on government spending around these IT initiatives.
If at First You Don’t Succeed... Indonesia Makes Another Attempt to Regulate App-based Ride-Hailing Services Lexology 23rd Jan 2019
As is the case in practically all jurisdictions around the world, Indonesia’s regulators have struggled to come to grips with the disruption caused to conventional public transportation models by the emergence and phenomenal growth of app-based ride-hailing services. To date, the Minister of Transportation (the “Minister”) has made a total of four attempts to regulate the sector, with the latest being Reg. No. 118 of 2018 on the Provision of Special For-Hire Transportation Services (“Reg. 118”),[1] which entered into effect on 19 December 2018. The Minister’s first attempt, back in 2016, proved short lived after an outcry from conventional taxi companies and drivers. The next attempt was Regulation No. 26 of 2017. However, the specific provisions of this regulation that related to ride-hailing services were struck down by the Supreme Court, which found that they contravened Law No. 20 of 2008 on Micro, Small and Medium Enterprises and Law No. 22 of 2009 on Road Traffic and Transportation.
Indonesia poised to become the most dynamic market in SE Asia Disruptive.Asia 31st Jan 2019
South East Asian markets acquired a large number of e-commerce platforms such as Lazada and Alibaba. Subsequently, mobile apps such as e-wallets and electricity tracking tools faced significant growth amongst consumers. Indonesia possesses a unique mobile-first ecosystem and demographic that allows it to stand out to investors among other emerging markets in Southeast Asia. As the fourth most populous country in the world, and growing further still, Indonesia presents significant potential in terms of mobile penetration rates. The country is projected to be a huge contributor to the Next Billion Users of the Internet, the latest generation of internet users to come online on smartphones.
Indonesia Plans Electric Vehicle Incentives for Foreign Car Makers US News 29th Jan 2019
Indonesia is finalizing a new electric vehicle (EV) policy that will offer fiscal incentives to foreign car makers, as it ramps up efforts to become a lithium battery hub, its deputy industry minister said on Tuesday. The minister stated that Indonesia's target is for 20% of all cars produced to be electric vehicles by 2025. Indonesia, second largest car production hub in Southeast Asia after Thailand, plans to introduce a fiscal scheme that will offer tax cuts to EV battery producers and automakers, as well as preferential tariff agreements with other countries that have a high EV demand.
Tech-infused cooperatives rising to compete in digital era The Jakarta Post 17th Jan 2019
Saving and lending cooperatives, locally known as simpan-pinjam, have dominated grassroot-level financing for decades in Indonesia, but they are now tussling with technology as they compete with internet-based lenders. Some of the cooperatives are opening up to new technology by partnering with fintech lenders. For example, Koperasi Syariah Benteng Mikro Indonesia (Kopsyah BMI) in Tangerang, Banten, collaborates with nonprofit crowdfunding platform Kiva since 2014 to increase its capital and thereby issue more loans. The partnership helped more than double the cooperative’s cash account from Rp 17.6 billion (US$1.23 million) in 2014 to Rp 42 billion the following year.
Tax office to issue e-commerce taxation guideline The Jakarta Post 17th Jan 2019
Responding to recent confusion over a finance ministerial regulation on taxation for online transactions, the Director General of Taxation will issue a regulation as a guideline for traders who conduct business using e-commerce platforms. Finance Minister Sri Mulyani Indrawati said on Wednesday that the director general would ensure that online merchants would not have to provide their tax numbers (NPWPs) or citizenship identity numbers (NIKs). “We would like to convey [to the public] that there is no requirement [for merchants] to submit their NPWP or NIK [on e-commerce platforms]. Further details will be outlined in a regulation,” Sri Mulyani said in Jakarta on Wednesday.
Infrastructure
Indonesia Signs Transportation Agreement with East Timor Tempo 22nd Jan 2019
Transportation Minister Budi Karya Sumadi signed a Memorandum of Understanding (MoU) with Timor Leste's Minister of Transportation and Communication Jose Agustinho Da Silva. The deal aims at improving Indonesian and Timor Leste airlines. Budi Karya believes the cooperation can encourage economic, trade and tourism growth between the two countries. "This meeting is expected to further encourage economic growth and the quality of human resources both in Indonesia and Timor Leste," Budi said in a written statement Monday, January 21. Budi said that if there is a future growth in the market demand, the transportation capacity of the two countries, the governments will consider further improvement efforts.
Two Train Routes will Connect Kertajati Airport Tempo 19th Jan 2019
Minister of Transportation, Budi Karya Sumadi, said train routes of Bandung-Garut and Cianjur-Bandung will be forwarded to Kertajati Airportfor accessibility support. He targets the two train routes will be reactivated this year. “These routes will be forwarded to Kertajati Airport. As we know, train is one of the favored transportations chosen by the people; [since it is] cheap, no pollution and on time,” said budi as quoted from the written statement received by Tempo, on Friday January 18. State railway company KAI will fund the Bandung-Garut route, while the Cianjur-Bandung route will be funded by the Ministry of Transportation.
Legislation
Indonesia to announce new EV policy, plans tax incentives to lure automakers and battery producers Paul Tan's Automotive News 4th Feb 2019
In a bid to become the region’s focal point for electric vehicle (EV) production, Indonesia is reportedly set to announce a broad-ranging EV policy that will offer tax cuts to EV battery producers and foreign automakers, Reuters reports. Last week, deputy minister for industry Harjanto said that Indonesia is encouraging companies and investors in Japan and Korea to get into the electric vehicle business in Indonesia at all levels.
Minister Sri Mulyani woos investors to bring in FDI to Indonesia The Jakarta Post 1st Feb 2019
Speaking to investors at a seminar in Jakarta recently, Finance Minister Sri Mulyani Indrawati felt compelled to mention each of the business sectors eligible to apply for a tax holiday. Investors could also expect a speedier application process as they could apply for the incentive through the online single submission (OSS) system, a web-based licensing system operated by the Coordinating Investment Board (BKPM).The government had pinned its hopes on fiscal incentives, such as a tax holiday and tax allowances, as well as other structural reforms like streamlining licensing through the OSS, to attract foreign direct investment (FDI) so as to bolster the balance of payments.
|
