Indonesia Update: September 11th, 2019

Indonesia Update: September 11th, 2019
Authors: Angga Antagia, Kim Yaeger, Michaela Wong, Ayu Nadia
 
 
THE COUNCIL'S TAKE
 
 

Indonesia Plans to Raise State Health Insurer’s Premiums

BPJS Kesehatan, manager of Indonesia’s national health insurance, plans to raise premiums by at least 65% beginning in September 2019 to fill a 32 trillion rupiah ($2.25 billion) gap in the finances for the universal healthcare plan. The health agency has experienced deficits in five out of the six years since its widely-supported introduction in 2014, largely stemming from claims amounts that exceed the premiums it collects. BPJS will raise the cheapest premium by 65% to 42,000 rupiah ($2.97) per month and has already removed 5.2 million people from the beneficiaries list. The government has also shifted revenue collected from the tobacco tax to the national insurance program. The number of Indonesians with health insurance has roughly doubled since the program’s launch in 2014 and now includes 80% of the national population.

The planned increase faces criticism from the Indonesian public, who demand improved services with the price hike. BPJS introduced the program to target millions of Indonesians who could not afford private coverage, but had too high an income to receive government benefits. Despite widespread support for the program, many Indonesians have paid a lesser amount than required, while others skip payments entirely until they become sick.

Finance Minister Sri Mulyani responded to the 28 trillion rupiah ($2 billion) deficit with a large budget increase to 48.8 trillion rupiah ($3.41 billion) for 2020 to account for the higher subsidies now needed for the poor. In exchange for the larger 2020 state budget allocation, Sri Mulyani has urged BPJS to improve management and enhance contribution from regional governments. BPJS President Director Fachmi Idris stated he is committed to addressing the Finance Ministry’s concerns.

Government of Indonesia Prepares Bill on Taxation to Keep Up with the Rapid Change of Economic Needs

In response to dynamic and rapidly changing economic needs, the Government of Indonesia has proposed a new Bill on taxation that will accommodate and amend parts of the existing laws on tax. Among these laws are the Income Tax Law (PPh), Value-Added Tax (VAT), and General Taxation Law (KUP), which were established to make Indonesia’s taxation regime more competitive for investors. The Bill also serves as a response to President Jokowi Widodo’s request for policies on investment and trade focusing on the ease of doing business and increasing investment in Indonesia, both of which emphasize the pro-investment stance of President Jokowi’s administration. Several items being added to the Bill include the elimination of income tax on dividends for domestic or foreign firms investing in Indonesia, lowering the enterprise income tax rate, and tax procedures for digital-based companies that lack physical presence in Indonesia but have domestic consumers.

Moreover, President Jokowi requested that tax incentives be made available to enterprises. He pointed to examples such as the expansion of tax holidays, changes in tax allowance, investment allowance incentives, and super deduction incentives for the development of vocational and R&D activities, as well as in labor-intensive industries. Minister of Finance Sri Mulyani expressed hope that the Bill will be proposed to the Parliament (DPR) immediately for review and approval. However, before submission to the DPR, the results will be finalized and a public consultation is expected to be carried out to compile input to formulate the Bill. The Bill will then be proposed to the DPR by the President.

Nickel Prices Surge as Indonesia Instates Ban on Ore Exports

Global nickel prices surged this week after Indonesia’s Ministry of Energy and Mineral Resources announced on August 30 it would ban exports of nickel ore beginning January 1, 2020. The ban follows the national plan to expedite the establishment of smelters, which will allow Indonesia to export value-added nickel products, including stainless steel slabs. The ministry announcement comes two years earlier than expected and will apply to all grades of nickel ore regardless of standing contracts past the January 1 deadline. Immediately following the announcement, nickel prices have risen to the highest amount in almost 5 years to $18,850 per ton.

Indonesia is the world’s largest nickel ore producer and made up 26% of the 2018 global supply, with China being the world’s biggest nickel consumer. The ban is the latest move by the Indonesian government to gain more control over its supply of nickel ore and move up the value chain by demanding more in-country processing, rather than simply encouraging it. The suspension is also an attempt to preserve low-grade nickel ore containing cobalt and lithium for use in electric batteries. Despite the acceleration of the nickel exports ban, exports of bauxite and copper concentrates will roll out in 2022 as planned. 

Indonesia has already imposed a ban on ore exports in 2014, though the government eased it in 2017 by allowing surplus, lower-grade nickel ore below 1.7% to finance smelter construction. The 2014 ban did spur investment in nickel smelting, with most of the seven smelters added in 2017 belonging to the nickel industry. Investment in nickel smelting is attractive because nickel mining costs only 2-3% of total market value. Recently re-elected President Jokowi has endorsed the country’s continued shift toward resource nationalism, including announcing to parliament in August that he will push for adding value to natural resources exports across the board.

 
ADVOCACY UPDATE
 
 

Ministry of Manpower Decree on Job Position Available for Foreign Worker

Ministry of Manpower issued new Ministerial Decree (Kepmen) No. 228/2019 on Job Positions Available for Foreign Workers issued on August 27 and went into effect the day it was issued. Kepmen 228/2019 aims to simplify the work permit process for foreign workers by creating one list of job positions (Closed Positive List) in several industries that are available to foreigners. Previous sector specific regulations on foreign worker job positions were officially revoked on the issuance date of the Kepmen, with the exception of the financial sector, which remains under the Financial Services Authority (OJK). The new Positive List contains 18 main industries, taken from the Indonesian Standard Industrial Classification (KBLUI) system issued by the Statistics Center Body of Indonesia (BPS). From those 18 industries, there are about 2200 job positions, based on the 4-digit International Standard Classification of Occupations (ISCO) code.

Key important points are:

  • High-level positions such as commissioner or director (except HR) are automatically available for foreign workers.
  • For job positions that are not in the Positive List, companies can apply for an exception to the Ministry of Manpower.
  • The Positive List will be evaluated every two years or when needed.
  • Work permits granted before the regulation was issued will remain valid until their expiration date.

The Council has collaborated with foreign chambers and the Ministry of Manpower to formulate a more business-friendly Kepmen. The Ministry accommodated our request to expand the number of job positions in the Positive List, explain the exception mechanism for new jobs, and clarify the exemption clause for commissioners and directors. There is still some concern that a closed positive list could indicate problems in defining and accommodating new positions.

Furthermore, the new Ministerial Decree can be found here.

E-catalogue for Government Procurement

The Council submitted a joint submission (based on members’ inputs) with the European Chamber of Commerce (EuroCham) to the National Public Procurement Agency  (LKPP) on August 21, 2019 with the following key comments and recommendations:

  1. Delays and Lengthy Processes - A value-based procurement system, which can provide flexibility in the process and add criteria for reimbursement according to the value of the solutions offered and can accommodate the needs of adjustments from various rapid product innovations.
  2. Negotiation and Procurement Process – A competitive and innovative pricing structure that considers the cost of raw materials, distribution, operations, R&D investment, and maintenance service financing after purchase, and allows providers to justify competitive prices.
  3. Transparency – Throughout the process, more transparency is needed to provide risk and business certainty which would ultimately accelerate hospitals’ and patients’ access to medicine.

Full input submission letter can be found here

 
IN THIS UPDATE
 
 
Regional Affairs
Protests in West Papua Escalate With Reports of Killings
Indonesia Sends Police to Restive Region After Racial Slurs Ignite Protests

National Affairs
Nickel is surging after Indonesia said it will ban exports of the metal from January | Markets Insider
Indonesia Rolls Out $33 Billion Plan to Move Its Capital City
Habibie’s $1b superblock completes first phase of construction, eyes foreign buyers
Skills gap, inadequate regulations hamper digital economy

Market Development
Sri Mulyani pledges to create favorable policies, tax incentives to boost capital market

Economics
Private consumption most significant growth driver for Indonesia: UOB
Rupiah holds its ground despite fall in share prices
Trade war’s ‘second wave’ will be more painful, says Indonesia finance minister
Indonesia surprises with second rate cut to support growth

Financial Services
OJK launches online fintech monitoring platform amid industry’s rapid growth
Indonesia to raise state health insurer's premiums to plug cash deficit
WhatsApp in talks to launch mobile payments in Indonesia

Food & Agriculture
Products labeled "palm oil-free" are banned from Indonesian shelves
Bangka Belitung eyes farm, fishery commodity exports to East Europe
Bakmi GM set to open outlets in Sumatra
Coffee farmers yet to benefit from millennial caffeine craze
Indofood firm on palm oil expansion
Gov't Set to Redistribute 2.6mn Hectares of Forest Land

Health & Life Sciences
Aptorum Group announces the development of microbiome drug candidate targeting obesity and repurposed drug candidates targeting neuroblastoma
Bitter Pill to Swallow: Should BPJS Kesehatan Increase Premium to Cover Deficit?
Hospitals go outside Java to tap new growth potential
Local hospital chains step up expansion amid growing healthcare market
Higher healthcare premiums ‘urgent’, BPJS Kesehatan pleads as finances bleed

ICT
Kominfo to Revoke Internet Restriction in Papua on Conditions
Sri Mulyani to Call in Rudiantara to Discuss IMEI Regulation
Kominfo Spots 2 Hoaxes about Surabaya Incident Involving Papuan
Sri Mulyani Challenges Millennials to Develop Apps for Gov't
Bank Indonesia Launches QR Code Standards
Gov't Re-opens Internet Access in More Papua's Districts Tonight
More local companies migrate to cloud computing to boost business efficiency
XL to expand network to cover 95% of population in 2019
Govt, private companies push for digital transformation of MSMEs
As payments become more digitalized, cyber security is paramount: BI

Market Regulation
Global nickel supply to drop on Indonesia's ore export ban
Indonesia's Nickel Ban Shows Resource Nationalism on the March
 
ARTICLE CLIPS
 
 
Regional Affairs

Protests in West Papua Escalate With Reports of Killings The Diplomat 3rd Sep 2019
At least six protesters and one soldier have been killed during clashes in Indonesia’s Papua and West Papua province since unrest began over a two weeks ago. The Indonesian government dismissed the report of protesters being killed as “a provocation,” but said one soldier had been killed and three police officers injured.  A local news outlet, Suara Papua, first reported the protesters’ deaths last Wednesday. That same day, Al Jazeera also reported the deaths, quoting locals who say they witnessed the killings. The following morning, the Australian Broadcasting Corporation (ABC) reported on the killings, but said at least two, not six, protesters had been killed. 

Indonesia Sends Police to Restive Region After Racial Slurs Ignite Protests The New York Times 22nd Aug 2019
Protests erupted across the Indonesian provinces of Papua and West Papua this week after reports circulated that students from the region were harassed by the police and insulted with racist slurs in the East Java city of Surabaya. Thousands of people took to the streets in the two distant provinces, torching a provincial government building and clashing with police officers after a video circulated showing the students in Surabaya being called “monkey” and other names as the police surrounded their dormitory.

National Affairs

Nickel is surging after Indonesia said it will ban exports of the metal from January | Markets Insider Business Insider 3rd Sep 2019
Nickel prices surged by around 4% to a five-year high on Monday after the Indonesian government announced it would ban exports of nickel ore from January 1, 2020. The move by the Indonesian government comes two years earlier than expected, according to Al-Jazeera, as Jakarta aims to build up its local nickel industry. Nickel climbed to a five-year high of $18,785 on the London Metal Exchange after the ban was announced. The metal is commonly used to make rechargeable batteries, stainless steel, and corrosion-resistant alloys. 

Indonesia Rolls Out $33 Billion Plan to Move Its Capital City WSJ 26th Aug 2019
Indonesia will build a new capital city in eastern Borneo, the country’s president said, in the most definitive sign yet that his government is serious about moving its administrative center from congested and flood-prone Jakarta, one of Asia’s largest megacities. “The burden on Jakarta is too heavy,” Mr. Widodo said Monday. The new location in eastern Borneo, he said, would position the capital city in the geographical center of this sprawling nation and make it less vulnerable to earthquakes and other natural disasters than other parts of Indonesia.

Habibie’s $1b superblock completes first phase of construction, eyes foreign buyers The Jakarta Post 22nd Aug 2019
Publicly listed property developer PT Pollux Properti Indonesia completed on Wednesday the first phase of construction of a US$1 billion integrated mega-superblock, the Meisterstadt, in Batam, a joint venture with former president BJ Habibie’s family. Under the brand Pollux Habibie International, the developer marked completion of the first phase of construction of the Meisterstadt by topping off its fourth apartment tower, Erlesen. Erlesen is to be one of eight apartment towers, a mall, a hospital and an office tower, which are expected to be completed in 2024 or 2025. Pollux Properti sales and marketing director Maikel Tanuwidjaja said that from 10 to 15 percent of the Meisterstadt apartments’ buyers were foreigners, mostly from Singapore, Malaysia and China.

Skills gap, inadequate regulations hamper digital economy The Jakarta Post 21st Aug 2019
Indonesia’s digital economy has enormous potential not only as reflected in the high rate of its adoption in the country but also by its potential market value, which is estimated to reach more than US$100 billion in next five years. However, skills gaps, inadequate regulations and a lack of internet access out of the main cities have hindered the growth of the digital economy, researchers have said. Indef economist Berly Martawardaya said that the country needed to build its soft infrastructure including the enhancement of digital literacy and skillset of human resources to meet the expectations.A joint study conducted by Indef and nonprofit research foundation Laboratorium Data Persada projected that the market value of the country’s digital economy would almost double to Rp 1,447 trillion (US$101 billion) by 2024 from Rp 814 trillion in 2018, signifying the rapid growth of the digital industry.

Market Development

Sri Mulyani pledges to create favorable policies, tax incentives to boost capital market The Jakarta Post 26th Aug 2019
Finance Minister Sri Mulyani Indrawati has pledged to improve policies and create more tax incentives in an effort to boost the creation of new instruments in the capital market. Speaking at the Capital Market Summit and Expo in Jakarta, Sri Mulyani expressed hope about the Indonesia Stock Exchange (IDX) and the Financial Services Authority (OJK) creating more investment instruments in a bid to help the government deal with the budget deficit to improve the quality of human resources. In addition to working toward deepening the financial market, the former World Bank managing director also pledged to create favorable policies and incentives to boost fund raising in the capital market.

Economics

Private consumption most significant growth driver for Indonesia: UOB The Business Times 3rd Sep 2019
Millennials are poised to be an important force in Indonesia which may lift growth higher, as they comprise the largest workforce, command the largest portion of the income, and correspond to unique blend of higher value consumption, according to a report by UOB. Being a mobile first and mobile only generation, the combination of millennials’ rising consumption pattern, increase in disposable income, and stellar rise of digitalisation can provide further opportunity to raise Indonesia’s overall private consumption growth. Indonesia’s consumer market is also set to witness a steady rate of expansion, driven by strong economic development, increase in disposable incomes, and most importantly the unique consumption pattern of millennials.

Rupiah holds its ground despite fall in share prices The Jakarta Post 2nd Sep 2019
The Indonesian currency gained slightly against the US dollar on Monday despite a decline in share prices in regional markets amid fears of an escalation in the trade war between the United States and China. The rupiah was trading at a Jakarta Interbank Spot Dollar Rate of 14,190 per US dollar on Monday afternoon, up from 14,237 per US dollar the previous trading day, kompas.com reported. Bank Central Asia (BCA) was selling US dollars for Rp 14,202 and buying the greenback at Rp 14,184 per US dollar.

Trade war’s ‘second wave’ will be more painful, says Indonesia finance minister BusinessMirror 29th Aug 2019
The global economy could be hit by a second wave of damage from the US-China trade war—and it will be much more severe than the first, Indonesian Finance Minister Sri Mulyani Indrawati said. The outlook for global growth already was cut amid the dispute between the world’s two biggest economies, but the escalation in hostilities since then has “created a point of no return,” Indrawati said in an interview Tuesday. Damage from this second wave “is not quantifiable at this moment” but will be significant, and could thrust the world into “a totally uncertain era.” “No one now has the trust or belief about how international disputes must and should be settled,” Indrawati said. “I think this secondary damage is going to be much, much more long lasting beyond a certain political regime.”

Indonesia surprises with second rate cut to support growth Bloomberg 22nd Aug 2019
Indonesia unexpectedly cut interest rates for a second straight month to spur an economy facing increasing risks from a global slowdown and intensifying trade war. Bank Indonesia lowered its seven-day reverse repurchase rate by 25 basis points to 5.5% on Thursday, a move predicted by only 13 of the 34 economists surveyed by Bloomberg. The majority expected the bank to keep policy unchanged after it lowered rates for the first time in almost two years in July. Governor Perry Warjiyo said the rate cut was consistent with the bank’s low inflation forecast and serves as a “preemptive measure to push economic growth momentum in the future.” The move also retains the attractive yield on domestic assets, he said.

Financial Services

OJK launches online fintech monitoring platform amid industry’s rapid growth The Jakarta Post 4th Sep 2019
The Financial Services Authority (OJK) has launched the Electronic Gateway for Digital Finance Information Systems (Gesit), which is said to be a more efficient way to monitor the development of financial technology (fintech) amid the industry’s rapid growth in the country. “This platform is in the early stages. Further developments are on their way,” OJK deputy chairman Nurhaida said in Jakarta on Tuesday. Gesit is an online registration system for fintech startups wanting to grow its business through the OJK Infinity, an innovation hub, business incubator and education center for fintech established last year.

Indonesia to raise state health insurer's premiums to plug cash deficit Reuters 3rd Sep 2019
Indonesia’s state health insurer will raise its premiums by at least 65% starting this month to plug a deficit expected to reach 32 trillion rupiah ($2.25 billion), officials said, despite protests from parliament members and trade unions. BPJS Kesehatan, which provides universal health coverage for over 200 million people regularly books claims that far exceed premiums it collects, and the burden of supporting one of the world’s biggest health systems carries a fiscal risk for Southeast Asia’s largest economy. A parliamentary commission overseeing government finances rejected the planned increase for the poor, which is going to be implemented through a presidential decree due to be issued soon, the commission chair said on Monday.

WhatsApp in talks to launch mobile payments in Indonesia U.S. 20th Aug 2019
Facebook Inc’s (FB.O) messaging service WhatsApp is in talks with multiple Indonesian digital payment firms to offer their mobile transaction services, in a bid to tap the nation’s fast growing e-commerce sector, people familiar with the matter said. Indonesia could become the second country worldwide where WhatsApp introduces such services, as it awaits regulatory approval from India, its biggest market by users, that has been delayed due to local data storage rules.

Food & Agriculture

Products labeled "palm oil-free" are banned from Indonesian shelves Bloomberg 21st Aug 2019
Indonesia, the world’s top palm oil producer and consumer, is joining Malaysia in removing anti-palm oil products from grocery store shelves. Local and imported food items that are labeled “palm oil free” or “no palm oil,” found at some high-end stores, will be removed, Penny K. Lukito, head of the National Agency of Drug and Food Control, said on Wednesday. Indonesia and Malaysia, which together make up about 85% of global palm oil supply, are upping their fight against what they say are discriminatory actions by some developed countries. They have threatened to retaliate in a potential trade war with the EU after the bloc decided to place stricter limits on the tropical oil’s use in biofuels on concerns over deforestation.

Bangka Belitung eyes farm, fishery commodity exports to East Europe Antara News 9th Sep 2019
Pangkalpinang, Bangka-Belitung (ANTARA) - The Provincial Government of Bangka Belitung Island is presently targeting to export its farm and fishery commodities comprising white pepper, eaglewood, and whiteleg shrimp to nations in East Europe. "The market of West Europe is potentially huge for the trade of white pepper, eaglewood, and whiteleg shrimp," Deputy Governor of Bangka Belitung Abdul Fatah stated in here, Monday. The government had held a meeting with the Romanian Embassy and discussed the trading assessment since Fatah considered it to be beneficial to gain broader insights into the system of export in East Europe.

Bakmi GM set to open outlets in Sumatra The Jakarta Post 5th Sep 2019
Restaurant chain Bakmi GM is set to open outlets in Sumatra and other cities in Java, according to a report by KompasTravel. The director of engineering & service division of the restaurant's holding company, PT Griya Miesejati, Widianto, told KompasTravel in Jakarta on Wednesday that it had big plans to expand to more Indonesian cities. The chain currently has restaurants in Greater Jakarta, Bandung in West Java, Surabaya in East Java, Bali, Cikarang and Karawang in West Java. "This is our big plan; to multiply our outlets in Greater Jakarta to be available in all Indonesian regions. Currently we're still concentrating in Surabaya and Denpasar; next we will expand to several cities in Sumatra and Java. It's in the pipeline; we just need to realize it," added Widianto.

Coffee farmers yet to benefit from millennial caffeine craze The Jakarta Post 3rd Sep 2019
Indonesia, the world’s fourth-largest coffee producer, is promoting good farming practices in coffee production to help farmers benefit from the caffeine craze among millennials that has swept almost all major cities in the country. A number of NGOs such as the Specialty Coffee Association of Indonesia (SCAI) and Sustainable Coffee Platform of Indonesia (SCOPI) have been actively involved in promoting good farming practices in the production of coffee in several parts of Indonesia.

Indofood firm on palm oil expansion The Jakarta Post 27th Aug 2019
Indonesia’s largest listed food and beverages company PT Indofood Sukses Makmur will go ahead with a plan to expand its palm oil business despite Citigroup’s recent decision to stop its financing facilities for the company.Indofood director Thomas Tjhie said Citgroup’s move would not affect his company’s palm oil expansion agenda. “We have no problem with the cancelation,” he told the press in Jakarta on Wednesday, adding that the company had used a small part of Citigroup’s credit facility.Thomas said a number of foreign and domestic banks would continue to provide funds for Indofood subsidiary PT Salim Ivomas despite the withdrawal of Citigroup.

Gov't Set to Redistribute 2.6mn Hectares of Forest Land Tempo 19th Aug 2019
 Coordinating Minister for Economy Affairs Darmin Nasution said the government is ready to redistribute 2.6 million hectares of forest land as part of the government’s land objects for agrarian reform (TORA).  "We are now ready to redistribute the land," said Darmin Jakarta Presidential Palace Complex, Monday, August 19. He explained two sources of land that will be distributed comprised of the Settlement of Land Control in Forest Areas (PPTKH) covering 1.2 million hectares and unproductive forest land covering 1.41 million hectares. The land that is no longer productive to be given to the community is expected to be managed as rice fields or plantations. Darmin said the government will also encourage graduates of Bogor Agricultural University (IPB) in forestry and agriculture majors to establish a group of 5 people to manage 500 hectares of land.

Health & Life Sciences

Aptorum Group announces the development of microbiome drug candidate targeting obesity and repurposed drug candidates targeting neuroblastoma Antara News 9th Sep 2019
Aptorum Group Limited (Nasdaq: APM) (“Aptorum Group”), a biopharmaceutical company focused on the development of novel therapeutics to address global unmet medical needs, announces the development of two preclinical drug candidates which target obesity and neuroblastoma, respectively. Under the recently-announced microbiota modulation platform operated by Aptorum Group’s wholly-owned subsidiary Claves Life Sciences Limited, we have commenced the preclinical development of macromolecule candidate CLS-1 targeting the treatment of obesity. CLS-1 is undergoing lead optimization and is expected to progress into the IND enabling stage in 2020.

Bitter Pill to Swallow: Should BPJS Kesehatan Increase Premium to Cover Deficit? Jakarta Globe 27th Aug 2019
The government has finally admitted a fundamental problem with BPJS Kesehatan, its much-taunted social health insurance that was launched back in 2014: it has failed to collect enough premiums from its subscribers to keep it running smoothly. bMany Indonesians often skip paying their BPJS Kesehatan premiums until they actually get sick. Those who pay their premiums regularly — including company employees and poor families subsidized by the governments — do so at a level far lower than required to sustain the system. This happened because the government was at first reluctant to put too much burden on ordinary Indonesians to keep the system alive. Conversely, it was also a strategy to rein in the amount of subsidy for the poor. The government has now agreed that the insurance premium should be set at a more realistic level next year, which could be between 50 percent and 83 percent higher than the current premium. 

Hospitals go outside Java to tap new growth potential The Jakarta Post 26th Aug 2019
Several hospital chains are expanding their business to further tap into the country’s growing demand for quality healthcare services, which have emerged as one of the most lucrative in the country.Among those that have actively expanded in recent years include Medikaloka Hermina and Mitra Keluarga Karyasehat, which target middle-income patients.Hermina, which at present operates 33 hospitals in 21 cities across Indonesia, is building three more hospitals this year and will add four more next year to achieve its target of having 40 hospitals by the end of 2020.“The three hospitals that are currently under construction are expected to open in the fourth quarter,” Medikaloka Hermina finance and strategic development director Aristo Setiawidjaja said in Jakarta on Monday.

Local hospital chains step up expansion amid growing healthcare market The Jakarta Post 22nd Aug 2019
Several hospital chains are expanding their business to further tap into the country’s growing demand for quality healthcare services, which have emerged as one of the most lucrative in the country. Among those that have actively expanded in recent years include Medikaloka Hermina and Mitra Keluarga Karyasehat, which target middle-income patients. Hermina, which at present operates 33 hospitals in 21 cities across Indonesia, is building three more hospitals this year and will add four more next year to achieve its target of having 40 hospitals by the end of 2020. “The three hospitals that are currently under construction are expected to open in the fourth quarter,” Medikaloka Hermina finance and strategic development director Aristo Setiawidjaja said in Jakarta on Monday.

Higher healthcare premiums ‘urgent’, BPJS Kesehatan pleads as finances bleed The Jakarta Post 22nd Aug 2019
With a ballooning deficit over five years of operations putting pressure on the state budget, the Healthcare and Social Security Agency (BPJS Kesehatan), which is in charge of Indonesia’s universal healthcare insurance system, is pleading for an increase in premiums. BPJS Kesehatan's director of finance and investment, Kemal Imam Santoso, acknowledged that the increase in premiums would only address one of the many problems that cause a growing deficit in the institution’s finances. However, he said it is necessary to stem the financial losses suffered by the state insurer. “The need is quite urgent,” Kemal told the press after a meeting with House of Representatives’ Commission XI which oversees state budget and overall financial affairs, which was also attended by Finance Minister Sri Mulyani Indrawati.

ICT

Kominfo to Revoke Internet Restriction in Papua on Conditions Tempo 22nd Aug 2019
Communication and Informatics Ministry (Kominfo) decided to apply a temporary block on internet access in Papua and West Papua Province following the mass demonstration that continued until Wednesday, August 21. The ministry’s spokesman Ferdinandus Setu said his institution set two conditions before revoking the network restriction. “First, after the situation returns to normal,” said Ferdinandus or Nando to Tempo, Thursday, August 22. Nando explained the normal situation means no riot or people staging a rally in the street.

Sri Mulyani to Call in Rudiantara to Discuss IMEI Regulation Tempo 21st Aug 2019
Finance Minister Sri Mulyani Indrawati said she did not have detailed information on the International Mobile Equipment Identity or IMEI policy initiated by Communication and Informatics Ministry or Kominfo. Kominfo earlier claimed the regulation which is aimed to suppress the sales of black market cell phones was being consolidated with the Finance Ministry in light of the taxation. “I have just checked to Taxation Directorate General, we would like to check it too to Pak Rudiantara (Kominfo Minister) what he means with this taxation,” said Minister Sri in the Parliament Complex, Senayan, Central Jakarta, Tuesday, August 20.

Kominfo Spots 2 Hoaxes about Surabaya Incident Involving Papuan Tempo 20th Aug 2019
Communication and Informatics (Kominfo) Ministry has identified two hoax contents related to the raid against Papuan university students in Surabaya, East Java. “Hoaxes spread through social media and instant messaging,” said the ministry’s spokesman Ferdinandus Setu in a written statement in Jakarta, Monday, August 19. The first hoax was about the photo of Papuan student claimed to have died after being attacked by law enforcers in Surabaya. The photo displayed a man fell on the floor with a caption saying “1 victim has died because of beaten by security officers, TNI/Polri. Papuan Student in Surabaya.”

Sri Mulyani Challenges Millennials to Develop Apps for Gov't Tempo 19th Aug 2019
Finance Minister Sri Mulyani Indrawati said millennial generation has the opportunity to help the government by establishing a startup company. Moreover, the government needs a tool, either an information system or an application, that enhances its performance accountability. "How do we know when we distribute hundreds of trillions of operational costs will really help the people. I wonder with digital technology. You have ideas. For state finance affairs, public accountability is truly necessary," Sri said at Istora Senayan, South Jakarta, Sunday, August 18. She conveyed the statement when attending a national movement "Ignite The Nation. 1000 Startup Digital Indonesia" as one of the mentors. The event was held as the government’s effort in encouraging the growth of the startup industry, which is currently thriving among young people.

Bank Indonesia Launches QR Code Standards Tempo 19th Aug 2019
Bank Indonesia (BI) has launched the Quick Response Indonesian Standard (QRIS) for digital payment services through server-based electronic money applications, electronic wallets, and mobile banking. Bank Indonesia governor Perry Warjiyo said the use of QRIS provide many benefits and convenience for banks, service providers, customers and merchants. "Everyone is benefited from the efficiency, as well as transactions that are integrated with these standards," he said, last weekend.

Gov't Re-opens Internet Access in More Papua's Districts Tonight Tempo 10th Sep 2019
The Indonesian government has decided to re-open internet access in two Papua districts, namely Mimika and Jayawijaya. The government initially closed internet access throughout much of Papua and West Papua after rioting in the region, citing wanting to stop the spreading of "hoaxes" on the internet and social media. There remain a few regencies/cities that do not have internet access, but the internet has been re-opened in the majority of regencies/cities in both Papua and West Papua.

More local companies migrate to cloud computing to boost business efficiency The Jakarta Post 10th Sep 2019
Cloud computing, the on-demand availability of computer system resources, especially data storage and computing power, is becoming more popular among business players in the country, from the most profitable bank in the country to retail start-ups. The technology not only provides large storage capacity but also speeds up data processing, thereby improving cost efficiency. The Government of Indonesia has simultaneously passed legislation requiring data centers to be located within the country. Although there are reports that the government is drafting revisions to the law.

XL to expand network to cover 95% of population in 2019 The Jakarta Post 9th Sep 2019
Publicly listed telecommunications operator PT XL Axiata is planning to reach 95 percent of Indonesia’s 260 million people by building and operating more base transceiver stations (BTS) across the country. The company’s technology director, Yessie D. Yoseta, said XL Axiata had completed 90 percent of its planned network infrastructure development for 2019 in the first six months of the year by installing 19,000 new BTS, mostly in areas outside Java.

Govt, private companies push for digital transformation of MSMEs The Jakarta Post 7th Sep 2019
The government and private sector actors such as banks and financial start-ups are making fresh efforts to further promote the digitalization of micro, small and medium enterprises (MSMEs), which have become the backbone of the country’s economy.The Industry Ministry recently launched Startup4Industry, an application that gives MSMEs easier access to affordable and feasible technological solutions from technology start-ups.

As payments become more digitalized, cyber security is paramount: BI The Jakarta Post 5th Sep 2019
Bank Indonesia (BI) continues to campaign for a '"less-cash society" with the recent launch of a centralized QR standard and further development of the national payment gateway, implementing “international security standards” to contain cybersecurity risks. Starting January next year, the Quick Response Indonesian Standard (QRIS) will integrate existing QR-based payment apps such as Go-Pay and OVO to boost cashless transactions and promote financial inclusion in the country, said BI payment system policy executive director Pungky P. Wibowo.

Market Regulation

Global nickel supply to drop on Indonesia's ore export ban Reuters 4th Sep 2019
Indonesia said on Monday it will stop nickel ore exports from Jan. 1, 2020, two years earlier than initially indicated, as it speeds up efforts to process more of its resources at home. Bambang Gatot Ariyono, the director general for coal and minerals at the Ministry of Energy and Mineral Resources, said the ban will be applicable to all grades of nickel ore and ordered exporters to stop shipments from that date regardless of standing contracts."That is why we are announcing now so they have four months of transition time," Ariyono told reporters. Nickel prices have surged on speculation about an expedited ban and Monday's announcement. The three-month nickel contract on the London Metal Exchange rose as much as 5.3% to $18,850 a tonne on Monday, its highest in nearly five years, adding to Friday's 9% gain.

Indonesia's Nickel Ban Shows Resource Nationalism on the March Bloomberg 2nd Sep 2019
Indonesia will enforce a complete ban on the export of raw nickel ore from Jan. 1, two years earlier than planned, as the nation seeks to lock in supplies for dozens of smelters that are under construction and buttress a drive to build out local processing capacity, an official said. The suspension is also in line with a plan to preserve low-grade nickel ore containing cobalt and lithium for use in electric batteries, Bambang Gatot Ariyono, director general for mineral and coal at the Energy and Mineral Resources Ministry, told reporters on Monday. Miners with outstanding permits to export nickel ore may ship the mineral until the year-end, he said.