Garuda to Purchase 11 New Planes this Year

Transcription

The President Post
T H E
S P I R I T
O F
I N D O N E S I A
Display until February 17, 2011 /// N0. 20
www.thepresidentpost.com
As one of the country’s
finest sons, Juwono
Sudarsono leads a
very rich life, playing
key roles in serving his
country. He has made
his marks with many
achievements and
contributions intended
for the betterment of
the nation.
PLN Chief Slams
Industrialists for Not Using
Common Sense
Dahlan Iskan, president director of state
electricity company PT PLN, has accused
Indonesian industrialists of being spoiled
and not using their common sense in rejecting the new basic electricity tariff for
industry.
“They just want to keep their own industries alive and leave the electricity industry
in distress. They keep on wanting to be
pampered and lulled to sleep by lullabies,”
Iskan said in a press release issued by PLN
last week.
Dahlan Iskan
Dahlan`s statement was issued two
days after the chairman of Indonesian Employers Association (Apindo) Sofjan Wanandi said last Thursday that the
industrial sector was considering to switch business to importing goods
from overseas instead of producing them in light of the power rate hike
for the industrial sector.
J
uwono devoted much
of his time to the country’s education sector.
Juwono served as Minister of Education and
Culture in President BJ
Habibie’s Cabinet of Reformation
(May 1998-October 1999), he is
a professor at University of Indonesia since 1998, he taught at The
School of Public and International Affairs, Columbia University, New York City from 1986 to
1987 and he did a three-year stint
as vice governor at the National
Defense Institute (Lemhannas)
from 1995 to 1998.
Prof. Juwono is the youngest
son of the late Dr. Sudarsono,
a prominent diplomat and former social affairs minister, minister of home affairs, and Indonesia’s ambassador to Yugoslavia.
After completing primary school
in India, he studied at a junior
high school in Cikini, Jakarta,
and went to England to finish his
high school.
Juwono graduated from University of Indonesia, Jakarta
(B.A., M.S.); Institute of Social
Studies, The Hague, Netherlands; University of California,
Berkeley, USA (M.A.) ; and The
London School of Economics,
UK (Ph.D).
During President Soeharto’s New Order regime Juwono
served as State Minister of Environment (1997-1998), Minister of
Defence under President Abdurrahman Wahid (October 1999 August 2000), he was assigned as
ambassador to the United Kingdom during President Megawati
Soekarnoputri’s administration
(June 2003 - October 2004), and
again served as Defence Minister
during President Susilo Bambang
Yudhoyono’s first term as president (21 October 2004 - 20 October 2009).
This year, Prof. Juwono is reengaged in the education world.
He has been appointed as Chairman of President University
Foundation.
Prof. Juwono is one of the
founders of President Universi-
Juwono Sudarsono:
The keys to success are innovation, implementation and
commercialization through partnership with private companies
ty Foundation, which conceptual
plan as President University was
formulated in September 1997
by Setyono Djuandi Darmono,
President Director of PT Jababeka Tbk., and Prof. Donald W.
Watts, who was at the time President of Bond University, Queensland, and Vice Chancellor of
Curtin University, Australia.
As the Chairman of PU Foundation, “I will emphasize on the
importance of training future
managers and lecturers by stressing on planning and transparent
financial management. This is
crucial,” said Juwono.
According to him, “a university
should offer an attractive teaching method, alluring, and in line
with social reality. There should
be a balance between imagination and an ability to act, so that
the brain and the ability to act
can induce exhilarating spirit of
lecturers, students, PU staff. Excellent graduates can only spring
out from campus members who
are proud of those elements.”
Universities also need to help
the government to reduce unemployment rate by continuously providing jobs in the manufacturing sector. One of the
advantages offered by PU is its location. It is located in the heart
of the largest industrial area in
Southeast Asia.
Prof. Juwono attributed Japan’s, South Korea’s, China’s and
India’s robust economic growth
to their leaders’ vision and awareness on the importance to build
world class universities.
“10% of the workforce in those
countries transformed themselves
from agriculture-based to science
and technology-based. Their economic structures changed from
secondary industry researchbased into economies based on
research, technology science and
services. The keys to this success
are innovation, implementation
and commercialization through
partnership with private companies,” said Juwono.
With regards to problems in
Indonesia’s education sector in
general, Juwono said the most
fundamental problem is access to
basic, intermediate, and high education that can further unite Indonesians.
“President University is a college of multi-ethnic, interfaith,
cross-regional, interracials and inter-civilization. PU is not marked
by a certain religion, tribe or a
a particular region. PU has 5
dimensions: local, provincial, national, regional and international,” he explained.
On Indonesia’s preparations to
compete in the free trade era, Juwono said we should “strengthen PSM education (professional
science management) so that everyone in echelon 2, 3, and 4, the
public in general and the private
sectors can understand the im-
Garuda to Purchase 11 New Planes this Year
National flag carrier Garuda
Indonesia plans to buy 11 new
planes this year with the first delivery expected in February or
March.
The planes consisted of nine
Boeing 737-800s and two Airbus 330-200s, Garuda Indonesia Technical Director Hadinoto
Soedigno said here on Thursday,
Antara reported.
The nine Boeing 737-800s
would be delivered in stages starting February or March, and the
two Airbus 330-200s would be
delivered in April and October,
he said on the sidelines of a roadshow for the airline`s initial public offering.
He said Garuda, which currently has a fleet of 87 planes, expects to operate 130-150 planes
in the next five years.
With the targeted fleet of
130-150 planes in 2015, Garuda would buy a minimum of 10
planes in each of the next five
years, he said.
THE ECONOMY
BUSINESS
Government to Reduce
Unemployment by 0.5% in
2011
IDR 20,000
Garuda is expected to list its
shares with the Indonesia Stock
Exchange on February 11. The
company`s chief financial officer Elisa Lumbantoruan said on
Wednesday about 80 percent of
the proceeds of the IPO would be
spent on expanding the airline`s
fleet and 20 percent to finance its
State Companies Control
26% of Stock Market Capital
The government has set itself
the target of reducing the
unemployment rate by 0.5 percent
from 7.5 percent in 2010 to 7
percent this year.
Seventeen state-owned
companies listed at the Jakarta
Stock Exchange (BEI) control
26 percent of the market`s total
capital, State Enterprises Minister
Mustafa Abubakar said.
PAGE A5
PAGE B1
capital expenditure.
Hadinoto said Garuda would
operate its Boeing planes to serve
its domestic flights such as Jakarta-Gorontalo via Surabaya and
Makassar, Surabaya-Balikpapan,
and Surabaya-Ampenan.
Meanwhile, the Airbus planes
would be used to serve its regional routes which would be opened
soon, including Jakarta-Manila
and Jakarta-Taiwan, he said.
“If we are asked whether we are
interested to take over the routes
left by Mandala, the answer
would be yes,” the company`s
marketing vice president Don
Jusuf Palito said on the sidelines
of the launching of Boeing 737800NG here on Saturday.
PT Garuda Indonesia is interested in flying the routes abandoned by Mandala which recently suspended its operations due to
financial problems.
Garuda on Saturday started operating New Boeing 737800NG with 156 seat capacity to
serve the route to Kuala Lumpur,
Malaysia, twice day.
“We see good market potentials in Malaysia. Garuda also
plans to expand to Penang, Johor
and other destinations in Malaysia,” Don said.
TECHNOLOGY
ECONOMIC REVIEW
Mandala routes
Getting Ahead: How
Indonesia is Using ICT
to Boost its Standing Among
its Neighbours
Government to Boost
Manufacturing, AgroIndustry Sectors in 2011
SThe Indonesia’s government
believes that IT is an essential
driver of competitiveness and
national economic growth.
This was announced recently by
Minister of Development Planning
and Chairperson of Bappenas who
is upbeat about the government’s
ability to spur growth this year.
PAGE B5
PAGE C1
portance of having competitive
products on the basis of technical
understanding, quality and prices that will change with innovations. Having PSM educationequipped echelon 2, 3 and 4 are
more important than any agreements clinched by ministers, director generals or CEOs of private companies.”
“Now the situation has
changed because not all overseas
graduates are better than home
graduates. It highly depends on
what university they graduated
from and their own characters,”
he elaborated.
Furthermore he added, “most
important is whether or not those
graduates can create a job for
themselves and help to create jobs
for others. But in facing global competition that leads to science-based economy, technology,
knowledge and services, PU has
already mapped out Indonesia’s
economic structure for the next
20-30 years.”
Finally, Juwono hoped that access to basic education can be enjoyed by children across the country, from Aceh to Papua, North
Sulawesi to East Nusa Tenggara.
Wanandi claims producing goods domestically had become more
costly due to the high price of electricity after the lifting of the 18 percent
ceiling on electricity tariff hike by PLN.
Dahlan said other industries whose number is bigger have paid electricity tariff on normal rates without asking for a special treatment such as
ceiling for any hike to be introduced by PLN.
“If the argue the lifting of the ceiling would diminish their competitive
edge, then why are similar industries that have paid electricity on normal
rates remain competitive?” he wondered.
Dahlan goes on to say that if the pampering of the industrialists is not
opposed, then the Indonesian people would never be able to progress.
He adds that the industrialists opposing the ceiling have also been
voicing an impression that the entire industrial sector as a whole would
be affected by the hike ceiling lifting, which he insists is not true.
President, PLN chief meet
President Susilo Bambang Yudhoyono and state electricity company
PT PLN President Director Dahlan Iskan did not discuss the electricity
rate capping issue at their meeting at the State Palace on Monday.
“The president will go to Asahan on Tuesday, and PLN is building a
power plant in Asahan but the meeting had nothing to do with the capping issue,” Coordinating Minister for Economy Hatta Rajasa said on
Monday.
Hatta added that on the capping issue, he had asked energy and mineral resources (ESDM) minister and state minister for state enterprises
(BUMN) to avoid a polemic and to have the issue settled.
“There has been no revocation. I have asked ESDM and BUMN ministers at a coordination meeting to resolve the issue,” Hatta said.
President Susilo Bambang Yudhoyono summoned state electricity
company PT PLN President Director Dahlan Iskan to the State Palace on
Monday morning for a closed door meeting.
Presidential spokesman Julian Aldrin Pasha said that at the brief meeting with President Yudhoyono, Dahlan only reported about the progress
of PT PLN.
1,000 New Motorbikes
Flood Jakarta Every Day
About 1,000 new motorcycles hit Jakarta`s streets every day
due to the city`s high economic growth, Jakarta Governor Fauzi
Bowo said here this week in remarks at the opening of a Young
Entrepreneurs Forum here.
He said Jakarta`s fast economic growth was related to its
residents` purchasing power, but the increasing numbers of cars
and motorbikes could have a negative effect in contributing to the
city`s traffic problems, Fauzi said.
He said the city administration could not make any policy
without considering matters related to the increasing number of
motorbikes.
The President Post
A2 January 17, 2011
Viewpoint
Reviving Indonesia’s Maritime Spirit
By Ir. Martono Yuwono
REGOM (reinventing government administration)
is a reform movement and transformation of city
administration management introduced by the
United States government as a development
breakthrough to boost efficiency, effectiveness and
government management performance.
T
he approach was later introduced to other countries, both
developed and developing countries.
REGOM consisted
of three approach principles, (1)
de-bureaucratization; (2) financial, organization and management restructuring and (3) privatization.
In developing a city, many advanced nations adopted this principle on areas with certain characteristics that have strong selling
points, such as core city areas,
hearts of the city, old ports, areas
with historical backgrounds, waterfronts and more. The reason
being, the locations are deemed
to have strategic values, offering certain gimmicks/genus loci
which are non-renewable, highly
controlled, priceless, such as heritage value, waterfronts, harbor
fronts/harbor sides, inner downtowns, main street corridors and
more. The movement is also often linked to prestigious missions
that carry themes such as “awakening”, reflecting on past glo-
ries that can instil a development
spirit with terms like revitalization, rebirth, renaissance, regeneration, reshaping and more.
The success of this movement
is usually contributed by a driving factor. In England, for example, it is associated with a privatization policy breakthrough
which was massively launched by
Margaret Thatcher through Action for Cities, which was aimed
to restore pride to the city (to discover the sense of civic pride).
Action for cities targets is to reorganize inner cities with the
REGOM approach as a ”participatory” strategy that involved
all ”stakeholders” in city development. To achieve the goal,
Thatcher formed an action group
which consisted of action men
and established the Urban Development Corporation, an independent body that runs core city
areas in six cities, including London, Liverpool and Thyne.
The facilities created to support the programs were: (1) urban
programs that regulated government-private sector-public cooperation: (2) urban development
grants to help fund development
of old city areas; (3) urban regeneration grants to help private sectors to develop former industrial areas; (4) derelict development
grants to help the private sector in
purchasing abandoned industrial
estates; (5) land registers to provide information on abandoned
estates in cities and other regulations. London Dockland in London and Albert Dock in Liverpool, England, were two success
stories of this approach.
The REGOM movement synergy, which is aimed at strategic
areas in city development, was a
new phenomenon launched by a
visionairy utopian, who efficiently motivated developments that
generated wide participation,
including triggering a national movement. Participation and
transparancy, as elements to support democracy in development,
carried a strategic meaning that
could potentially create a sense of
belonging to all players involved
in the development process. The
effectiveness of REGOM highly depended on all factors mentioned above.
The same spirit was also adopted by Yayasan Pelestari Budaya Bangsa (YPBB), which carried
out a pilot project for Indonesia to reorganize Bandar Nusantara. Bandar Lama Sunda Kalapa
was chosen as a pilot model. The
first step was to design a master
plan to accommodate common
aspirations by reaching a consensus among development executors by involving development
consultants and NGOs to serve
as advocates in every aspect of
the development in a partnership
environment: (1) government
sector, with consultancy team
(development consultant as fa-
cilitator) for city areas; (2) private
sector: KWB Sunda Kelapa business community; (3) community sector, with non governmental organizations as community
facilitator, in this case Kampung
Nelayan Tradisional Luar Batang
as the pilot model. The “Kampung Luar Batang” community development program was a
nine-year project (1988-1997),
which could be categorized as an
initial step to participatory development which grew purely from
the grassroots in Jakarta.
The establihment of a special body in the development of
PANTURA area which carried
”The Revival of Jayakarta” as its
theme, could potentially lift the
area or parts of it with a specific value, as a pilot model in the
implementation of REGOM.
The project was funded by the
Bremen Overseas Research Development Agency (BORDA) as
was proposed by the Yayasan Pelestari Budaya Bangsa.
A globalization spirit indicates
an urgent need for an anticipatory policy strategy that emphasizes on empowerment of city external functions. A counter strategy
which requires professionalism
and modern city management
quality is supported by strong political will to build a ”fortress of
maritime spirit” of Bandar Nusantara from Sabang to Marauke
in response to the upcoming
global era as the main target.
Bandar Nusantara is waiting
for a touch of participative development as stated above. The
rebuilding of Sunda Kelapa reminds us of the Baltimore revival efforts during the economic recession. The initiative launched
by Jakarta can serve as a lesson
for other Bandar Nusantara pilot projects from Sabang to Marauke that displayed an effort by
a city administration to implement structural reforms as a survival strategy to overcome urbanization pressure and to preserve
culture.
The Genderang Bahari was
formed as a task force that carried
a patriotic mission called ’Kebangkitan Semangat Bahari Indonesia’ or the Rediscovery of the
Indonesian maritime spirit under a theme ’A decade of achievements 2010–2020’, with Bandar
Nusantara as a symbolic ”light
house” to welcome the challenging global era in 2020.
The Genderang
Bahari was formed
as a task force that
carried a patriotic
mission called
’Kebangkitan
Semangat Bahari
Indonesia’ or the
Rediscovery of the
Indonesian maritime
spirit under a
theme ’A decade
of achievements
2010–2020’, with
Bandar Nusantara
as a symbolic ”light
house” to welcome
the challenging
global era in 2020.
The birth of Genderang Bahari
was spontaneous and took place
during the 65th commemoration
of Proclamation of the Republic
of Indonesia at Sultan Hotel, Jakarta, initiated by maritime advocates driven by the awareness
and the need to revive the maritime spirit as a mandate which
is believed to have the power to
guide younger generations to face
the future with aplomb.
The idea was written down
during the commemoration of
Hari Nusantara on 13 December
2010 and is expected to touch our
hearts as citizens of an archiplegic
nation to reach the future with
greatness and glory of our marine
predecessors.
The writer is secretary general of
Genderang Bahari, a task force with
‘a patriotic mission to rediscover the
Indonesian maritime spirit’.
DEVELOPING SUSTAINABLE INFRASTRUCTURE ACROSS THE PROVINCES
A KADIN INITIATIVE
CONTACT :
PT Infrastructure Asia
Kantor Taman A9 Unit C7 Lt. 3
Kawasan Mega Kuningan, Jakarta 12950 - Indonesia
T +62 21 576 4440 | F + 62 21 576 4552
info@indonesiainfrastructure.org
MEDIA SUPPORT :
12 - 14 April 2011
Balai Sidang
Jakarta Convention Center
Jakarta, Indonesia
“We are committing USD 50 billion from a budgetary
standpoint for the development of infrastructure as part
of a USD 150 billion five-year program”
HE Gita Wirjawan, Chairman of the BKPM
Knowledge@Wharton July 21, 2010
Indonesia International Infrastructure 2011 Conference & Exhibition (IIICE 2011) is the only event in Indonesia
to stage the full potential for sustainable infrastructure growth in each of the 33 provinces of the Indonesian
archipelago alongside national priority planned projects for tender by the central government.
Attend IIICE 2011 to review the full range of current and future infrastructure projects with Governors and Senior
Infrastructure Development Officials from the 33 Indonesian Provinces together with Central Government Senior
Officials related to infrastructure development.
Don’t miss the opportunity to involve your company in the five-year program
to develop infrastructure in Indonesia!
www.indonesiainfrastructure.org
The President Post
A4 January 17, 2011
The Economy
ECONOMIC UPDATES
RI, S. Korea agree to double
bilateral trade
Hatta Rajasa
Indonesia and South Korea have agreed
to double their bilateral trade over the next
five years.
The agreement was reached during a
bilateral meeting between President Susilo
Bambang Yudhoyono and his South Korean
counterpart Lee Myung-Bak on the sidelines of the Bali Democracy Forum here last
month.
Trade between the two countries is at
around US$20 billion.
2.5 million tons
Target of Rice
Coordinating Minister for Economic Affairs Hatta Radjasa said South Korea had
also expressed its wish to increase its investment in Indonesia.
He said the decision to increase investment would only be known next
year after the establishment of a special team to identify investment potentials in Indonesia that South Korea could exploit.
The Government has set
a target of rice production
amounting to 30.9 million
tons of dry grain for
January–April. Bulog will
absorb 2.5 million tons of
rice from farmers until May
2011.
RI migrant workers’ remittances
reach US$5.03 billion
Bank Indonesia (BI) reported that per September 2010,
Indonesia`s migrant remittances
totaled US$5.03 billion, up 2.44
percent from US$4.91 billion US
dollar in last year`s same period.
Difi A Djohansyah, a spokesman of the central bank, said last
month that per September 2010,
Indonesia has sent 427,000
workers abroad, down 12 percent from 479,000 workers in the
same period in 2009.
With the additional workers, the total number of Indonesian workers
abroad in September 2010 reached 4.32 million people.
Since 2005, Bank Indonesia in cooperation with the manpower and
transmigration ministry and the National Agency for the Placement and
Protection of Overseas Labor`s (BNP2TKI), has monitored the placement
of Indonesian workers abroad.
Sultan Thaha to become
international airport in 2012
Sultan Thaha Airport of Jambi Province is being developed into an international airport in 2012.
“There will be major developments for the airport in 2011, initiated by
designing some facilities required for the airport,” the Head of Transportation Office of Jambi Province, Benhard Panjaitan said last month.
The fund for the airport development and construction will come from
State Budget, Regional Budget and the budget of PT Angkasa Pura.
The runway, which will be 30 meters wide and 2,220 meters long, will
be expanded to 45 meters and 2,400 meters respectively.
The runway expansion is urgent as the airport planned to serve for big
airliners which require a runway with a width 35 meters and a length of
2,400 meters.
“One of the important facilities to realize the international airport is an
Instrument Landing System (ILS) to guide airliners while landing in bad
weather,” Benhard said
Two power plants in Jayapura
to operate in 2011
Two power plants which have been built in recent years by state electricity company PT PLN`s Jayapura region will start operation in mid-2011,
director of PT. PLN, Dahlan Iskan, said here last month.
“It is hoped that in mid-2011 Holtekamp thermal power plant and Orya
hydropower plant will become operational,” he said.
“When these two power plants have become operational, PLN Jayapura region will save tens of billions of rupiahs a month or half a trillion
rupiahs a year,” he said.
The Holtekamp thermal power plant is located in Muara Tami sub district, Jayapura city and the Orya hydropower plant in Genyem sub district,
Jayapura district with a capacity of 200 megawatt each.
Photo: The President Post/Nandi Nanti
RI Upbeat on 2010
Economic Performance
By 2030, Indonesian per capita income would
be US$17,000 based on the robust Indonesian
economy that has sustained consistent growth
since 1970
C
oordinating Minister for Economy
Hatta Rajasa said
last month that
Indonesia`s economy is ranked 16th in the
world, above previous projections.
“The prospect of Indonesian economy will be better
than previously projected,”
said Minister Rajasa.
Citing Bank Indonesia data, he
said that the Indonesian economy grew 6.0 percent in 2010 and
was expected to grow 6.5 percent
in 2011.
By 2030, Indonesian per capita income would be US$17,000
based on the robust Indonesian economy that has sustained
consistent growth since 1970, he
said.
China has been reported to become interested in
making an investment in
ports in Papua.
“On January 5, 2011, a
Chinese representative mission will meet the Papua
administration in Jayapura,” Transportation Minister Freddy Numberi told the
press prior to an economic evaluation meeting at the
economic coordinating ministry here last week.
Freddy said China was in-
gas processing industries will experience an above-target growth
rate,” Hidayat said at year-end
press conference here last week.
MS Hidayat
Indonesia`s industrial growth
in the third quarter of 2010 was
recorded at 4.69 percent, boosting confidence that the target figure of 4.65 percent for the whole
year will be easily surpassed, Industry Minister MS Hidayat said
last week.
“Considering the continuous positive trend in industrial growth until the 4th quarter
of 2010, we believe non-oil/non-
The recovery of the global
economy is seen by the performances of industrialized countries such as the United States
and Japan as well as regional economic giants China and India,
all of which brought positive im-
pacts to their trading partners,
including Indonesia.
However, Minister Rajasa admitted that the positive development on the economic sector had
not had a positive impact on poverty reduction in all regions of Indonesia.
“Therefore, there should be a
way out (to deal with poverty issues), something that the central
government and regional governments must address,” he said.
Poverty and unemployment
rates could not yet be reduced significantly over the past years.
In 2005 poor people in Indonesia amounted to 118 million,
or 53.8 percent of the total population.
China Interested in Building Ports in Papua
terested in port projects in Papua
and West Papua.
He said the meeting discussed
Chinese investment opportunities in Papua and West Papua.
The Papua governor will also
brief the Chinese mission on the
potentials in Papua.
Freddy said cooperation
with China is covered by a
government`s plan to promote
public private partnership (PPP).
Freddy added the meeting will
be attended by nine companies to
Industrial Growth in 2010
Expected to Surpass Target
The highest growth
achievers in the
industrial sector
were transportation
vehicles, machinery
and their spare
parts that grew 8.47
percent, fertilizer,
chemical and rubbergoods products (4.82
percent) and other
industrial goods (3.83
percent).
“At the end of this year, the per
capita income will already reach
US$3,000. This figure is beyond
the target of the government,” he
said.
In addition to strong domestic
demands, the positive Indonesian
economy had also been influenced by the recovery of the global economy as reflected by the
growth in export since the fourth
quarter of 2009.
He said the non-oil/non-gas
processing industry sector had
grown significantly in 2010 compared with 2009 when it grew
only 1.54 percent.
Industrial growth in 2010 had
also moved closer to the national economic growth figure which
was recorded at 5.82 percent in
the third quarter of 2010.
“This shows that the industrial sector has become a sufficiently high source of growth in the
overall gross national product,”
said the minister.
The highest growth achievers in the industrial sector were
transportation vehicles, machinery and their spare parts that
grew 8.47 percent, fertilizer,
chemical and rubber-goods
products (4.82 percent) and
other industrial goods (3.83
percent).
The industrial sector made
68.8 billion US dollars from
export of manufactured
products, or 62.07 percent
of the overall earnings from
exports, and 34.10 percent
higher than a year ago.
Investment in the industrial sector was registered at
17.03 trillion rupiahs for domestic investment (PMDN)
and 2.5 billion US dollars
for foreign investment during the period.
The manufacturing industries sector in 2010 employed 14.4 million people,
or an increase of 386,640
from the figure in 2009.
witness the potentials in Papua.
Besides companies having to
do with ports, he added, those
engaged in cement and mining
had also become interested in the
meeting.
He said China was also interested in developing airports
there.
“The airports in Manokwari,
Jayapura, Sorong, and Biak will
be revived like in Mimika,” he
said.
He added that Papua will have
new ports in Jayapura, Sorong
and Biak.
“The three areas are being prepared to have new international
ports,” he said.
At present, he said, the construction of basic infrastructure
has already started. He said the
coastal area will be reclaimed
with funds from the State Budget.
“We are hoping China would
take part in the development of
the region,” he said.
Banking
Loans
Grow 22%
The amount of banking loans
extended in the year up to the
second week of December
2010 reached Rp1,708.15 trillion, up 22.76 percent year-onyear, Bank Indonesia (the central bank/BI) said.
In the past week alone,
the amount of banking loans
reached Rp7.22 trillion consisting of Rp4.04 trillion in rupiah
and Rp3.18 trillion in foreign
currency, BI spokesman Difi A
Johansyah said last week.
Difi A Johansyah
As such, the amount of
banking loans rose Rp277.95
trillion or 19.43 percent year-todate (ytd) and Rp316.73 trillion
or 22.76 percent year-on-year
(yoy), he said.
The increase in the amount
of banking loans in foreign
currency originated from four
groups of banks (private banks,
branches of overseas banks,
joint venture banks and regional
government-owned bank), he
said.
However, state-owned banks
recorded a Rp0.15 trillion decline in the amount of banking
loans in foreign currency.
The central bank noted that
during the reporting week the
amount of banking loans in foreign currency rose US$0.36 billion with branches of overseas
banks recording the highest
increase of US$0.12 billion.
2011 Micro Credit
Target at Rp20 Trillion
The government is targeting the disbursement of Micro Credit Support (KUR)
in 2011 to total Rp 18-20
trillion, up from Rp16.4 trillion in 2010.
“Each year the amount
is increasing,” State-owned
Enterprises Minister Mustafa Abubakar said in Jakarta
last weekend.
This year the government
has chosen six state-owned
banks, Bank Negara Indonesia, Bank Rakyat Indonesia (BRI), Bank Mandiri, Bank Tabungan Negara,
Bank Bukopin, Bank Syariah Mandiri and 13 regional
banks to distribute the micro credit.
BRI recorded the biggest
credit distributor last year
with 9.7 trillion, or half of
Mustafa Abubakar
the total KUR.
Bank Mandiri distributed
Rp1.7 trillion during 2010. Half
of the total loans were taken out
by those in the agriculture and
animal husbandry sector with
42,000 debtors, while more than
35% of those loans were taken
out by those in the trade sector,
with more than 12,000 debtors.
According to Mustafa, since
KUR allocation began in 2007,
total credit received by micro entrepreneurs amounted
to Rp33.4 trillion.
Soft loans were taken out
by more than 3.8 million
debtors, which employed 6.7
million workers.
The limit of the loans
without collateral varied to a
maximum of Rp20 million
per debtor, an increase from
the previous Rp5 million.
Microcredit is expected to
increase the number of Indonesian entrepreneurs, which
is only 564,000 people or
0.24 percent of 163 million
people of working age.
“We need at least 4 million new entrepreneurs because we want to increase
competitiveness,” said Coordinating Economic Minister
Hatta Rajasa.
The President Post
January 17, 2011 A5
The Economy
Govt to Reduce Unemployment
by 0.5 percent in 2011
The government has set itself the target of
reducing the unemployment rate by 0.5 percent
from 7.5 percent in 2010 to 7 percent this year.
P
resident Susilo Bambang Yudhoyono
made the statement
when giving the
targets of national
development in the
2011 government plan of action
before all cabinet ministers, governors, district heads, and mayors at a working meeting here last
week.
President Yudhoyono also said
the government would also reduce the poverty rate from 13
percent to about 12.5 or 11.5 percent this year.
In connection with financial
resources, the head of state said
2011 state budget rose by 9.2 percent from the last year`s budget to
Rp1,229.6 trillion this year.
But the president added that
the rise of state budget was balanced by an increase in state revenue.
“Our state revenue rises 11.3
percent from that in the previous year and it can reduce budget
deficit,” the president said.
Meanwhile, Finance Minister Agus Martowardojo said
early this year that budget deficit in 2010 state budget reached
only Rp39.5 trillion or 0.62 percent from previous estimation of
Rp133 trillion or 2.1 percent.
He also said the remaining
budget financing (SILPA 2010)
was Rp47 trillion and corrected a
prediction of Rp23.2 trillion that
he made a week ago.
Indonesians have been warned
to beware of global crisis issues
that could have a serious impact
on its economic growth, President Yudhoyono said.
“We have to beware of three
crises that could trigger disputes
among global countries. They
are food supply, energy and water,” the President said.
The government would reduce the poverty rate from 13 percent to about 12.5 or 11.5 percent this year, said
President Yudhoyono at a working meeting here last week.
In the backdrop of the still uncertain global economic
and financial conditions the board of governors of Bank
Indonesia still believed the country`s economy could grow
6.0 percent in 2010.
ing is `Fair and Just Economic
Growth Acceleration Supported
by Determination on Management and Synergy between Central and Regional Governments.
The achievement was boosted by economic growth in
the fourth quarter of 2010 which was predicted to reach
6.1 percent or higher than in the previous quarter.
“RI more successful in
development in 2011”
“For the year 2011, we need
to be optimistic that our development programs will be much
more successful. There are four
factors that enables us to boost
our country`s development,” he
said.
President Yudhoyono said the
first factor was related to the
country`s ongoing growth momentum.
The second factor is Indonesia’s great potential to be an ad-
RI to Boost Non-Oil/Gas
Exports to Cover Trade Deficit
In 2010, Indonesia exported non-oil and gas product
10.6 billion US dollars, while imported non-oil and
gas products 16.59 billion US dollars.
Indonesia intends to export
more non-oil/non-gas commodities in 2011 to cover its swelling
trade deficit with China, a trade
official said.
“The deficit can be lowered
by increasing exports, coupled
with efforts to improve the quality and added value of the products,” Vice-Trade Minister Mahendra Siregar told the media
after accompanying Trade Minister Mari Elka Peagestu in a
press briefing on export-import
performance at Trade Ministry
last week.
Siregar added that non-oil/non
gas trade imbalance with China
in the 10-month period of 2010
had surged compared to the same
period 2009 when the figure was
3.91 billion US dollars.
The soaring non-oil/gas trade
deficit with China in JanuaryOctober 2010, he said, was predominantly caused by imports of
raw materials valued at 3.1 billion
US dollars and capital goods valued at 1.7 billion US dollars.
If compared to non-oil/gas
trade deficit in the January-October 2008 period of 6.1 billion US
dollars, he said, the deficit over
the same period in 2010 is lower as export was recorded surging
more than imports.
Siregar also said that non-oil
and gas export to China during January-October 2010 period was up 56 percent compared
with the same period of 2008
when import increased only 23
percent.
Total trade between Indonesia
and China in 2010 amounted to
28.2 billion US dollars, surging
40.6 percent compared to 2009
which was registered 20.07 billion US dollars.
Non-oil and gas trade was the
largest which was valued at 26.52
billion US dollars.
In 2010, Indonesia exported
non-oil and gas product 10.6 billion US dollars, while imported
non-oil and gas products 16.59
billion US dollars.
Overall, Indonesia underwent
a trade deficit 4.9 billion US dollars, a 152-percent increase over
the deficit in 2009 which was valued at 1.9 billion US dollars, according to the Central Bureau of
Statistics (BPS).
Hatta: Climate, Oil Price Changes
Greatest Challenge in 2011
Coordinating Minister for
Economic Affairs Hatta Rajasa
said climate change and oil price
fluctuations would pose the biggest challenge for the Indonesian
economy in 2011.
“Global climate change will affect food and energy,” he said at
a new year press conference here
last week.
“The government would continue stabilizing the price of food
through market operations and
increase stocks,” he said.
He said the government would
in the near future issue two pres-
idential instructions relating to
food price stabilization efforts.
One of the presidential decrees
would give flexibility to the National Logistics Agency to procure rice and the other one to the
agriculture minister to take actions to overcome the impact of
climate change such as with regard to fertilizer and seed supply.
“Economization in fuel consumption would also be done.
So efforts will be made not only
in the supply but also in the demand side,” he said.
He said fuel subsidy would still
Bank Indonesia believes the country`s
economy will remain strong with its
gross domestic product in 2011 and
2012 growing by 6.3 percent driven by
strong domestic demand, especially
investment.
The central bank`s governor,
Darmin Nasution, said here last
week the Indonesian Balance of
Payment (NPI) in 2011 was predicted to record a relatively big
surplus although it would be lower
than in 2010.
“Exports would still grow high
but import growth would be higher in line with increasing domestic demand to make the surplus
Darmin Nasution
in the current account lower. On
the other hand, the financial and
capital current account is predicted to still record a high
surplus, driven by huge inflow of funds in the form of portfolios or direct investment,” he said.
Beware of global issues
affecting RI`s economy:
President
Floods that hit Australia the
size of Germany and France recently is a sign of climate change.
It affected agriculture, mining,
and other economic sectors in
Australia and also have a serious
impact on the global economy,
Yudhoyono said.
Other global issues that might
have an impact on the global
economy are world peace and security, global poverty, terrorism
and extremism, climate change,
and natural disasters, he said.
“We live in a dynamic world.
Therefore, we should be keen in
anticipating, gaining opportunities, and facing challenges and
obstacles,” he said.
The meeting was attended
by ministers, governors from all
Indonesia`s provinces, and also
district and municipality heads.
The Gubernatorial Working
Meeting has been held four times
since Yudhoyono took office in
2009.
The theme of this 2011 meet-
BI Governor:
RI Economy
Remains Strong
continue but it would be aimed at
the right targets.
“Limiting fuel consumption is
a must while raising a fuel price is
not an option,” he said.
Agriculture minister Suswono
meanwhile said several countries
especially Thailand and Vietnam have issued a warning that
they would reduce exports of rice
which will certainly spur international price of rice.
“However if our rice production could reach 68.8 million
tons it will not be necessary for us
to import rice,” he said.
vanced country.
The third factor related to
Indonesia`s success in handling
the impacts of world`s financial
crisis in 2008 and 2009.
The fourth factor was confidence that Indonesia could resolve problems and challenges
that it faced well, he said.
By considering the four factors,
the head of state said there were
no reasons for the government
not to remain confident in gaining a success in its development
programs this year.
“For the year 2011, we
need to be optimistic
that our development
programs will be
much more successful.
There are four factors
that enables us to
boost our country`s
development.”
The growth is driven by strong domestic demand especially household consumption and investment. The
country`s economic progress is also boosted by quite
solid external performance.
“The foreign currency reserves until the end of December 2010 were recorded at US$96.2 billion or equal to 7.1
months of imports and payments of government foreign
debts,” he said.
The President Post
A6 January 17, 2011
The Region
East Asian Economy
and Asean 2011 Objectives
By Atmono Suryo
It is becoming increasingly clear that the global
economy needs a strong Asian economy.
The world expects that Asia should move
more quickly to the epicenter of the global
economy. Asia should exist side by-side with
the Americas and Europe.
E
EAST ASIA
ast Asia with China in the lead is
widely considered
as a region on the
fast track during
the last two decades. Asia has recovered from
the economic and financial crisis
in a significant way, much faster
than other countries in the global
economy. Thanks to China, real
GDP growth in developing East
Asia is poised to increase from
7.0% in 2009 to 8.7% in 2010.
According to World Bank data,
East Asia has emerged stronger
from the global crisis. More importantly, rapid growth will be
possible in the coming years even
in a weakened global economy.
Hence, Asia is heading towards a
promising era as of 2011, particularly in the economic and business area. Such a positive developments in Asia will be of special
interest to ASEAN, especially Indonesia.
The political and security areas, however, are still in an unstable and precarious state. There
are quite a number of issues to
worry about concerning not only
the north- eastern part of Asia because of the Korean Peninsula issue but also in the southeastern
region with the problem of the
South China Sea.
In ASEAN’s view peace and
prosperity goes hand-in-hand.
Without peace and political stability there will be no prosperity. And the other way around,
without prosperity there will be
no peace. It is therefore regrettable that ARF (Asian Regional Forum) has continued to be in
a limbo. Yet all the stakeholders,
the big powers and all the countries in the region are members of
the ARF.
The area of economics and
business in Asia are in a much
more promising state. Asia is
heading towards an era filled
with both tough challenges but
also new opportunities, particularly in the area of trade, finance
and services. The big historical
thrust is that the time has come
for Asia to move from the periphery to the center of world economic gravity.
ASEAN 2011
The year 2011 will be a highly important year for Indonesia
as it will assume ASEAN’s chairmanship. The ASEAN Summit
of the ten ASEAN leaders will be
held in April 2011 while the second ASEAN Summit and East
Asia Summit (EAS), often called
ASEAN+8, is scheduled to be
held in Bali in October 2011.
These summit meetings will
give an opportunity for ASEAN, with Indonesia in the chair,
to demonstrate its continued capability to remain in the driver’s
seat in Asia’s developments.
A cabinet meeting was held
on the 17th of December to prepare for the forthcoming important meetings. The cabinet meeting was attended by the ASEAN
Secretary General.
Some important clues have
been given after the Cabinet meeting by President Susilo Bambang Yudoyono, Foreign
Minister Marty Natalegawa and
ASEAN Secretary General Surin Pitsuwanwith with regards
to some of the issues which may
come up during ASEAN 2011.
• To go global
The main theme for ASEAN
2011 would be “ASEAN Community in a Global Community”. This theme implies that
ASEAN will not only be active
in Asia but also assume a higher profile in world affairs.
• Integration
There is the need to establish
the ASEAN Community by
2015 supported by three important pillars: Political-Security, Economic and Socio Cultural.
• People-centered ASEAN
Under Indonesian chairmanship the objective would be
to bring ASEAN closer to the
people: to transform ASEAN
to become a “people-centered
Association”.
• Politics and Security
The East Asian Summit should
discuss and analyze political
and security issues in Asia. The
Summit includes powerful or
prominent countries such as
China, the United States, Russia, Japan, India, South Korea,
Australia, New Zealand and
ASEAN.
• Diplomatic Capital
Indonesia will aim to develop
Jakarta into ASEAN’s “diplomatic capital”.
It is good to see Indonesia’s
strong commitment to make
ASEAN 2011 a success. After all
it is often said that Indonesia is
losing interest in ASEAN. ASEAN and East Asia would need Indonesia’s pro-active role in Asia.
On the other hand it is in Indonesia’s interest to see a stronger
ASEAN.
It is of strategic importance for
ASEAN to establish and realize
the grand design c, namely political-security, economic and the
socio-cultural. A more integrated ASEAN would strengthen its
position in East-Asia, particularly
vis-à-vis the two giant countries
China and India.
The ASEAN+3 grouping
(ASEAN plus China, Japan and
South Korea) are the core countries for the development of the
East Asian economy. The process of economic integration in
ASEAN should pave the way
for a more integrated East Asian
community. As the Asian Development Bank (ADB) stated in
one of their main research documents, part of Asia’s success story
is also growing integration.
It is becoming increasingly clear that the global economy needs a strong Asian economy. The world expects that Asia
should move more quickly to the
epicenter of the global economy.
Asia should exist side by-side with
the Americas and Europe.
The high-income countries
are expected to grow by 2.4% in
2011 and by 2.6% in 2012, while
East Asia and Pacific will grow by
8.5% in 2011 and 8,7% in 2012,
three times faster than the highincome countries. East Asia is
thus catching up with the West.
The rapid growth of Asia is not
only an economic necessity for
the growth of the global economy. It also reflects the historical
call to Asia to implement the shift
of global power from the West to
the East. “Asia is returning to the
center stage it occupied for eighteen centuries before the rise of
the West”, Kishore Mahbubani stated in his book “The New
Asian Hemisphere”.
Therefore, it It makes sense if
Indonesia would like to see ASEAN together with the countries of
Asia to go global. ASEAN Community in a Global Community
is the proposed theme for ASEAN 2011. ASEAN with a strong
Asia alongside would be able to
play its positive part in the global
community of nations.
Internally, within ASEAN,
there is the need for people’s involvement in the growth of the
South-Eastern part of Asia. People often cynically ask, “what is
the meaning of ASEAN for us”.
There are still many frictions and
rivalries among the countries in
the region. This should come to
The rapid growth
of Asia is not
only an economic
necessity for the
growth of the
global economy.
It also reflects the
historical call to
Asia to implement
the shift of global
power from the
West to the East.
an end.
ASEAN, as an integral part of
Asia, should become a pro-people-centered ASEAN that would
bring peace and security, prosperity and welfare to the people, providing them with greater employment opportunities.
It is of strategic importance for
East Asia and the Pacific to have
a strong and solid ASEAN in
their midst, with Jakarta as ASEAN’s diplomatic capital, as proposed by Indonesia.
The writer is a retired career diplomat
and former ambassador to the EU.
The President Post
January 17, 2011 A7
ASEAN
ASEAN: To Develop
a New Economic Momentum
By Atmono Suryo
Photo: www.kompas.com
ASEAN, as a regional economic entity, is becoming a significant economic
force in East Asia beside China, Japan and India. It has become the 5th
largest economy in the world. In terms of numbers ASEAN, with its total
population of 584 million people, $1,5 trillion GDP, ample human and natural
resources and with a record of significant growth, ASEAN has the potential
to become another economic force.
A
ASEAN ECONOMY
s the East Asian
economy is moving
ahead quite strongly
with China and India in the lead, there
is the need for ASEAN to develop a new economic
momentum to surge ahead in the
regional and global economy. In
order to revitalize ASEAN there
is the need to develop new paradigm in some key areas.
Firstly, to strengthen and integrate ASEAN’s economy to become another “powerhouse” in
East Asia, and secondly to alleviate its position and role in the
global economy not only in East
Asia but also in the wider global economy. Such an objective
is in line with the ASEAN 2011
theme “ASEAN Community in
the Global Community”.
With Indonesia in the chair,
ASEAN intends to boost its external political-economic relations not only with the countries in the ASEAN+3 grouping
(ASEAN plus China, Japan and
South Korea), but also with the
countries belonging to the EAS
(East Asia Summit) which now
includes India, Australia, New
Zealand , Russia and the United States.
To put it in more popular
terms, ASEAN will not only
“go regional”; it also intends “to
go global”. Such strategy would
be for the interest of the ASEAN economy and ASEAN’s image and standing in the world. It
will also support the expanding
East Asian economy with China
and India in the lead and in the
broader context to serve the interest of the global economy.
ASEAN, as a regional economic entity, is becoming a significant economic force in East
Asia beside China, Japan and India. It has become the 5th largest
economy in the world. In terms
of numbers ASEAN, with its total population of 584 million
people, $1,5 trillion GDP, ample human and natural resources and with a record of significant
growth, ASEAN has the potential to become another economic force.
As can be seen from the below statistics (Figure 1) within
ASEAN Indonesia has the largest
GDP, the largest population and
the largest land area. Its Per Capita GDP, however, is lower than
that of Singapore, Brunei Darussalam, Malaysia and Thailand. It
is expected that Indonesia should
continue to play a leading and
positive role in ASEAN.
Not only in terms of population and economic size, much of
ASEAN’s credibility and attraction to the outside world is being built on a number of developments, which include among
others the following factors:
• It is ASEAN’s continued objective to achieve peace, security
and stability in the South East
and East Asian region. This
is an important objective for
the development of the greater
Asia-Pacific region.
• ASEAN continues to promote
cohesion among the South
Eastern countries notwithstanding the fact that ASEAN
faces diversity and divisions in
the region in the area of politics
as well as economics.
• ASEAN is part of the Developing East Asian region which
has come out stronger with
output expanding at near precrisis rates and private investment on the rise.
• ASEAN is in the midst of
building up the grand-design
ASEAN Community 2015
supported by three pillars. An
integrated ASEAN would be
an attractive region for world
investors and traders.
There is the urgent need for Indonesia to work harder on various matters. Not only in the area
of the free flow of goods and services, but also in the flow of capital and investment and in particular in the area of the free flow of
skilled labor.
Indonesia is still lagging behind other emerging countries
in the area of competitiveness.
Indonesia’s world scoring is still
very low. In fact, among ASEAN
countries Indonesia is considered
to be on the low side. It will not
be easy for Indonesia to change
this unhappy situation.
Accordingly, there is a great
deal of uneasiness in the Indonesian community, including in the
business community. It is feared
that Indonesia will not achieve
the goal of ASEAN Economic Community by 2015. But Indonesia as an important leading
country in the Association cannot afford to lag behind.
SINGLE PRODUCTION BASE
ASEAN is moving to create a
single market and also a single
production base. A positive trend
to mention is the performance of
ASEAN’s total trade which grew
by 6.2% despite the global financial crisis in 2008
It appears that ASEAN is most
successful in the area of electronics (Figure 2). The output and
trade in electronics is by far bigger than the other priority areas.
Next in line comes textiles and
apparels, the automotive industry
and agro-based sector. Rubberbased, wood-based sectors and
the area of fisheries, which are of
particular importance to Indonesia, are still at the lower end.
ASEAN ECONOMIC
COMMUNITY
According to the AEC score
card, for the period 2008/2009
ASEAN has achieved the rate of
80.9%. On paper there is the possibility that the 100% rate can be
achieved on time, but there is still
some doubts on this matter.
Judging from the observations
made at a recent ICWA seminar
held at the Financial Club, one
gets the impression that the progress made in Indonesia to prepare for the implementation of
the ASEAN Economic Community is not too impressive. There
is even a great deal of pessimism
in the air.
An area that is most likely not
known is skilled labor, which
covers the following groups: architects, engineers, accountants, surveyors, medical practioners, including dentists and
nurses. The ASEAN Economic
Community will provide for the
free flow of skilled labor in areas which are covered by Mutual
Recognition Agreements.
After 43 years of existence the
time has come for ASEAN to develop a new momentum:
Single Production Base
Value in million US$
2000
2001
2002
2003
2004
2005
2006
2007
2008
375,000
300,000
225,000
150,000
75,000
0
Agro-based
Automotive
Electronics
Fisheries
Rubber-based
Textiles & Apparels
Wood-based
Source: ASEAN Trade Database
ASEAN Population, Territory, and Economy (2008)
Country
Brunei Darussalam
Cambodia
Indonesia
Total land area
(sq. km)
Total population
(thousand)
GDP at current market
prices
(US$ Mn)
(in US Million
PPP$)
GDP per capita
(US$)
(PPP$)
5,765
397
14,147
19,133
35,623
48,180
181,035
14,656
11,082
27,986
756
1,909
3,943
1,860,360
228,523
511,174
901,139
2,237
Lao PDR
236,800
5,763
5,289
13,868
918
2,406
Malaysia
330,252
27,863
222,057
383,059
7,970
13,748
Myanmar
676,577
58,510
27,182
68,203
465
1,166
Philippines
300,000
90,457
166,773
317,215
1,844
3,507
Singapore
710
4,839
182,103
238,765
37,629
49,338
513,120
66,482
273,729
546,320
4,117
8,218
Thailand
Vietnam
331,212
86,160
90,701
242,697
1,053
2,817
ASEAN
4,435,830
583,651
1,504,236
2,758,385
2,577
4,726
CLMV
1,425,624
165,089
134,253
352,753
813
2,137
ASEAN6
3,010,207
418,562
1,369,983
2,405,632
3,273
5,747
The output and trade in electronics is by far bigger than the other priority areas. Next in line comes textiles and apparels, the automotive industry and
agro-based sector.
• To bring ASEAN closer to the
people, it must be transformed
from a bureaucratic association
to become a more “people-centered “ association to get the
full support of the people.
• The entire ASEAN community must be informed and
support ASEAN’s objectives,
including the question of ASE-
AN Community. The people
in the region must know of the
objectives and advantages of
closer economic integration.
• ASEAN, together with the
other emerging countries, deserve to be in the forefront to
reshape and revitalize the global economy through the G20,
WTO, UN agencies and other
international forums.
• ASEAN has gone very far in
developing various visions and
schemes, a multitude of roadmaps and other directives. The
time has now come for on the
ground actions and implementation.
Throughout 2011 Indonesia
will have a golden opportunity to
show the world of its firm leadership to revitalize ASEAN, and
that ASEAN is apt and ready to
play a positive and effective role
in the regional and global economy.
The writer is a retired career diplomat
and former ambassador to the EU.
The President Post
A8 January 17, 2011
Education
GLOBAL EDUCATION:
Key to Global Competency in a Global Society
By Jhanghiz Syahrivar
Education does not only encourage personal
development, it also offers general growth of an
entire community by providing a place for people
to interact, socialize and to unify their societies.
E
ducation is one of
the most frequently discussed issues
in the world. Shaik
Baksh, the Minister of Education
of Guyana, argues that education is the backbone of all sectors
of the economy and the delivery
of quality education to a nation’s
children remains a top priority.
So, how do we define education? Perhaps some people believe
that true education can only be
attained in a formal educational institution. Others believe that
education comes in many different forms and environments. A
definitive answer to that question
might not exist at all. Now, try
to leap ahead by thinking the real
purpose of education towards our
nation.
Many people believe that the
real purpose of education towards a nation is to educate
youths to be responsible citizens.
Some, like Shaik Baksh, believe
that it is to develop individuals, as
well as society, in order to ensure
a society’s economic success. Few
others simply argue that the real
purpose of education has nothing to do with the nation and is
simply focused on developing individual talents and intelligence.
Even though their answers may
differ, they certainly agree that
education is a basic human right.
When that right is granted, the
growth and development of the
society as a whole is more likely
to prosper.
In 1990, UNESCO launched
EFA, the movement to provide
quality education for all children,
youth and adults by the year
2015. This quality education may
refer to the establishment of formal and non-formal educational
institutions that adhere to global needs and requirements, such
as English speaking competency,
global perspectives, technology
literacy, and many others.
In an attempt to bridge some
of the gaps that prevent Indonesian youths to compete with
those from developed nations,
President University was established in 2001. The University’s big goal is to be a world class
learning institution that produces leaders in their respective fields
and communities by educating
future generations through the
transfer of skills and knowledge
in order to build character and
wisdom.
The goal is supported by several strategies that aim to reduce
some of the well-known gaps that
prevent people from becoming a
global community, namely communication, human competency,
cultural difference, and technology literacy; First, President University knows the significance of
communication in today’s globalization era—failure in communication may lead to dramatic
multidimensional issues, such as
the class of cultures and religions.
Therefore, the University implements English, the language
of the world, as the daily medium inside and outside campus.
Hopefully, local students will be
able to interact with and understand their foreign counterparts.
Second, President Universi-
ty provides a two-semester internship program that enables
students to work in more than
its 1,500 global affiliates and to
grasp so-called ‘real-life working experiences’ so that they can
compete globally. Thanks to the
program, it is hard to find its students unemployed more than six
months after they graduate.
Third, President University
comingles local and overseas students in one classroom to develop
knowledge and understanding of
other cultures and/or religions.
Every year, the University also
conducts a Cultural Night as an
introduction to a nation’s literature, music, folklore, visual arts,
and popular culture. The event
could be used as a comparative
approach to help students understand similarities among cultures
as well as the distinctive qualities of societies. In the university, global and international studies are integrated and folded with
some courses, such as cultural diversity.
Lastly, President University
provides greater access to technology to its students and narrows the ever-widening digital divide by granting internet access
in every corner of the campus. In
many ways, the most basic access
to technology can serve as a valuable educational tool. Individuals who are denied this access are
at a disadvantage when trying to
grasp opportunities to make life
better for themselves, their families, and their communities.
All in all, global education
is important because the dayto-day lives of average citizens
around the world are influenced
by burgeoning international connections. The goods we buy, the
work we do, the cross-cultural
links we have in our own communities and outside of them,
and increased worldwide com-
munication capabilities all contribute to the imperative that responsible citizens understand
global and international issues.
Education itself, in its essence,
is the foundation for the success
of any given society. Numerous
studies have shown that there is
a correlation between education
and lower birth rates, lower infant mortality rates and fewer
maternal deaths. A more educated population will also result in
higher personal incomes as they
all have more access to financial
opportunities. Education does
not only encourage personal development, it also offers general growth of an entire community by providing a place for people
to interact, socialize and to unify
their societies.
Jhanghiz Syahrivar is a Senior
Education Consultant and an
Assistant to Lecturer of Faculty of
Economics, President University
Disparity in Education Sector
Needs Comprehensive Treatment
By Widya Sanjaya
T
o unravel the problem of education in
Indonesia, we need
to first identify categories of problems
facing this nation
that is the category of policy, implementation, capacity, facilities,
absorptive, and competition.
Simplistically it can be seen
that education policy has only
produced graduates who form a
pyramid—on top there are very
few graduates but way down to
the bottom there are so many.
According to Deputy Minister of Education Prof. Dr. dr.
Fasli Jalal, there are currently 52
million students from all levels
throughout Indonesia, covering
about 4.5 million in college and
university level, 22.5 million at
the high school, and the rest at
the level of primary school and
kindergarten.
Meanwhile, not more than
350,000 students graduate each
year from universities. These figures prove that it is not easy for
Indonesian students to pursue
higher education.
The biggest obstacle is financial difficulty due to low family income levels while the cost of
education at universities cannot
be lower because of the need to
improve quality amid an increasingly tight competition.
On the other hand, the pressure from new registrants entering kindergarten, elementary,
and secondary school continues
to grow every year.
The consequence that cannot
be overcome is low level of graduates’ employability both in quantity and quality. In terms of quantity, many graduates cannot “sell”
their expertise to industry so it is
difficult to get a good job.
In terms of quality, many employers have laid off their workers
as there is increasing demand for
world-class human resources and
not the ones they have.
million teachers in Indonesia,
more than 1.3 million still do
not have a minimum educational qualification of S1 or D4. Up
to 71 percent of teachers are not
yet certified.
Policy implementation is another problem. No matter how
good the policy, it will not produce maximum results when implemented by human resources
that are not capable.
Nevertheless, there is now some
home because the government of
President Susilo Bambang Yudhoyono has begun to implement a teachers certification program for improving the quality of
teachers at various levels.
Education Minister Prof. Dr.
Mohammad Nuh said the government needs to certify 50,000
teachers every year to fill the gaping need for qualified teaching
personnel.
The minister said, out of 2.6
The next issue to be tackled is
capacity or capability of Indonesian families to educate their children. This is closely related to per
capita income level that has not
been uniformly strong.
As a result, it is not easy for
children from poor families to
continue their education to college, without scholarship support
from the government and the private sector.
The government needs to encourage more national companies (especially SOEs) and foreign corporations to provide
scholarships through their corporate social responsibility (CSR)
programs.
The President Post
The number and types of
scholarships from local governments in 33 provinces also must
be multiplied in order to fill the
scarcity of skilled human resources at the provincial and district levels.
Locally-owned
companies
need to be encouraged to provide scholarships to strengthen
the capacity of human resources
and provide opportunity for local workers to build their respective regions.
Another factor that causes disparity in education is the issue of
educational facilities that have
not been spread evenly throughout the country.
In big cities, many schools have
modern facilities to support the
teaching-learning process, but in
isolated areas, it is the opposite.
In urban areas many high
school and college campuses are
connected to the Internet so they
are very rich in data and information. School and university
students never lacked data and
information; instead, they can accumulate more than they need.
But in others areas, adequate
library resources remain a problem. Such a situation has a direct
impact on the outcome of education.
In general, university curriculum has never been properly synergized with the needs of
businesses that create jobs. Consequently, many university graduates have difficulty getting in.
On the other hand, industries
do not “talk” with universities so
they do not understand what is
being taught in universities.
A number of private universities in Indonesia have began using faculty members from developed countries like the United
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States, Canada, European countries, Australia, and some prominent countries in Asia, including
India, Japan and the Philippines.
Their presence also provides
a new culture in the academic
world in Indonesia. They have
also brought along a variety of
best practices to be implemented
in Indonesia.
However, in line with that, the
cost of education that must be
borne Indonesian students will
increase because foreign expatriates’ presence is costly.
All these factors influence the
progress of education in Indonesia. What is needed now is concerted efforts to create competitive advantages for the country
that is growing fast in all sectors. Due to that the government
needs to apply a comprehensive
strategy to elevate Indonesia’s human resource potential to a higher level.
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BUSINESS BRIEFS
Production level of PT Pusri
over two million tons
PT Pusri in Palembang has reached a production of 2,050,000 tons, said President Director of
PT Pusri Ir Arifin Tasrif in Palembang, South Sumatra, last month.
He said the fertilizer production has faced
many disruptions as stocks had been accumulating forcing the factory to lower its production
capacity.
The storage facilities are already full, and transportation by Musi river has become inefficient,
while the use of fertilizers was below the target
set by the agriculture ministry, he said.
In the meantime, the long and incessant rains in addition to the switch
of the planting season had a serious effect on the use of fertilizers.
Chandra Asri to build
butadiene plant
PT Petrokimia Butadiene Indonesia (PBI), a subsidiary of petrochemical
producer PT Chandra Asri, will soon build a butadiene plant, the first of
its kind in Indonesia.
“We have set aside $100 million to build a (butadiene) plant with a capacity of 100 thousand tons per year,” PT Petrokimia Butadiene Indonesia
Director Suhat Miyarso said last month.
The plant will be built on 40,000 square meters of land in the PT Chandra Asri factory compound in Cilegon, Banten province, he said.
“We are currently preparing a bidding process to decide an EPC contractor,” he said.
He said PT Petrokimia Butadiene Indonesia has extended an invitation
to a number of companies in South Korea, Japan and Italy, to file a bid for
the project until March 2011.
Photo: www.tradenote.net
Butadiene
B
The President Post
Photo: www.ibtimes.com
State Enterprises Minister Mustafa Abubakar
considered the control of 26 percent of the stock
market`s capital by the state-owned companies
as very good in view of the fact that the number of
state-owned companies in the market comprised
only four percent of the total number of companies
listed at the BEI (421).
S
eventeen stateowned companies listed at the
Jakarta Stock
Exchange (BEI)
control 26 percent of the market`s total capital, State Enterprises
Minister Mustafa Abubakar
said.
“Until December 29,
2010, the total value of market capital reached Rp3100
trillion and Rp819 trillion
of it or 26 percent are controlled by state-owned companies,” he said at a year-end
press conference at his office
here on Friday.
He said communication
operator Telkom held the
biggest share in the stock
market`s capital at Rp161.2
billion, followed by Bank
Mandiri (Rp137.1 billion), Bank Rakyat Indonesia (Rp129.4 billion), Perusahaan Gas Negara (Rp106
billion), Bank BNI (Rp71
billion), Semen Gresik
(Rp56.6 billion) and Bukit
Asam coal mining company
(Rp52 billion).
Most of the 17 state-owned
companies recorded positive
share movements in the past year
with construction company Adhi
Karya recording a price growth
of 122 percent, Wijaya Karya
(112.3 percent) and Bank BNI
(103.1 percent).
Only two state-owned companies recorded negative share price
growth in the past year, namely
telecommunication company PT
Telkom at 15.3 percent and pharmaceutical company Indo Farma
minus 3.6 percent.
Mustafa said the price of
Telkom shares dropped because
the company was also listed in
New York and therefore the price
of the company`s shares was also
affected by the crisis that hit capital markets in Europe and the
US.
Mustafa considered the control of 26 percent of the stock
market`s capital by the stateowned companies as very good in
view of the fact that the number
of state-owned companies in the
market comprised only four percent of the total number of companies listed at the BEI (421).
Communication operator Telkom held the biggest share in the stock market’s capital at Rp161.2 billion.
In addition, he said, seven of
the state-owned companies were
among the 20 listed companies
with the greatest amounts of capital.
Nine state firms suffer losses
this year
Nine state-owned companies
suffered a total loss of Rp483 billion this year, Abubakar further
said.
“The figure fell from 22 the
year before,” he said.
The nine state firms are plan-
tation company PT Perkebunan
Nusantara XIV, paper producer
PT Kertas Kraft Aceh, shipbuilder PT PAL Indonesia, aircraft
maker PT Dirgantara Indonesia, textile producer PT Industri
Sandang Nusantara, insurance
firm PT Asuransi Kredit Indonesia, shipping company PT Pelni,
state publisher PT Balai Pustaka, and paper producer PT Kertas Leces, he said.
“In 2011 we aim to reduce
the number of state firms suffering losses to 4-5. In 2012 all state
firms are expected to make profit,” he said.
The State Enterprises Ministry was committed to restructuring state firms suffering losses by
involving state asset management
company PT Perusahaan Pengelola Aset (PPA) and the stateowned companies concerned, he
said.
“So far, we have managed to
rescue a number of state firms including Merpati and Semen Kupang. Both of them have now
made a profit,” he said.
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The President Post
B2 January 17, 2011
Business
Conoco Phillips prepares
To drill in Aru Islands
Fuel Restriction
BPH Migas deploys a
special team to control
the implementation of the
restriction policy on fuel and
gas subsidies consumption
as of April 2011.
REI: Property Sector
to Grow 15 percent in 2011
REI estimated that
up to December
2010 realization of
welfare houses by
its members across
the country reached
120,000 units with
most consumers using
housing credits from
BTN Bank.
Real Estate Indonesia (REI)
is optimistic the property sector
will grow by up to 15 percent in
2011 compared to 10-12 percent
this year.
“The key to the property sector`s growth for middleand low-cost houses is in regulations and next year the problem
is expected to be finished while
the macro-economic condition
would also be good. So we are
optimistic the sector will grow
that high,” REI`s general chairman Setyo Maharso, told newsmen here last month.
He said the development of
middle- and high-cost houses
meanwhile would fully depend
upon market mechanism and the
condition of the country`s macroeconomy.
Referring to several macroeconomic indicators such as the
stable rupiah exchange rate at
around Rp9,100 per US dollar
and controlled rate of the SBI despite high inflation Setyo said he
was optimistic the predictions
would be met.
“The 4.5 percent growth in
2009 was already enough to
bring stability on the property
market. Now in 2010 the economy is projected to grow up to 5.90
percent. This is even better. The
World Bank meanwhile predicts
Indonesia`s economy will grow
6.2 percent in 2011,” he said.
He said the banks that distribute house credits (KPR) have also
varied and provided affordable
interest rates for consumers.
For the middle and low class
the government meanwhile has
provided a Housing Financial Liquidity Facility.
“So if the regulations are al-
ready in place what should we
wait. This is certainly positive,”
he said.
REI estimated that up to December 2010 realization of welfare houses by its members across
the country reached 120,000
units with most consumers using housing credits from BTN
Bank.
Realization of houses built using subsidized and non-subsidized credits from BTN until
September 2010 reached 107,673
units with payments reaching
Rp7.4 trillion.
Pertamina Needs New Technology
to Meet Production Target
After exceeding this
year’s production
target, PT Pertamina
EP was ready to
increase oil production
from 130,200 barrels
per day in 2010 to
132,000 barrrels per
day next year.
To boost its production in
2011, PT Pertamina EP, a subsidiary of state oil and gas firm
PT Pertamina, needs not only to
find new reserves but also a new
exploration concept and technology, an analyst said.
“In theory, there are two conditions Pertamina EP must meet
to achieve its production target
for 2011, namely new potential
gas and oil blocks or basins and
breakthrough in oil and gas exploration technology,” Dr Iskanda Zulkarnaen, a geotechnology
analyst at the Indonesian Insti-
tute of Sciences (LIPI), said here
last week.
He said the conventional exploration technology used so far
could not optimally explore oil
and gas basins in Indonesia.
“There are 60 basins in Indonesia but only few of them hold
viable oil and gas reserves. But
with new technology it will be
possible to find reserves not only
in basins but also in existing subbasins,” Iskandar said.
Therefore, a new exploration
concept was essential for Pertamina EP to find hidden oil and gas
potentials in the basins, he said.
However, new technology
might not be cheap and is kept
by certain parties to gain more
profit from the oil and gas sector,
he said.
Previously, after exceeding this
year’s production target, PT Pertamina EP was ready to increase
oil production from 130,200 barrels per day in 2010 to 132,000
barrrels per day next year.
Its president director, Salis
Aprilian, said that crude and condensate production in 2011 was
expected to reach 132,000 bar-
rels per day or a rise by 1.4 percent from 130,000 barrels per
day in 2010.
“However because of a natural
decline of 18 percent, production
actually increased by 20 percent,”
he said.
The quite steep drop happened
because most of the oil wells were
old and some of them had even
produced 30 percent less, he
said.
Moreover, Salis said, gas production in 2011 was expected to
reach 1,095 million cubic feet per
day (MMSCFD) up from 1,054
MMSCFD in 2010.
PT. Conoco Phillips is preparing to do exploratory drilling
in the offshore Amborit block 6 in Aru Islands district, a local
energy official said.
The foreign oil company had already installed its drilling
equipment with its exploration activity scheduled to start at the
end of December 2010, Bram Tomasoa, the head of Maluku`s
energy and mineral resources office, said.
He said his office, a PT.Conoco Phillips team and the Oil
and the Gas Regulatory Agency (BP-Migas) had conducted
a familiarization meeting on the development of the Amborit
block 6 for the local community in Dobo, Aru Islands district`s
capital, last December 10, 2010.
“The familiarization effort was made in cooperation with
Maluku`s legislative council and the Aru Islands`s district regional task force as well as local community leaders and people at the drilling location in South Aru Tengah sub-district in
order to build an understanding for investment activities which
require large budget,” he said.
Bram said the funds for the exploration drilling was to be
provided by PT.Conoco Phillips in compliance with the provisions and conditions stipulated by the central, provincial and
district administrations.
“I was told the Aru Islands district administration had received more than Rp32 billion for various arrangements ahead
of the exploration drilling under an Energy and Mineral Resources Ministry license,” he said.
Bram said the funding also came from the contribution of
PT Conono Phillips which had obtained a permit from the Energy and Mineral Resources Ministry for exploration drilling in
the Arafura Sea block in North Aru Selatan sub district which
was scheduled to begin in January 2011.
“So if the exploration drilling turns out to have economic
value, the Aru Islands district administration will receive a great
share of the oil and gas produced,” he said.
Local firms to take over
Siak block from Chevron
A number of regional government-owned companies
(BUMDs) in Riau province
plan to take over the management of Siak oil block
from PT Chevron Pacific Indonesia whose contract will
expire in 2013.
“There have been several
BUMDs expressing interest
in managing the Siak Block
after Chevron`s contract expires in 2013,” spokesman
for the Upstream Oil and Gas Executive Agency (BP MIgas)
Elan Biantoro said last month.
Chevron, formerly Caltex, signed a 22-year production sharing contract for the operation of the oil block in 1991.
The company earlier operated the block under a contract of
work signed in September 1963. The block currently produces
2,000 barrels per day.
He said BUMDs had a wide chance to manage the block
the more so because the central government had been committed to giving priority to BUMDs.
To date, there are two BUMDs in Riau managing oil blocks
taken over from Chevron. They are PT Bumi Siak Pusako-Pertamina Hulu which manages Coastal Plain Block in Pekanbaru
and PT Sarana Pembangunan Riau which manages Langgak
Block.
He said the BUMDs had a wide chance to take over the oil
block since Chevron had not applied for the extension of the
contract until mid 2010. However, the company still could apply for the extension of the contract until 2011 at the latest.
The President Post
January 17, 2011 B3
Investment
INVESTMENT BRIEFS
Australian investor to build
50 villas in Lombok
An Australian company plans to build 50 villas of international standard
in South Lombok marine tourism resort in West Nusa Tenggara province,
a local official said.
“The Australian company will build villas in Seger Kuta beach and
Benang Kelambu natural tourist resort in North Batukliang subdistrict,”
Central Lombok District Head H.M.Suhaili FT said last month.
The construction of the villas will employ Singaporean architects who
are accustomed to designing building structures in the United States and
China, he said.
Rising
Property
Turnover
Minister sees capital inflow
for direct investment rising
Hatta Rajasa
Chief economic minister Hatta
Rajasa said he believed foreign
capital inflow for direct investment would rise this year.
“In 2011 it will increase by
more than US$12 billion,” he said
here last week.
He said in 2010 the capital
inflow for direct investments
reached US$12 billion and for
portfolios US$16 billion.
On the government`s plan to limit consumption of subsidized fuels, the
minister said limiting fuel oil consumption was not the same as raising its
price.
“A fuel price hike only affects fiscal matters. If it is done it will impact all
people, including the poor,” he said.
Hatta said the government would approach the issue in fiscal as well as
sense of justice terms so that the policy to be adopted would only affect
selected segments of the people.
“If only a fiscal approach is used it will be enough to just raise the price.
The law however states that the government should continue to subsidize the economically weak segments of the population,” he said.
SE Sulawesi province, private
sector to build nickel plant
Nur Alam
The Southeast Sulawesi provincial administration established
cooperation with foreign and national companies to build a nickel
processing plant in the region.
“The cooperation is contained
in a memorandum of understanding between Jilin Horoc
Nonferrous Metal Group Ltd of
China and PT Billy Indonesia on
December 15, 2010,” Southeast
Sulawesi Governor Nur Alam
said here last month.
Nur said under the MoU, Jilin will keep $100 million at Bank Pembangunan, Southeast Sulawesi office, before building a stainless steel plant.
Ministry of Public Housing
estimates the turnover of
property in 2011 will rise
by about 12% to Rp 100,8
trillion, up from 2010’s
projeced figure of Rp 90
trillion.
Investments in Mining
in 2010 Reach US$2.2 b
I
nvestments
in
the mineral and
coal mining sector in 2010 reached
US$2.282 billion,
according to the
ministry of energy and mineral resources.
The ministry`s director
general of minerals and coal,
Bambang Setiawan, said
here last month the realization was above the target set
at US$2.119 billion.
“General mining performed well,” he said.
He said the realization of minerals and coal investments until
November 2010 was US$1.865
billion.
It came from working contract
investments totaling US$1.07
billion, coal mining working
agreement-based
investments
(PKP2B) US$0.756 billion, mining authorities including stateowned companies such as PT Timah Tbk, PT Antan Tbk, and
PT Bukit Asam Tbk, US$0.038
billion.
Until the end of December 2010, investments rose to
US$2.282 billion. It consists of
investments from working contracts US$1.479 billion, PKP2B
US$0.764 billion and from stateowned companies US$0.038 billion.
Investments in mining service business reached US$904.82
million in 2010, making total
investments in the sector to be
US$3.186 billion.
Bambang said the total investments did not as yet include
those for mining activities whose
licenses are produced by regional
governments in various regions.
Three Investors to Build
Hotels in Denpasar
RI Hopes Singapore’s
Investment to Rise 50%
Indonesia hopes Singapore’s
investment in Indonesia will
rise by up to 50 percent in
2011, chief economic minister Hatta Rajasa said here last
week.
“Singapore’s
investment
in Indonesia in 2010 was recorded at around five billion
US dollars. We hope it will
increase up to 50 percent,”
he said after meeting with
Singapore`s minister of trade
and industry Lim Hng Kiang.
He said investment was one
of the issues discussed by the
working group in the framework of economic cooperation
between the two countries.
The two countries have
agreed to focus their cooperation on the fields of infrastructure, connectivity, ports and
manufacturing sectors.
“Singapore as an international financial hub is expected to promote investment opportunities in Indonesia,” he
said.
The working group that has
been set up by the two countries
also deals with development in
Batam, Bintan and Karimun, air
transportation, human resources
development and agribusiness.
Hatta said the development in
Batam, Bintan and Karimun has
shown progress while obstacles
in licensing, customs and others
had been reduced.
“We have agreed to increase
the promotion of the region so
that it could become an investment destination. This must become a success story,” he said.
On air transportation, Hatta
said the Association of Southeast
Asian Nations (Asean) would issue a connectivity blueprint in
the framework of establishing an
ASEAN economic community.
He said an agreement has also
been reached with regard to improving the skills of the Indonesian human resources in Singapore.
“In the agribusiness Singapore
meanwhile will keep increasing
supply of vegetables from Indonesia. It is expected to grow 20
percent,” he said.
Photo: www.foggodyssey.com
HK allocates $50 m
for investment in RI
The Hong Kong government
has allocated US$50 million for
its investment in Indonesia until
next year, an Indonesian diplomat said here.
“Indonesia must be able to
provide various facilities so that
the investment funds will not
go to other countries instead,”
Teguh Wardoyo, Indonesian conTeguh Wardoyo
sul general in Hong Kong, told
Antara last month.
He said that up to now about $34 million had been absorbed with the
remaining $16 million put on hold.
Two of the hotels
will be built on
the Sanur beach
and the other
in the heart of
Denpasar city.
Three investors are planning to build hotels in Denpasar, Bali, which are expected to overcome a shortage
of 1,600 hotel rooms in the
past two years, a tourism official said.
“There are three investors
applying for permits to build new
hotels,” Head of the Denpasar
City Tourism Office Putu Budiasa said last month.
One of the investors comes
from Poland, he said without
elaborating on the total investment of the three hotels.
He said the local authorities are
still processing the applications
from the three investors.
If they meet requirements the
tourism office would soon issue
in-principle approval to them so
they could begin the construction of the hotels in 2011, he
said.
“But we still have to consider
their financial capacity first. Let`s
wait and see the further developments,” he said.
Two of the hotels will be built
on the Sanur beach and the other
in the heart of Denpasar city.
“Hopefully, the presence of the
three new hotels will overcome a
shortage of 800 hotel rooms in
Denpasar,” he said.
The city administration had
set itself the target of raising the
number of hotel rooms by 1,800
in 2010 and 2011.
He said 1,000 of the targeted
1,800 hotel rooms had been built
this year.
Singapore`s investment in Indonesia in 2010 was recorded at around
five billion US dollars.
The President Post
B4 January 17, 2011
Markets
FISCAL POLICY
Time to Reduce Interest Payment Costs
By Helmi Arman
The prudent fiscal
policies in which the
government has held
dear for so long are
finally bearing fruit. The
opportunity has risen
to put things further to
our advantage. Now is
the time to take it.
I
n the midst of rapid capital inflows and improving perceptions on the
economy lies an opportunity to enhance the
country’s strategy on fiscal financing.
Capital inflows are likely to
remain a very warm issue for
next year. Given the unsustainable debt levels in the developed
world, as well as the uncertain
growth outlook thereat, emerging markets will continue to be
a haven for cross-border investment and yield seeking.
In 2010, Indonesia saw breathtaking amounts of capital inflows. During the first three
quarters of the year, for example,
foreign direct investment and financial market capital inflows
reached a record high US$23 billion (or around 3 percent of the
size of the economy).
Accordingly, the portion of local currency bonds owned by foreign investors continues to rise
and, at around 30 percent, is currently the highest in the region.
Given Indonesia’s shallow financial markets, there is obviously a scarcity of available local
currency financial instruments,
especially when it comes to the
huge influx of foreign funds.
Of course, on one hand this
condition leaves us prone to high
levels of volatility, not to mention
asset price bubbles. But on the
brighter side, the scarcity of instruments also gives the government (as a key supplier of bonds)
an upper-hand in the markets.
Bond yields are at historical lows and selling debt has become a much easier task. The
government now has more freedom when it comes to issuing papers for financing the fiscal deficit. This change in landscape is
actually giving room for us to revisit the traditional paradigms in
managing budget finances.
Honestly, although debt management has seen many improvements in the way it is run, things
haven’t been exactly perfect.
At the end of every fiscal year, a
good portion of the funds raised
from bond financing ends up unused.
At the end of 2008, for example, funds raised in excess of what
was needed reached a staggering
Rp 80 trillion. This was repeated in 2009 with Rp 40 trillion,
and probably another significant
amount this year.
Over-financing is very inefficient and wasteful, as taxpayers
must pay a fortune to cover interest payments on an idle loan.
For example, the average yield
on bonds issued in 2008 was
around 11 percent per annum.
We can easily calculate that from
a principle of Rp 80 trillion, the
redundant interest payments can
potentially reach trillions annu-
ally, equaling the annual cost of
putting hundreds of thousands of
impoverished children through
school.
This tendency to over-finance
stems from many structural reasons; one is a chronic tendency to
underachieve the spending target
on infrastructure. To fix this requires addressing many structural problems, such as land acquisition, which could take some
time.
It’s high time for
this to change.
The government
should, first,
reconsider
its strategy of
frontloading and
second, start using
more short tenor
bills (that mature
within the fiscal
year) to minimize
interest payments.
However, what we can realistically aim for 2011, in regard to
reducing the likeliness and cost
of over-financing, is to add more
flexibility to the financing side.
We can see the extent of overfinancing all this time has been
made worse by the government’s
debt management strategies to
mitigate the so-called refinancing risk; i.e. the possibility of being unable to borrow and repay
existing debt.
The refinancing risk was indeed a big issue five or 10 years
ago in the years of recovery from
the 1998 financial crisis. In order
to reduce this refinancing risk,
the government’s rule of thumb
on debt management has been to
issue bonds with a maturity of as
long as possible, as soon as possible.
Under the so-called strategy of
“frontloading”, huge amounts of
debt are sold in the early months
of every year. Longer tenor bond
issuances have also become a high
priority over shorter tenor bonds.
The average maturity of the
government’s bond portfolio has
been maintained at around eight
years, which looks high even at
regional standards.
According to data from the
Asian Development Bank, peer
countries such as China, South
Korea, Malaysia, the Philippines
and Thailand all have more outstanding short-tenor debt (one to
three years) than they do longtenor debt (more than 10 years).
Only in Indonesia does the reverse apply.
Of course, this doesn’t mean we
must follow everything the others do. But considering Indonesia’s chronic and wasteful excess
financing problem, continuously
prioritizing the sale of long-term
bonds increasingly looks like a
costly strategy.
It’s high time for this to change.
The government should, first, reconsider its strategy of frontloading and second, start using more
short tenor bills (that mature
within the fiscal year) to minimize interest payments.
A lot has changed since 2005.
The refinancing risk should no
longer be the major concern as
Indonesia’s fundamentals have
improved, and investment grade
status is within a couple of years’
reach. All this is leading to an era
of easier access to financing.
Generally, the government
should no longer be too concerned about the prospect of being locked out of the markets and
unable to fund the budget deficit.
In this regard, the additional cost incurred from issuing
long tenor instead of short tenor is starting to look less justifiable. Given the current shape of
the yield curve, issuing a one-year
bill in place of a 20-year bond can
reduce the annual interest payment by a staggering 3 percentage points.
The issuance of more shortterm T-bills should also be taken
in the context of deepening the
market. Local banks have hundreds of trillions in excess liquidity that the government could tap
into. Cooperation with Bank Indonesia in using T-bills as a monetary instrument (which has
stalled for years) should again be
restarted.
The government can even go
further to introduce very short
tenor T-bills, with a maturity of
less than a year, for bridging the
seasonal financing gaps that stem
from time differences in spending and revenue collection.
For example, issuing one- and
three-month T-bills instead of
long-term bonds to bridge the early-year cash shortage would likely
be much more efficient. Not only
are T-bills cheaper in cost, they
could also be timed to mature in
April when money from tax collection fills up the government’s
coffers. This way the chances of
paying excessive interest on idle
money just might be significantly reduced.
The prudent fiscal policies in
which the government has held
dear for so long are finally bearing fruit. The opportunity has
risen to put things further to our
advantage. Now is the time to
take it.
The writer is an economist at Bank
Danamon Indonesia. The views
expressed herein are personal.
The President Post
January 17, 2011 B5
Technology
Getting Ahead
How Indonesia is Using ICT
to Boost its Standing Among
its Neighbours
“If IT infrastructure in the larger parts of the country can be improved, good education can then be delivered through
e-learning to the remote areas and isolated islands, so that the gap on the quality of education among different parts
of Indonesia can be reduced.” - Sutanto Hartono (President Director PT Microsoft Indonesia)
T
he Indonesia’s government believes
that IT is an essential driver of
c ompet it ivene ss
and national economic growth. ICT initiatives
by Indonesia’s government: Establishment DETIKNAS (National ICT Council) to create
ICT based framework and blueprints as a foundation for every
government agencies to collaborate with more efficiency, better
transparency and better collaboration, Palapa Ring program in
ICT that would connect many
big cities inter-island (national network) via fiber optic cable.
The technology of the network
is circuit switch or IP based network.
Microsoft concurs that IT
plays a significant role and as
the world’s largest software company, we have the global experience and innovative technology
to partner with the government
to advance national priorities and
in turn accelerate our business.
Microsoft contributes to people development through teacher
and student education programs,
partner education, local IT software industry development, innovation centres and training.
Some of our “mindshare competitors” have made significant
foreign direct investment in line
with their manufacturing business model, however we want to
move the conversation away from
physical investments to the importance of developing Indonesia’s human capital.
According to President Director PT Microsoft Indonesia, Sutanto Hartono, Indonesia has
infinite potential to increase its
national competitiveness. First,
being one of the most stable economies in the region, Indonesia has
the economic capacity to create a
high standard of living for its citizens. Second, it has an extensive
high quality labour force, so it
has the human resources needed
to support innovation. Thirdly, it
has abundant natural resources,
especially in oil, gas and minerals. All these factors support the
nation’s quests to be more competitive in the regional and global
level. In spite of these advantages, Indonesia is still facing a lot of
challenges. One major challenge
faced by Indonesia is its digital divide – due in part to the dispersed
geography and wide gap in socioeconomic levels.
Around 40 million Indonesians use the internet, and yet internet penetration is still low, at
17 percent. The Indonesian government wants to push that figure to 50 percent by 2015. This
year, The Center for Rural Telecommunication and Informatics (BTIP) of Directorate General of Postel, US$38 million in
an effort to connect the country’s
72,000 villages with broadband
internet cabling.
Technology providers are playing a key role in the digital inclusion effort. Through technological milestones and strong
partnerships with governments,
NGOs, educators and academics,
Microsoft has come up with the
Citizenship ‘Unlimited Potential’
programme, an initiative focused
on delivering solutions in education, innovation and job opportunities – three interrelated areas
that are fundamental to economic growth. In other words, Microsoft is tapping the unlimited
potential, or in Bahasa Indonesia, the ‘potensi yang tak terbatas’
of technology, to bridge the digital divide and boost Indonesia’s
competitiveness.
For example, Microsoft has
been working hand-in-hand
with the government and other key stakeholders to transform
education in the country. “Indonesia is spread out in 17,000 islands and IT infrastructure development has been focused in
the big cities and towns of Java Island and some key cities in out of
Java Islands. If IT infrastructure
in the larger parts of the country
can be improved, good education
can then be delivered through
e-learning to the remote areas
and isolated islands, so that the
gap on the quality of education
among different parts of Indonesia can be reduced,” said Hartono. By ensuring standardized
high quality education across Indonesia, the nation would therefore increase its national competitiveness.
Microsoft proposes the following steps to help bridge the education divide using IT:
Cloud computing for students
Affordable solutions for going digital have been provided
with online portals like Live@
edu – a cloud computing Software as a Service from Microsoft,
which is a free online suite to enable collaboration and communication among students, teachers and parents. It has an email
system, Office Web Apps, webmessenger, blog and online storage systems. In 2009, more than
130,000 Indonesian students enjoyed the benefits of Live@edu.
There has been an approximately 70 percent increase in Indonesia this year, with more than
220,000 students now using
Live@edu in schools.
One main benefit on the
Live@edu cloud computing service is that the school don’t have
to invest and manage the IT infrastructure to provide all of these
services. All school have to do is
to customize the domain name
(to reflect the school name),
which could be free or very low
cost (as low as US$ 9/annum).
The other main benefit for the
student is that the student can
own the email id even after he/
she graduated from the school.
Access to high quality
developer suites for High
Schools, Vocational Schools,
and Higher Education
Free technology has been given to students, such as through
DreamSpark program, an initiative which provides free-of-charge
Microsoft software to students.
Within 2009-2010, 118,000 students in Indonesia were given access to these tools. We will target
in 2011, another 120,000 students to be exposed, bringing
the total number of students that
have access to the software tools
to 238,000
Student-2-Business and IT
Academy programmes have also
provided technology training to
more than 10,000 students in
Microsoft Innovation Centres
(MIC) located in five universities: University of Indonesia (UI),
Bandung Institute of Technology (ITB), Gadjah Mada University (UGM), Tenth of November Institute of Technology (ITS)
and Pelita Harapan University
(UPH). MICs have also provided students with access to learn
about the latest Microsoft technologies.
Entrepreneurship program for
Post Graduation
Opportunities for entrepreneurship have been enabled with
the provision of accessibility to
Microsoft software and technology. This has been achieved
through the BizSpark and
WebsiteSpark programmes.
The initiative provides technology training through the BizSpark camp programme, as well as
business readiness through Spark
Gathering activities. In addition,
it works hand-in-hand with other institutions, such as the United
States Agency for International
Development (USAID), to provide additional business support
through business competition
and relationships with investors.
IT Capacity Building Program
For teachers
To support digital literacy proliferation, teachers have been introduced to Information and
Communication Technologies
(ICT). For instance, IT-Capacity building for teachers and students, which entails ICT and
Digital Literacy trainings, has
been provided through peercoaching. Since its implementation, the programme has trained
22,000 teachers, which in turn
creates a multiplier effect that embraces around13 million students
in 12 provinces in Indonesia.
For example on December
2010 Microsoft have conducted
IT training for teachers around
the Community Technology
Center (CTC) in Cirebon. The
CTC in Babakan, Cirebon is one
out of the ten CTCs that TIFA
Foundation established with the
Microsoft CTSP grant last year.
Starting with only 5 PCs, there
have now 22 PCs in the CTC
and its IT training are certified
by the local Diknas (Department
of National Education as to have
a standard of national curriculum for IT training. With this
certificate, participants are able
to enhance their IT skills and get
a job.
There are many schools in
Cirebon who do not have any
computer labs therefore some
teachers take their students to the
CTC for their IT class. Students
can use the PCs in the CTC for
free. Based on this experience,
President Director PT Microsoft Indonesia, Sutanto Hartono.
Microsoft organized a training for teachers in the CTC surroundings. The first training was
attended by 60 teachers and they
will receive a certificate of basic
IT training. For this pilot project, there will be 60 teachers participating in the training. They
will be divided into 3 groups and
the teachers will receive a certificate of basic IT training.
According to master teacher of Partners in Learning, Rima
Malfiensy from Raffles Consultancy, teachers were very enthusiastic to follow the training.
“Teachers who was participating
in the training have really understood the importance of information technology in teaching
and learning.”Through continuous knowledge transfer process,
the Master Teachers can provide
their abilities in creating and developing digital teaching content
to other teachers. It started in
2003 with 50 Microsoft-donated PCs to train 350 teachers and
then 500 teachers in the second
year and 800 teachers in the third
year. The number of PCs used for
the program has also increased to
100 units.
Other efforts have also been
made to bridge the digital divide and increase competitiveness, particularly in the areas of
rural computing to enable jobs
and opportunities, said Hartono. By collaborating with local governments, businesses and
local NGOs, Microsoft seeks to
address the marginalization of
farmers and workers through the
Community Technology Skills
Programme (CTSP). As of to-
day, Microsoft has built over 120
Community Technology Centres
(CTC) throughout Indonesia to
introduce IT to communities in
the hope of “widening their horizons and empowering them to
make informed choices”.
One such community is in
Bantul, Yogyakarta. Through
IT, the community has learned
to search for information in the
internet and explore methods of
organic farming. “The sales value of 100% organic rice is higher
compared to ordinary rice, so the
people have decided to intensify
their organic production,” said
Hartono. Such valuable information would help to bridge the income gap between the rich and
the poor, and as a result facilitate
Indonesia’s goal of achieving national competitiveness.
Another initiative takes place
in Cilacap, where education in
email, instant messaging and video conferencing has connected
overseas migrant workers to their
families and hometowns in Central Java.
With these programmes set in
place, the road is paved for more
e-government services in the future – something that can greatly
boost Indonesia’s national competitiveness. “The use of ICT
can reduce costs significantly in
e-procurement, e-clearance and
improve efficiency through remote services and e-commerce,”
said Hartono. This could change
the entire social, economic and
political landscape of Indonesia.
The opportunities are infinite –
and this is only the beginning.
The President Post
B6 January 17, 2011
Property
Outlook Steady for 2011
Jakarta Property Market
Recognizing the prospects for continued
growth in population size and wealth
demographics in Jakarta, the retail sector is
expected to see further new foreign retailers
entering the market in 2011, as well as the
opening of additional outlets by existing
players. Food & Beverage retailers are
expected to continue dominating leasing
demand within the Greater Jakarta area.
I
RI’s economy to grow by 6.5%
ndonesia’s central bank
raised its 2011 economic growth forecast to
as much as 6.5 percent
from an earlier forecast
of 6 percent as signs of
accelerating consumer spending
continue. Bank Indonesia projects that 2011 growth will be a
continuation of this year’s third
and fourth quarter trends, which
reached 5.8% and 6.1% (projected) respectively.
The Rupiah strengthened
14.6% percent during 2010 as
foreign funds sought to take advantage of Indonesia’s strengthening economy. 2011 inflation is
projected at between 4 to 6 percent, similar to 2010 year-end
levels.
The SBI 1-month rate remained stable at 6.5% throughout the 2nd half of 2010 and Investment Credit decreased slightly
from 13.5% at the end of 2009 to
13.4% by the end of 2010.
Given the continued improvement of the overall business and
economic environment Indonesia’s property market appears
set for further improvements in
2011.
Improving demand for CBD
Offices in line with continued
economic growth
Demand is expected to increase over the next 2 years in
line with projected improvements
in the economy and overall business climate. Office space absorption within the Jakarta CBD office market over the 4th quarter
of 2010 is expected to build on its
strong first nine months performance, continuing its recovery
from the effects of the global financial crisis and market downturn in 2009. In line with the
higher national economic growth
in 2010, total annual absorption
is projected to have doubled from
2009’s figure to over 200,000
sq.m, with occupancy rates likely to remain stable at 85%.
Average rentals are not forecast
to see further adjustment, as most
landlords already increased their
service charges at the beginning
of 3Q 2010. A likelihood of further increments is expected however, with a number of buildings
already planning to raise their
quoting rents for prospective new
occupiers and their lease renewal offerings for existing tenants.
This is in line with continuing
demand recovery, rising occupancy, and the economic growth
projections for 2011, despite the
forecasted new supply.
A further 56,500 sq.m within
two office projects in the CBD
area, is expected to enter the market before the end of 2010, being Sentral Senayan 3 and SCBD
Lot 18 Office tower 1. As of the
end of 2010, the total cumulative supply of Jakarta CBD office space will reach 4.13 million
sq.m. Other major office projects completed within the CBD
area during the year were: Equity Tower (83,600 sq.m) in SCBD
and Bakrie Tower (60,000 sq.m)
in Rasuna Epicentrum. Both of
these projects are strata-title office buildings, and were representative of the current health of
the Jakarta strata-title office market, which experienced strong
demand for strategically located
and sensibly priced projects from
reputable developers during the
year.
The cumulative sales rate of
existing strata-title office projects
stands at approximately 91%,
with largely local based companies looking at strata title office
ownership as an alternative to
their current rented accommodation. As of the end of 2010, the
strata-title office supply will represent around 15% of total office
supply in the Jakarta CBD office
market.
The CBD office market will
see additional supply of about
253,000 sq.m in 2011. This new
supply will include office projects
such as Tempo Scan Tower, K
Link Tower, Multi Vision Tower, Allianz Tower, AXA Tower
and Office 8. Only Tempo Scan,
K Link and Allianz Towers are
office buildings purely for lease,
with the remainder being stratatitle projects (either partly for sale
or fully for disposal).
Further new foreign retailers
set to open outlets
Recognizing the prospects for
continued growth in population size and wealth demographics in Jakarta, the retail sector is
expected to see further new foreign retailers entering the market
in 2011, as well as the opening
of additional outlets by existing
players. Food & Beverage retailers are expected to continue dominating leasing demand within
the Greater Jakarta area.
No further retail projects
are scheduled for completion
through to the end of 2010. An
additional 33,000 sq.m new supply will come from the completion or extension of existing centers in the fourth quarter, such
as Epicentrum Walk and Tanah
Abang Blok B. The total cumulative supply as of the end of 2010
will reach 3.56 million sq.m;
comprising (67.7%) retail centers
for lease and (32.3%) strata-title
retail centers. New retail centers
completed during the first three
quarters of 2010 included 2 strata-title projects, namely Jakarta Gems Center Rawabening in
East Jakarta and Tanah Abang
Blok B in Central Jakarta; 3 specialist / supporting retail centers,
such as Epicentrum Walk (CBD
Jakarta), Menteng Central and
C’One Plaza (Central Jakarta);
and 1 one-stop retail center, Gandaria City (South Jakarta).
Though the active leasing market during 2010 brought the average occupancy to 78%, a temporary decline in occupancy is
expected in 2011, pending retailers in large-scale retail centers completing their fit-outs and
commencing trading. In the year
ahead, the Jakarta retail market
will experience further additional
supply of large-scale centers within mixed-use developments, such
as Kuningan City (55,000 sq.m),
Grand Paragon (40,000 sq.m)
and Kemang Village (56,000
sq.m).
As the performance of stratatitle retail centers in Jakarta has
not seen improvement, it is likely
that there will be limited further
supply of strata-title retail centers
in the future.
As strong competition in the
retail market continues, rentals
are expected to remain stable and
landlords will remain cautious in
escalating their rentals. Service
charges will likely to increase following on from the increase of
the electricity tariff in July 2010.
Trend towards condominium
living in the Jakarta CBD to
stimulate demand
The move to high-rise living in
Jakarta within both owner-occupied condominiums and rental
apartments is set to continue, given limited land availability and
the practicality of vertical living.
Condominiums in the heart of
the city are also a solution to the
increasing traffic congestion and
Market Highlight
Market Outlook 2011
Leasing/Sales
Activity
Property Sector
CBD Offices
Permintaan meningkat di kawasan CBD Jakarta sesuai pertumbuhan ekonomi
Retail
Beberapa peritel asing akan masuk
Condominiums
Trend menuju bermukim di kondominium di Jakarta CBD akan memicu permintaan
Rental Apartments
Permintaan meningkat di tengah persaingan ketat
Industrial
Tahun yang baik bagi kawasan industri
lengthening commute times. Despite this, buyer motivations in
the Jakarta CBD remain equally
divided between investment returns and owner-occupation (as
primary or secondary homes).
By the end of 2010, total cumulative supply of condominium units in Jakarta is forecast to
be approximately 80,700 units.
9 projects will have been completed during the year, namely
Gandaria Heights, Centro City
(Tower A), Tamansari Sudirman,
Pakubuwono View, Central Park
(Alaina Tower), Green Central,
Seasons City, Masion @ Kemang, and Gading Nias (Emerald), while the total number of
proposed condominiums being
sold in the market and projected to complete within the next
two years amounted to 50 projects with a total of approximately
19,000 units. Despite the quantum of this future supply, the current pre-sales rate of these projects
is already around 56%.
Occupancy/Sales
Rate
ment and purpose-built rental
apartment sectors as they compete with the flexible terms offered by the condominiumsfor-lease owners. Some serviced
apartments however, especially those with better quality operators, may start to increase their
asking monthly rental rates due
to the increase of their operation
costs following on from the increase of the electricity tariff in
July 2010.
will have experienced decreasing supply during the year (of 52
units) due to conversion of rental units to strata-title condomonium units in Menara Budi and
Residence at Puri Casablanca.
Purpose-built rental apartment
supply in 2011 will largely come
from serviced apartments or ‘condotel’ units.
By end of 2010, the cumulative supply of rental apartments
will have increased by about 7%,
over 2009, bringing the cumulative supply to 39,300 units.
This additional supply mainly
came from condominiums-forlease of about 2,500 units, while
both purpose-built rental apartments and serviced apartments
2010 is projected to have recorded the largest demand for vacant industrial land in the last 5
years and also seen significant additional supply of over 700 Ha,
mostly within existing industrial estates (IE’s) in the Bekasi and
Karawang areas, which remain
the sought after industrial estate
locations.
A positive year for industrial
estates and looks set to
continue
Rental rates/Sales Price
Unlike previous years, in 2010
there was no particular industry
which dominated the market demand, however several business
lines including automotive and
steel related industries, were notably active. With the relatively stable political situation and
more positive economic conditions, 2010 also saw a number of
overseas industrial occupiers, especially from Japan, re-enter the
market and these foreign companies are expected to be the major
demand generators in the short to
medium term.
A combination of increasing demand and the strengthening of the Rupiah against USD
is expected to result in achieved
land prices growing by over 10%
and 15%, in Rupiah and USD
respectively during the year (to
about Rp. 700,000 per sq.m or
about USD 80.00 per sq.m).
With new supply unlikely to be
ready for immediate construction
and overall limited good quality
stock, land prices are expected to
continue their upwards trend in
2011. Whilst the market is projected to remain strong in 2011,
it is unlikely to reach the demand
levels of prior to the monetary
crisis in 1997, but nevertheless
will continue in its current positive direction.
Media Contact:
Dharmesti Sindhunatha
dharmesti.s@ap.cushwake.com
tel. 021 2550 9500 / 0812 10 13 512
Cushman & Wakefield Research
Arief Rahardjo
Associate Director
0811 909 711
Kepala Peneliti
Wira Agus
Associate Director
0813 1122 3347
Daerah Industri
Soany Gunawan
Senior Manager
0812 104 4978
Ritel
Nurdin Setyawan
Assistant Manager
0811 1905 252
Perkantoran
Elizabeth Tanti
Analis Senior
0818 732 393
Apartment & Kondominium
Future condominium supply
will mostly be within the middlesegment, representing some 60%
of the total proposed supply. The
market will see new supply within mixed-use complexes in the
Jakarta CBD, such as in Kuningan City, Ciputra World, Rasuna
Epicentrum, Kota Kasablanka,
and Thamrin City. Meanwhile,
the prime residential area will
continue to target the upper-segment, as has been the case over
the last few years.
In the current competitive
market, the developer’s commitment to on-time project delivery
and meeting the promised development quality will become increasingly important in ensuring
a successful sales performance.
With the expected reduction in
mortgage rates, the appetite of
condominium buyers is expected to grow in 2011, with those
condominium projects offering
a unique concept, extensive support facilities, and strategic location, able to command higher
prices.
Improving rental apartment
demand but still strong
competition
In the Rental Apartment leasing market, the higher level of
leasing inquiries towards the end
of 2010 will likely lead to an increase in leasing transactions and
a modest improvement in occupancy starting in early 2011. The
physical occupation of condominium-for-lease units completed
in 2010 is also expected to see an
improvement as we move into the
2nd half of next year, as a minimum of 6 months is required to
hand-over, fit-out and market the
units. Local tenants are expected
to generate increased demand, especially for condominiums-forlease which are in close proximity
to work places or universities.
The predicted economic
growth in Indonesia in 2011 is
also expected to have a positive
impact on expatriate arrivals. Demand from oil and mining, and
telecommunication companies
is predicted to remain active, together with a return to higher demand from banking & finance
related companies.
A more competitive rental
market may be likely however,
given the high competition from
strata-title condominium owners
offering their units to the rental
market. This may also see the offering of shorter term leases such
as weekly or even daily rates, being offered in the serviced apart-
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PT. UP Alumindo
PT. Timurraya Kurnia Manunggal
PT. Timurraya Karya Mandiri
PT. Niparindo Saritama
PT. Intraparr Nusantara
PT. Arta Boga Cemerlang
PT. Jute SCI-Tech Indonesia
PT. Sekawan Artistika Tataprima
PT. Sumber Aneka Karya Abadi
PT. Aptar B&H Indonesia
PT. Mulia Makmur Electrikatama
PT. Metal Jaya
PT. Conex Inti Makmur
PT. Lie Vonny,Ny/Cikarang Primatex
PT. Global Wijaya Tool
PT. Avcomindo
PT. Varianto Gunawan & Edwald/ Tunas
Mitra Sukses
PT. Trimulya Gemilang
PT. Unichem Indonesia
PT. Altek Mitra Presisi
PT. Mitra Perkasa Ekatama
PT. Bhineka Cipta Karya
PT. G & B Indonesia
PT. Trans Bainitic Teknikatama
PT. Sentramitra Dayautama
PT. New Asia Dynamic Indonesia
PT. Elcapack Jaya
PT. Show Laser
PT. Jeil Pacific Plating
PT. Platindo Sinar Sakti
PT. Mitra agung Sejati
PT. Tokai Texprint Indonesia
PT. Sumber Rejeki
PT. Yayasan Batu Karang Teguh
PT. Galaxi Indah One
PT. Yi Su Electronics
PT. Electrindo Contruction
PT. JNB Jaya
PT. Jin Sung Tech
PT. Hans Jaya Utama
PT. Astrazeneca Indonesia
PT. DGW Chemicals
PT. Tiga Dua Delapan
PT. Federal Superior Chain MFG.
PT. Sinisa Contruction
PT. Primasindo
PT. Zhulian Indonesia
PT. Samoin
PT. Pulo Air Biru
PT. Busfimac Indo
PT. Sumi Agung Corporation
PT. Indiarta Tata Gemilang
PT. Kompresindo Utamajaya
PT. Cika Tunas Mulia
PT. Samindo Inti Leather
PT. Karyapratama Dunia
PT. Karya Pratama Dunia/Jusuf Kahar
PT. Hayashi Unggul Industry
PT. Masaro Radiokom
PT. Fondannusa Aditama
PT. Rangalo Nusantara Jaya
PT. Karya Tunas Mustika
PT. Certechs Indonesia
PT. Multiyasa Swadaya / Erha Gumelar
PT. Metalindo Estetika Dimensi
PT. Multi Sinar Selaras
PT. Denpoo Mandiri Indonesia
PT. Denpoo Mandiri Indonesia
PT. Indoteknik Mutuprima
PT. Binkomara Huma
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Binkomara
Meiji Rubber Indonesia
Meiji Rubber Indonesia
Inticomposite Figlasindo
Karya Pratama Dunia
Perajutan Abadi
Ping Cradia Indonesia
Sinar Cahaya Cemerlang
Sinar Cahaya Cemerlang
Mastalin Mandiri
Davico
Mitindo Usaha Sejati
Leonardus Hanjoyo /Tang Mas
Pancadaya Manunggal Sentosa/
Padamas Putera Sentosa
Liang Sheng Indonesia
EagleBurgmann Indonesia
LA Innomation Engineering
Inti Presisi Toolsindo
Pro Packing
Procoat Energi Baru
Rehau
Eun Sung Indonesia
Dipanusa Eltritama Putra
Sapta Buana
Sangwan Dinasindo/Hendra
Hadiwijaya
Sangwan Dinasindo
Sangwoo Indonesia
Koike Cermin Indonesia
Hiroshindo Manufacture
Sawang Makmur
Multi Rezekitama
Mirae International
We Tech
Global Chem
Alam Sumbervita
Sari Boga Kita
Kawan Lama Sejahtera
Sankay Jaya Mandiri
Indonesia Yun Cheng Laser Plate
Industry
Sinar Alam Sejahtera
Alex Purwanto
Distrindo Hosniaga
Lumba-lumba Bogarasa
World Metal / Kindsindo Farmatama
Myung In Tech
Prima Reksa Internusa
Datindo Entrycom
Nobel Chem Indonesia
SCK Metal Int Treatmen
Sam-plus Indotama Industry
Tiga Sekawan Perkasa
Sinar Cemerlang Lestari
Mirae Indonesia
Binkomara Huma
Stevanus Hardi
Totan Global Indonesia
Arlene Prima Pack Plastik Industri
Arlene Jayamandiri
Citra Arani Teknik
Klinik Adika
Skypak International
Hasura Mitra Gemilang
Lazuardi Rukun Perkasa
Hi-Tech Design Lab Engineering
Utama
Wahyudi Widjaja/Wahyunusa
Wahana
Dong San Indonesia
Metalindo Multidinamika Mandiri
Bumiraya Megaprima
Traktor Nusantara
Dong San Indonesia
Catur Khita Persada/Monique
Henriette Taufik
Suyuga Pratama
Lie Cavint Bp
Mitragondala Kreasi Prima /
Budiman Halim
Adi Citra Anggana
Dinamika Wijaya Kusuma
Dakfu Tamajaya
Didi Pardi /Tiga Bintang, Pd
Sri Suparti Ny
Global Mega Indonesia
Inno Tech
Saiki Die Cast
Djoyo Tunas Makmur Lestari
General Teknik Mahakarya
Sukmaco Eka Furina
O.M Indonesia
Penta Buana Duta
Southern Tristar
Indokor Indonesia
Sinar Sosro/Sasana Caraka
Mekarjaya
For more information:
JABABEKA CENTER
Marketing Gallery
Hollywood Plaza, no 10-12
Jl. H. Usmar Ismail - Indonesia Movieland
Kota Jababeka, Cikarang Bekasi 17550
Telp. (+62
21) 893 4570/80
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Central Auto Mobil Service
Fu Jyi Lin Indo Enterprise
Daehyun Bobbin Indonesia
Mulya Pratama Agung
Gobel Development Corp.
Tricipta Platindo
Ayumas Saddasa
Sekawan Putra Makmur
Dharma Electrindo Manufacturing
Kwang Jin Indonesia
Ratu Betala
Makitamega Makmur Perkasa
Dairygold Indonesia
Sinar Urip Mulia
Hibex Indonesia
Enfandy Dharma
Romindo Primavetcom
Borobudur Agung Perkasa
Lindawati Gani
Anjungan Parama
Inti Marindo Primacon
Astech Indonesia
Sinar Srikandi Eshalektrika
Kyoei Denki Indonesia
Anugrah Yonaseprima
Romindo Primavetcom
Aerosolindo Indah
Dairygold Indonesia
Kyoei Denki Indonesia
Makitamega Makmur Perkasa
Rejeki Adigraha
Sun Joo Enterprise
Gloria Origita Kosmetik
Udinda Aneka Sarana
Sun Joo Enterprise
Surya Multindo Industri
Doowon Precision Indonesia
Dawee Printing Indonesia
Tomy Hartanto,Bp
Muhtomas
Eon Chemicals Putra
Tekun Asas Sumber Makmur
Hoppecke Indonesia
Alfa Laval
Bernadi Utama
Kalden Indonesia
Tata Kompanika
Tjokro Bersaudara Cikarangindo
Haldin Pasific Semesta
Foodindo Investama/Fuji Junya
Kitagawa
Tamindo Permai Glass
Grace Specialty Chemicals
Indonesia
Dupont Powder Coatings Indonesia
Atozz Jaya Indonesia
Hci Converting Equipment
Mirae Tech Indonesia
Teknikatama Karya Mandiri
Roku Mitra Teknikatama
Dairygold Indonesia
Nippon Indosari Corpindo
Millenia Chemindo Pratama
Uniplas Ika Pratama
T.Rad Indonesia
Linfox Logistic Indonesia
Newstar Precision Industri
Metalindo Adi selaras/ Migoto
Indonesia
Asti Panji Dikatama
Pollak Indonesia
Estilo Karpetindo Industri
Multi Mekanika
Kochem Indonesia
Sing Sung Indonesia
Star Indo Pratama
Rahmat Jaya
Indo Batam Ekatama
Future Tech
Indo Batam Ekatama
Haeng Sung Raya Indonesia
Seoul Press Indonesia
Hasta Perkasa Graha
Korryo Industri
Form Line Indonesia
Hoerbiger Indonesia
Geosadi Maprotec
Saripangan Mulia Sutidja
Metalindo Multidinamika Mandiri
Mastrada Surya
Ayakeh Team Indonesia
Wahyunusa Wahana
Weling Simbah Wulung
Hioe Masuki Kusuma, Mr.
Putra Hankuk
Grand Cikarang
Unilever Indonesia (MARGARINE)
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Binamitra Kwartasedaya
Unilever Indonesia Tbk. (Makanan)
Trilogi Surya Wisesa
Dept Keuangan RI
Berlina Tbk
Embossindo/Anex
Dharmala Intiutama/Deemte Sakti
Indo
Dynaplast /Unifoods Indonesia
Daelim Indonesia
International Paint Indonesia
Karunia Chandra Lestari
Indoniaga Sukses Makmur
Arya Perintis
Tyrex Indonesia
Kasana Teknindo Gemilang
Timbangan Digital
Gisma Cipta Sukses
Patratek Mezatoi Indonesia
Yokatta Indonesia
Shuket Engineering
DSI Laser Int”L Indonesia
Antartika Prima Indonesia/ Westes
Industri
Korind Jaya Abadi
Anugrah Pusaka Energi
Jeong In Tech Indonesia
Min Byung Suk/Ansan Wire
Dharma Sakti Mandiri
Art Wire
Tanla Tescor Welindo
Atandi Mitra Karya
Care Logistindo
Nur Kartika Cemerlang
Mae Logistic
Markindo Rekateknik
Putra Toolsindo
Longtjing Tandi
Bumi Alam Manunggal
Putra Toolsindo
Wira Sakti Lindu Arta/ Saka Arta
Kencana
Ketapang Sumber Rejeki
Fajar Surya Lestari
Jerlin Kencana Sakti
Luas Birus Utama, PT
Fadjar Sugiarto, Bp.
Iron Wire Works Indonesia
Multi Square
Java Mutiara Dwipa/Swasti candika
Prasama
Toyonaga Indonesia
Kanagata Teknologi
MC Wibowo,Bp
Young Jin Indonesia
Sinactrans Adhi Sakti
Aftech Rand Perkasa
Multi Buana Instrumindo/Buana
Multi Techindo
Yusamasu Tech Indonesia
Jeong Moon Information Indonesia
Inertia Utama
Wako Kogyo Indonesia
Bogorindo Cemerlang
Keo San Indonesia
Esmalglass Indonesia
Multi Lestari
Gemsung Indonesia
Alfa Mitra Lestari
Shinkansen Mitra Indonesia
Yan Primadi Koharsoebroto,Bp
Global Teknindo Berkatama
Global Indo Reksa
Hierrotama Indojaya
Buana Era Sarana Terpadu
Cikarang Hadi Mitra
Vinson Inti Pratama
Chung Han Electronics Indonesia
Drugscreen Laboratories Utama
Sinsung
TNZ Indonesia
Subur Indah Plastika Abadi
Shinhwa Techno Indonesia
Multi Buana Instrumindo
Saintifik Indonesia
Anugerah Baja Cipta
Autotech Perkasa Mandiri
Royalton Indonesia
Jasatama Galvanis Industry
Fajar Bashti
Surya Inti Alam
Rosyidah MS,Ibu
Mandiri Panca Prima
Van Laack Indonesia
Multi Lestari
Jasatama Galvanis Industry
Intipraja Tekno Industri /
Sehatiprima Sejahtera
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Air Product Indonesia
Chemco Harapan Nusantara
Samsung Electronics Indonesia
Tira Austenite
Sari Takagi Elok Produk
FeeLux
Asahi Diamond Industrial Ind
Lotron Indonesia
Cahaya Kalimantan Indah/Sinar
Harindotama
Sumber Makmur Lestari & Sejin
Indonesia
Masindo
Citra Aman Mandiri
Cahaya Sam Perindasa
BS Indonesia
Wilmar International
Sing Swee Bee Indonesia
Armindo Jaya Mandiri
Woongjin Textiles
Hume Concrete Indonesia
Chang Chun Duta Pertiwi Nusa
Chemical Industry
KMK Plastics Indonesia
Inkomas Lestari
Mattel Indonesia I
Matsumotoyushi Indonesia
KMK Plastics Indonesia
Cahaya Kalbar Tbk.
Lamberti Indonesia
Matraco Komponen
Alpha Beta Ciptakarya
Nihon Etching Indonesia
System Indonesia
Dong Yang Nisusindo
Yeonho Indonesia
Dongseo STS
Ire Tech
Megah Karya Abadi
Laser Metal Mandiri
Akarui Indonesia
Senatama Laboranusa
Soma Gede Perkasa
Tokyo Seiko Indonesia
Mitra Agung Sejati
Cisindo
Oriental Plastik
Foodindo Investama/PT. Kulinari
Boga Semesta
Minamas Gemilang
Mobilla Inti Utama
Triputra Sejahtera
Anugerah Sejahtera
Djoko Yoshua Mangowal
Mandiri Panca Prima
Andal Prima Sejahera
Dharmesta Swasti Mandiri
Fukoku Tokai Rubber Indonesia
Filter8 Indonesia
Super Label Indonesia
Ingress Malindo Ventures
Sarana Grafika Indonesia
Unitech Perkasa Engineering
Dinamika Makmur Sentosa
Dunggio Drilling
Fajar Basthi
TNG Energy Services Indonesia
Nurman Mitra Sentosa
Torama Asahi Mandiri
Gerfa Manunggal Teknindo
Menara Terus Makmur
Tarius Tatang Widjaya
Cahaya Abadi Selaras
Irwan Iskandar
BMT Bumiputra
Lestari Teknik Plastikatama
Asahi Diamond Industrial Indonesia
Lestari Teknik Plastikatama
Moldpia Technology Indonesia
Sinar Surya Graha Persada
Komatsu Forging Indonesia
Komatsu Undercarriage Indonesia
Arbe Chemindo
Evonik Degussa Peroxide Indonesia
Liang Feng Industries
United Tractors Pandu Engineering
Menara Terus Makmur
Pharmacore Laboratories
Alimindo Sejati
Fajar Surya Lestari / Jerlin Kencana
Sakti
Vanwin Nusantara
CK International
Utama Daya Teknik
Leatat Chemindo
Decalindo Pratama
Erha Pharma
Pharmacore Laboratories
PT. Electron Parts Technology
Indonesia
PT. Cahaya Sukses Mandiri
PT. Design Shop Prima International
PT. Olahan Sawit Persada
PT. Leoco Indonesia
PT. Showa Indonesia
PT. BASF Contruction Chemicals
Indonesia
PT. Showa Indonesia Manufacturing
PT. Katsushiro Indonesia
PT. Dinar Makmur Cikarang
PT. Showa Indonesia Manufacturing
PT. Ochiai Menara Indonesia
PT. Mitrakusuma Sejahtera Indonesia /
Multi Echo Cipta
PT. Selectrik Indonesia
PT. Adhiguna Alferindo Sejahtera
PT. Humpuss Trading
PT. Varsindo kimia Abadi
PT. Santa Tri Decorindo
PT. Naga Pacific
PT. Metalindo Pacific
PT. Credit Up Industry Indonesia
PT. Asia Channel Otopart
PT. Sehatiprima Sejahtera
PT. Indonesian Marine Corp Ltd
PT. Hunter Douglas Indonesia
PT. Super Intermetal Abadi
PT. Sung Woo Platech
PT. Chemoko Eka Perkasa
PT. Panel Bakti Sinarindo
PT. Mega Kemiraya
PT. Futurinsan Sonsindo
PT. Banshu Plastic Indonesia
PT. Bumi Polymas Indutries
PT. Shangrila Nirvana Indonesia
PT Keintech
PT. Arvico Electronics Indonesia
PT. Naga Pacific
PT. Ferron Par Pharmaceuticals
PT. Dian Satya Dipasatria
PT. Brataco / Herman Peley
PT. Mastalin Mandiri
PT. Multiguna Cemerlang
PT. Dewondaru Sekar Mulia
PT. Capcom
PT. Paradhya Ista Teknik
PT. Byung Hwa Indonesia
PT. Foodex Inti Ingredients
PT. Esecodharma Permai
PT. Kharisma Mustika Megasari
PT. Nara Citra Otowarna
PT. Citra Plastik Makmur
PT. Triimitra Chitrahasta
PT. Triimitra Chitrahasta
PT. Ultimax Mitra Agung
PT. A & P Indonesia
PT. EAC Indonesia
PT. Libra Emas Permata
PT. Trimitra Chitrahasta
PT. Golden Time Co. Ltd.
PT. Brataco Chemica
PT. Jaya Trade Indonesia
PT. Sumber Karya
PT. Mysa Jaya Rubberindo
PT. Madusari Nusaperdana
PT. AE Automotion Indonesia
PT. Multi Usage Indonesia
PT. Ultrakindo Crestec Indonesia
PT. Fuchs Indonesia
PT. Gema Bahana Grafika
PT. Dharma Precision Parts
PT. EagleBurgmann Indonesia
PT. Fuchs Indonesia
PT. Sintertech
PT. Dharma Precision Parts
PT. NIC Indonesia
PT. Fleksi Komponen
PT. Triomulya Indah
PT. Pangan Sehat Sejahtera
PT. Tecno Metal Industry
PT. Supra Sukses Trinusa
PT. Ahara Prima Design
PT. Multikarya Tata Bersama
PT. Walindo Jaya Abadi
PT. Dongwoo Environmental Indonesia
PT. Pema Meta Presindo
PT. Bohler Welding Group Shout east
Asia
PT. Se Min Metal Indonesia
PT. Samyong Recycling Technology
PT. Suzuki Engineering Center
Indonesia
PT. Chiyoda Kogyo Indonesia
The President Post
B8 January 17, 2011
Executive Highlights
Finance Minister Agus
Martowardojo said it
would provide letters
of guarantees to three
priority infrastructure
projects
under the public private partnership (PPP) scheme. The projects are the US$3 billion, 2x1000
MW coal-fired power project
at Pemalang, Central Java; the
US$750 million railway project
linking Manggarai station, Jakarta with Soekarno-Hatta international airport; and the US$250
million water treatment facility at
Umubulan, East Java. Agus said
the risk coverage for the three
projects would be more extensive
than existing guarantees provided for power projects under the
10,000 MW power acceleration
program. He said the new guarantees would include coverage
against license cancelation and
operational risks over construction, land clearing and supply of
electricity and coal. The minister said there were seven potential
investors from three countries
looking to place bids for these
three projects, though he declined to provide further details.
Agus stated that two projects under the government’s PPP scheme
would not be provided with letters of guarantees: the US$450
million toll road linking Medan
and Kualanamu airport in North
Sumatra; and the US$40 million
Tanah Ampo cruise ship terminal at Karang Asem, Bali.
high inflows. Most analysts see
the central bank’s moves as a
positive step to manage excess
liquidity, although it will likely
hit lenders’ profitability and could
cause a substantial increase in the
cost of foreign currency loans.
The Djarum Group
has purchased Rp3.5
trillion worth of shares
in Bank Central Asia
(BCA)
Bank Mandiri said it
was looking to raise up
to Rp14 trillion from its
rights issue
to boost its stake in the lender by
2.3% to 50.2%. The shares were
bought at a price of Rp6,700/
share from undisclosed investors in a deal facilitated by Credit Suisse. Djarum used proceeds
collected from a 39% stake sale
in telecom tower operator Sarana Menara Nusantara in early
December - a deal worth Rp3.3
trillion - to help fund the BCA
share purchase, reflecting a portfolio shift into the banking sector from telecom. BCA has accumulated Rp6.8 trillion in profits
for the first nine months of 2010,
up 17% from the year earlier period. New loans increased by 8%
for January-September 2010 to
Rp119 trillion. As of end-September 2010, BCA had a loanto-deposit ratio (LDR) of 50.6%,
significantly lower than Bank Indonesia’s recommended LDR
range of 78-100%. BCA’s capital
adequacy ratio (CAR) for this period was 18.7%.
scheduled for this February, and
announced an indicative price
range of Rp4,000-6,150/share for
the deal. Like the secondary offering in November last year for
Bank Negara Indonesia (BNI)
the government, which has a
66.7% stake in Mandiri, will not
take up its entitlement of shares.
This will enable institutional
shareholders not currently shareholders in the bank to purchase a
stake in Indonesia’s largest lender.
Bank of America Merrill Lynch,
Deutsche Bank, Danareksa Sekuritas and Mandiri Sekuritas have
been appointed to manage the
deal. Bank Mandiri has stated
that it plans to use the proceeds
from the rights issue to strengthen its capital structure to support
loan growth and general business
expansion. The deal will reduce
the government’s stake in Mandiri to 60% and raise the lender’s
publicly floated shares to 40%,
qualifying it for a 5% corporate
tax rate reduction provided under
Indonesian tax laws.
Eddie Chin said the deal was in
Australia’s Kangaroo
line with its growth strategy and
provide significant synerResources has entered would
gies with the firm’s other assets.
into a US$277 million
scrip deal with Bayan
Resources to acquire U.S. Commodities giant
a majority stake in the Cargill has acquired
Pakar coal project
Indonesian industrial
starch and sweetener
in East Kalimantan. Upon completion of the deal, Bayan will producer Sorini Agro
acquire a 57% stake in Kangaroo. As part of the agreement, Asia Corporindo in a
Bayan will also incorporate nine US$244 million deal.
coal concessions near its Tabang
mines in East Kalimantan into
Kangaroo. Bayan said Pakar and
the nine coal concessions combined would have coal reserves
of around 116 million tons and
coal resources totaling 3.8 billion
tons. Kangaroo managing director Mark O’Keeffe said the deal
would reposition the company
as a world-scale Indonesian coal
producer, allowing it to unlock
its Indonesian assets by leveraging Bayan’s skills and experience.
He added that with Bayan’s support Pakar and the other concessions could start production this
year. Bayan president director
Selected Instant Indicators
GDP GROWTH (%)
%
Index*
2000=100
By Quarter
Year on Year
8
Bank Indonesia kept
its benchmark rate
at a record low of
6.5% For the 18th
consecutive month
following its 6 January meeting,
despite mounting inflation pressures. Consumer prices hit 7%
year-on-year in December, 100
basis points above the upper end
of the central bank’s 2010 inflation target. The bank did, however, take a more hawkish stance
in its board of governors’ statement, asserting that it was fully aware of inflationary pressures that could increase in the
future. Central bank executives
have previously stated that they
were prepared to raise rates at
any time if conditions warranted
it. At the same time, Bank Indonesia governor Darmin Nasution
said current inflation pressures
still stemmed largely from volatile foods and rising commodity prices, and indicated that raising rates now would have limited
impact. He noted that core inflation, which strips out volatile
foods, remained relatively modest at 4.2% year-on-year. The
governor asserted that Bank Indonesia’s main focus now was to
manage surging capital inflows.
These efforts, however, prevent
the rupiah from strengthening,
perhaps helping exports, but also
keeping rupiah prices high.
Flagship carrier
Garuda Indonesia
has signed a deal
to restructure nearly
US$500 million in debt
after five years of negotiations. The creditors included the European Credit Agency,
France’s Compagnie Française
d’Assurance pour le Commerce
Extérieur, Germany’s Euler
Hermes and more than a dozen
commercial lenders. As part of
the deal, Garuda chief executive
officer Emirsyah Satar said both
sides agreed to extend the maturities of unpaid loans to mid-2016
with repayments to be made in
installments of US$45-60 million a year. He said the debt restructuring agreement would
pave the way for a US$300-400
million initial public offering
planned for later this year to fund
its expansion. The carrier is looking to bring the number of planes
in its fleet to 120 aircraft from
84 currently. The chief executive also remarked that the deal
would open the door for cheaper
loans from domestic banks, and
make it easier for Garuda to add
routes to Europe and fly to new
destinations such as India.
A consortium led by
global private equity
firm Texas Pacific
Bank Indonesia
Capital (TPG Capital)
announced new
has acquired a major
measures to deal with stake in Indonesian
the influx of foreign
mining services firm
portfolio inflows.
Delta Dunia Makmur
Under the new rules, commercial
banks will be required to hold 5%
of their total third-party foreign
currency deposits in reserves at
the central bank starting from
March, up from 1% at current
levels. This will be subsequently
raised to 8% starting in June.
Bank
Indonesia
governor
Darmin Nasution said the new
regulation was expected to drain
US$3 billion in excess liquidity.
He said the central bank has also
reinstated a cap on commercial
banks’ overseas borrowings of
30% of their capital starting this
month to try and minimize the
risk of sudden capital outflows.
The governor asserted that the
emphasis now was to manage
capital inflows by adjusting
reserve requirements, deepening
the capital markets and keeping
a close eye on global financial
volatility. He added that with
these measures, Bank Indonesia
would be able to avoid tougher
capital controls to discourage
165
7
155
6
145
5
135
4
3
125
2
115
1
105
0
95
05
07
06
09 Q1
08
Q3
Q2
Q1
Q4
Q3 Q1
Q2
2005
Q4
2006
Index
Q3
Q2
Q1
Q4
Q3
Q2
2007
Q1
Q4
Q3 Q1
Q2
2008
Q4
2009
Q3
Q2
2010
INFLATION 66 CITIES
107.0
General
Food
WPI
104.9
103
100
97
Des
09
2009
J
10
F
Mar
A
M
Jun
J
Aug
S
O
Nov
D
S
O
Nov
10
2010
EXPORT AND IMPORTS
(US$ Million)
Exports
16,000
Imports
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
Nov
09
D
2009
Jan
10
F
Mar
A
M
Jun
J
Aug
2010
*Q4 2000=100
in a US$400 million deal. Ashish Shastry, TPG Capital’s head
for Southeast Asia, said the deal
was one of the largest equity investments in Indonesia, though
he declined to provide further details. TPG Capital partnered with
Singapore sovereign wealth fund,
Government of Singapore Investment Corp. (GIC), and Chinese
sovereign wealth fund, China Investment Corp. (CIC), for the
acquisition. Although CIC has
previously funded major deals
in Indonesia, including a US$1.9
billion debt deal last year with
top coal miner Bumi Resources,
it is the first equity investment in
Indonesia for the Chinese investment fund. Shastry said the latest deal reflected its confidence in
the long-term prospects of Indonesia’s coal sector. Delta Dunia is
the country’s second-largest coal
mining contractor through its
wholly owned subsidiary Bukit
Makmur Mandiri Utama.
COMMODITY PRICES
Sumatran Light
US$/barrel
Mal$ per
metric ton
$91.3
Crude Oil-LHS
Palm Oil-RHS
88
4,000
M$ 3,814
3,750
3,500
83
3,250
$79.4
3,000
78
2,750
73
2,500
M$ 2,578
68
Des J
09 10
2009
2,250
F
Mar
A
M
Jun
J
Aug
2010
S
O
N
D
10
potential of Indonesia’s healthcare sector as economic growth
and wealth generation drive demand for quality healthcare. He
added the deal would offer the
trust a foothold to expand across
other locations and medical facilities in the country. As part of
the deal, Lippo Karawaci will act
as master tenant of the hospital
properties. First REIT will have
first right of refusal to acquire
new healthcare facilities that Lippo Karawaci develops. According to Lippo Karawaci president
director Ketut Budi Wijaya, First
REIT could potentially purchase
25 hospitals that the firm plans to
build over the next five years to
meet growing demand for healthcare services in Indonesia.
State power utility PLN
has secured a Rp1.1
trillion syndicated
loan to help finance
construction of its
transmission lines on
Java.
Nestle Indonesia said it
plans to invest US$100
The bank syndicate comprised million to build a new
Bank Mandiri, BCA, BNI and
BRI. The loan was guaranteed by production facility in
the Indonesian government and
has a 10-year tenor with a three- West Java
year grace period. PLN president director Dahlan Iskan said
the deal meant the firm has secured its financing needs to build
its transmission infrastructure as
part of the first phase of the government’s 10,000 MW power acceleration program. The chief
executive remarked that, once
completed, the upgraded transmission infrastructure would
help PLN save up to Rp3 trillion
per year. The planned transmission lines will support the 3x200
MW coal-fired plant in Banten
that came on line last year and
the 3x300 MW coal-fired plant
in Indramayu, West Java and
3x300 MW coal-fired plant in
Rembang, Central Java that are
both scheduled to start operating
this year.
Mitsubishi Corp. Has
extended a US$120
million loan to Medco
Energi International to
support the financing Singapore’s first Real
of the Donggi-Senoro Estate Investment
LNG project
Trust (REIT) has
acquired two
in Central Sulawesi. Mitsubishi
and Medco are partners in the Indonesian hospitals in
project, together with Pertamina. Mitsubishi has a 51% stake a US$160 million deal
in Donggi-Senoro, with Medco with Lippo Karawaci.
holding a 20% interest and Pertamina 29%. Funds from the
loan will help finance Medco’s
portion of the project. The loan
carries an interest rate of London
interbank offered rate (LIBOR)
+ 3.75-4.75%. The loan was extended despite US$3.5 million
in fines imposed on Mitsubishi,
Medco and Pertamina by com-
109
106
Cargill Asia-Pacific president
Bram Klaeijsen said Sorini was
a business with an attractive asset footprint, solid customer base
and broad product portfolio.
He asserted that the acquisition
would support future growth of
Cargill’s businesses in Indonesia and South East Asia. Sorini’s
products are used by consumer
goods companies like Nestle and
Unilever as components for the
production of toothpaste, vitamin C tablets, chewing gum, soft
drinks and ice creams. The firm
currently operates two starch
sweetener plants and five starch
plants in East Java and Lampung.
Cargill purchased 85% of Sorini
from chemicals distributor AKR
Corporindo and securities firm
UOB Kay Hian Pte Ltd. It plans
to hold a tender offer for the remaining Sorini shares held by the
public next month.
petition watchdog (KPPU) earlier this year for allegedly violating competition rules over
Donggi-Senoro. The KPPU ruling specially stated that the project should continue, and senior
government officials like oil and
gas director general Evita Legowo have also stated that the project would proceed this year despite the ongoing dispute.
The hospitals are the Siloam Hospitals Lippo Cikarang in Bekasi,
West Java and the Mochtar Riady Comprehensive Cancer Center in Jakarta. First REIT senior
executive Dr. Ronnie Tan said the
acquisition underscored the huge
to serve growing local demand
for its cereal and milk products.
The factory is slated for commercial operations by 2012 with a
15-hectare complex for the production of Cerelac infant cereal
and Milo chocolate milk drinks.
Nestle Indonesia currently imports its Cerelac and Milo products from Malaysia. The company said another investment was
earmarked for 2013 to expand
the planned West Java facility to
produce other product categories such as breakfast cereals and
value-added liquid milks. Frits
van Dijk, vice president for Nestle Asia, Oceana and Africa, said
the latest investment marked the
firm’s drive to expand its business
in Indonesia. The West Java expansion marks the second major investment made by Nestle in
the country, following a US$100
million investment last year to
expand the production capacity
of its milk processing facility in
Kejayan, East Java.
Business Highlights are
contributed to The President Post
by CASTLEASIA/PT Jasa Cita
from information supplied to
members of their CEO Forum,
the Indonesia Country Program.
They are reprinted here with
permission. For more information
about CASTLEASIA programs,
please contact Juliette or Wijayanti
at 62 21 572 7321 or email
castle@castleasia.com subject CEO
Forum
SECTION
The President Post
Economic Review
C
Rising
Honda
Production
AHM Indonesia produces 20% of the total production of Honda motorcycles around the world amounting to 15 million units, making
Indonesia the second largest production base of Honda motorcycles.
Government to Boost Manufacturing,
Agro-Industry Sectors in 2011
By Dewi Savitri
In an effort to propel economic growth this year,
the government of President Susilo Bambang
Yudhoyono is moving on to reinvigorate the
manufacturing and agro-industry sectors as the
major non-oil-and-gas contributors to state treasury.
T
his was announced
recently by Minister of Development Planning and
Chairperson of Bappenas (the National
Development Planning Agency)
who is upbeat about the government’s ability to spur growth this
year.
“For 2011, our plan is to accelerate economic growth that is fair
to all and this shall be made possible by implementation of better management and synergy between the central and regional
governments,” she says.
Her optimism is apparently based on the growth momentum of 2010 which she says needs
to be maximally tapped to generate further growth this year. And
to realize this, the government
intends to focus on boosting the
manufacturing and agro-industry sectors which are being relied
upon as good revenue generators
and altogether absorbers of big
numbers of jobseekers.
She explains that the strategy
of bolstering these two sectors is
meant to create multiplier effects
for other sectors of the national economy because these sectors
are closely linked with development of other sectors.
For instance, by boosting the
manufacturing industry, myriad opportunities will be created
for down-line employment and
in the process the sector shall be
strengthened by participation of
more people on the production
chain.
A clear example is as follows:
Boosting the automotive manufacturing industry shall lead to
spare parts industries sprouting
up everywhere along with automotive garages, leasing and car
rental business, intercity travel
service, audio accessory and car
décor businesses and many others. These will all absorb many
skilled workers who cannot otherwise find proper job elsewhere.
The same is true for the agro-industry sector where, for instance,
development of an oil palm plantation will lead to creation of various job opportunities down the
line, not to mention revenue generation opportunities resulting
from further development of the
derivatives of palm oil.
The interaction between all
the stakeholders on the produc-
tion chain shall create complementarity to ensure survival of
this sector.
“Other sector shall follow if
these two sectors can be developed well,” the minister says,
adding that with such industrial development strategy, the government hopes to see a greater
number of employment opportunities created henceforth.
As of December last year, according to government statistics, the agriculture sector had
absorbed 41.5 million workers
while the manufacturing sector
employed 13.8 million workers.
The trading sector that stands between these two areas absorbed a
total of 22.5 million workers.
The trading sector is an area
in which many Indonesians even
with low levels of education can
earn a living. In fact, it is here
that most families in urban areas
get their main source of income,
because every single line of the
manufacturing and agro-industry activities ends up here. It also
employs millions of people from
upstream to downstream levels,
from producers to retailers and
even street vendors.
Based on these facts, the government is optimistic about being able to create significant
numbers of new employment opportunities through reinvigoration of manufacturing and agroindustry sectors.
“That’s why we need a driving
force to bolster these two areas
though it means further invest-
“For 2011, our plan is
to accelerate economic
growth that is fair to
all and this shall be
made possible by
implementation of
better management
and synergy between
the central and regional
governments.”
Armmida S. Alisjahbana
Minister of Development Planning
and Chairperson of Bappenas
ment and further provision of infrastructure,” she remarks.
In a related development,
Suryo B. Sulisto, Chairman of
Kadin (the Indonesian Chamber of Commerce and Industry), says that if the government
wants to see industry grow strong
this year, it needs to lower bank
interest rates to an average of 10
percent, otherwise, domestic industries will have difficulty competing against foreign players in
the market.
“The government needs to
have a strong commitment to
lower interest rates below 10 percent this year,” the Kadin chairman says, “because our foreign
competitors have lowered theirs
to below 10 percent, in Japan it is
even zero percent.”
Energy Sector
Suryo emphasizes that for this
year industry players need a lot of
support from the government in
order to realize the dream of elevating industrial sector as the
backbone of the economy.
“According to Kadin’s prediction, our economy can grow by
5.8 to 6.5 percent this year, perhaps even higher, provided that
the investment climate remains
conductive and the government’s
credibility remains intact in the
eyes of international investors,”
he cautions.
One way to do this is to encourage production of gas-fueled cars and this certainly needs
fresh investment in the automotive manufacturing sector. This
policy was made public by Budi
Dharmadi, the Director General for High-Tech Industry at the
Ministry of Industry.
“For this year the government
will emphasize production of gasfueled cars. The ministry is ready
to supply gas-fueled vehicles and
we have received orders from provincial governments as well as the
Ministry of Transportation,” he
says.
Throughout this year, the government will increase by 10 percent the supply of gas to fuel cars
knowing that this is a more economical and environment-friendly option to take.
In line with the official’s explanation, Industry Minister MS
Hidayat says that the government has prepared relevant policy
packages to be implemented this
year. He says that the automotive
This can actually be realized
if the government and Kadin sit
down together to phase out some
of the problems faced by business
players such as the need to reorient development strategy toward
strengthening of high-yielding
manufacturing sector be it in
foodstuff or mining. This shall
sever Indonesia’s heavy reliance
on imports and at the same time
eliminate the tradition of relying
on raw material exports.
In the energy sector, meanwhile, the government is busy this
month socializing the need to use
gas-fed cars to relax the public’s
heavy reliance on gasoline. This
is logical because unlike in the
past when Indonesia was a net oil
exporter being a member of the
Organization of Petroleum Exporting Countries (OPEC), the
country is now a net oil importer, so fuel subsidy is now a source
of headache for the government
whoever the President is.
sector is part of the six priority industrial development categories
to be focused on this year.
The government will encourage the growth of domesticallyproduced components industry,
facilitate development of automobile design industry, and facilitate
development of vehicles that are
environmentally friendly and affordable to domestic buyers.
The government will give various incentives for developing this
sector throughout 2011, the minister promises. Among the incentives is a tax exemption policy
for luxury goods, tax holiday for
capital goods, raw material, and
components needed by locallybased manufacturing industries.
But as the government moves
to discourage the use of subsidized fuel this year, business analysts say that this policy should
not be implemented rigidly, lest it
could cause people to turn to bicycles which need no fuel.
Prihadi chairman of AIPI, the
Indonesian Association of Bicycle Producers, says that fuel subsidy removal is not linked to the
growth of bicycle industry, but it
is not bad for it either, as the bicycle industry is expected to grow
by over 10 percent this year, up
from over six million units sold
last year.
“Whether or not the government will remove fuel subsidy
does not make much difference
to us because the fact is, more
and more people are turning to
bicycles these days, because they
don’t need to buy fuel in order to
ride their bicycles,” he theorizes.
The President Post
C2 January 17, 2011
Economic Review
Government Sets
11 Priority Programs for 2011
By Widya Sanjaya
Photo: www.presidensby.info/Abror
President and his Cabinet ministers have defined
11 priority programs to be implemented this year.
These 11 programs are basically pro-job, pro-poor
and pro-environment in nature.
D
espite being criticized by his political opponents,
President
Susilo Bambang Yudhoyono is optimistic about Indonesia’s chances
of making further progress in
2011.
In an annual address to the nation’s top leaders, including ministers, chiefs of high ranking state
institutions, governors, mayors,
and regents recently, the President said that his optimism was
based on what he defined as four
logical reasons as follows:
First, the momentum for recovery is taking place, like it or not.
Second, Indonesia still has great
potential in terms of its abundant
natural resourcesthat are yet to be
tapped.
Third, Indonesia has by now
learned valuable lessons from local and global economic crises
and thereby knows better how
to manage them in the future.
Fourth, Indonesians are basically optimistic people who always
have ways to overcome problems
no matter how heavy they may
be.
In order to justify his optimism
about the prospects of Indonesia’s
further growth, the President and
his Cabinet ministers have defined 11 priority programs to be
implemented this year. These 11
programs are basically pro-job,
pro-poor and pro-environment
in nature and are summarized as
follows:
layers of society.
Fifth is upgrading of food selfsufficiency. Indonesia used to be
self-sufficient in rice to the extent the United Nations Food
and Agricultural Organization (FAO) bestowed the nation
with an FAO medal of recognition back in 1984. Such is no longer true today as imports of foodstuff have become so common in
response to lack of supply and rising domestic need.
To eradicate poverty, the SBY
government will this year focus
on better distribution of rice for
poor segments of society as well
as promotion of social security
network to embrace a larger portion of the population.
In education, as rightly defined
by Minister Muhammad Nuh,
the government will introduce
a morality-based curriculum in
order to promote good character among students, so that when
they grow up they will become
responsible citizens with good
character and integrity. This will
in turn help reshape the nation’s
character as a whole, says the
minister.
Education observers say if this
had been implemented long time
ago, perhaps Indonesia would not
have seen so many of its scholars
being dumped in jail for corruption and various other forms of
bad conduct.
The sixth priority program
the SBY government is focusing
on this year is provision of transportation infrastructure and better level of passenger safety, be it
on land, at sea, or in the air. Nevertheless, there was no mention
of how to ease traffic jams in the
capital city.
The seventh priority program
this year is improvement of business and investment climate
through streamlining of regulations and promotion of investor
confidence through ensuring legal certainty.
In the sector of healthcare, the
Family Planning program will be
revitalized to involve more young
families which are still in productive age category.
Priority number eight is better
provision of electricity across the
archipelago and diversification of
energy through the launching of
new geo-thermal projects. Indonesia is very rich in this subsector
of energy being a country situated along the equator but geothermal and solar energy utilization
for industry has yet to be popularized.
First is the program to thoroughly implement bureaucratic
and management reform. “I want
all of you to move forward in implementing reform,” the President emphasized.
The 9th priority program is replanting forests that have been
denuded for industrial purposes. Also important is reclamation
of mangroves along coastal areas
in order to create a better eco-system to support economic activities.
Second is upgrading the quality of education as only through
better education can Indonesia
have the ability to produce better
quality human resources to run
the economy.
The government’s priority
number 10 this year is promotion
of coordination between the rich
and poor regions including outerlying regions bordering neighboring countries.
Third is upgrading of healthcare services including better provisions of medicine for people at
large.
The last priority program to
be implemented this year is promotion and preservation of arts
and local cultures in an effort to
maintain national identity and
promote a national sense of belonging especially among the
younger generation.
Fourth is reduction of poverty through concrete programs directly aimed at the most fragile
The government will this year
put much emphasis on disaster
management and intensification
of rehabilitation programs. Also
on the agenda are action plans for
handling climate change in order
to ensure sustainable living environment that is conducive to further economic growth.
President Yudhoyono is optimistic about Indonesia’s chances of making further progress in 2011. The
President said that In an annual address to the nation’s top leaders, including ministers, chiefs of high ranking
state institutions, governors, mayors, and regents recently.
Especially in the sector of people’s welfare, the government has
also underscored its programs
in order to ensure satisfactory results. This comes under the
auspices of nine ministries being supervised by Coordinating
Minister Agung Laksono.
The ministers involved are
Minister for Environment Gusti
Muhammad Hatta, Minister for
Social Affairs Salim Segaf Al Juprie, Minister of Education Prof
Muhammad Nuh, Minister for
Culture and Tourism Jero Wacik,
Minister of Health Endang Rahayu Sedyaningsih, Minister for
Empowerment of Women and
Child Protection Linda Gumelar, Minister of Public Housing Suharso Monoarfa, Minister
of Sport and Youth Andi Mallarangeng, and Minister of Reli-
gious Affairs Suryadharma Ali.
These ministers have produced
a priority agenda to promote social welfare throughout 2011,
covering five areas namely education, healthcare, poverty eradication, preservation of the environment, disaster management and
promotion of cult ure, as well as
promotion of creativity and technology innovation.
This FP program has not produced a very satisfactory result
because despite intensive campaigns in the past, population
growth still can’t be controlled
in the way the government wants
to see. Rapid population growth
brings along heavier economic burden to every family and
worse, contraception being used
in FP programs are being misused for the wrong purposes.
For instance, under Family
Planning program the government encouraged families to use
contraceptives in order to prevent pregnancy but later people
used condoms for free sex. This
is an unwanted byproduct that is
a nuisance to both the education
and religious affairs ministers.
Perhaps the most cumbersome
issue for the government is the
negative impact of rising commodity prices on many families
across the country. Despite the
President’s claim that Indonesia’s
per capita income has risen to
US$3,000, and the economy has
grown markedly in statistical figures, pressure on families has not
come down these days.
Economic observers
say that in all
fairness, President
SBY performed
quite well last year
as was evident in
overall economic
performance; and
this year he appears
to be a lot more
serious in “whipping”
state apparatus to
perform better. One
simple example was
evident recently
when the president
reprimanded
government officials
who fell asleep or
play with their mobile
phones while listening
to his speech.
This could have been the reason why former President Megawati Soekarnoputri recently
urged the government to correct
its social-economic policies in order to raise people’s standards of
living.
For President SBY, somehow, it
is not easy to translate ideas into
reality unless all components of
national leadership from the capital city down to regency level
work hand in hand with a common vision that is sincere promotion of people’s living standards.
Economic observers say that
in all fairness, President SBY performed quite well last year as was
evident in overall economic performance; and this year he appears to be a lot more serious in
“whipping” state apparatus to
perform better. One simple example was evident recently when
the president reprimanded government officials who fell asleep
or play with their mobile phones
while listening to his speech.
“It is not good for people
around the country to see you fall
asleep on television, or play with
your mobile phone! Anybody doing this should leave this hall,”
the President said, bringing the
rather noisy hall to total silence,
as some in the audience guiltily put their devices back onto the
table and began to pay attention.
The President Post
January 17, 2011 C3
Economic Review
National Economic Commission:
Investment to Grow 13.4% in 2011
By Widya Sanjaya
Photo: www.inilah.com
Meanwhile, the President also expects world
oil prices to stabilize around US$80 per barrel
with Indonesia’s output level of 970,000 barrel
per day. A higher world oil price would not
be conducive to Indonesia’s national budget
because the country is now a net-oil importer.
T
o amplify President
Susilo
Bambang
Yudhoyono’s optimism over Indonesia’s 2011 economic outlook, Komite
Ekonomi Nasional (KEN) or the
National Economic Commission has said that investment will
grow by at least 13.4 percent this
year, thanks to sustained political
stability and increasingly positive
macro-economic indicators.
Even as early as August 2010,
President Yudhoyono had said
he expected national economy to
grow 6.3% in 2011 under which
inflation will remain checked at
5.3%, Bank Indonesia’s threemonth benchmark SBI rate to
float at 6.5% and national currency rupiah to stabilize around
Rp9,300 per US dollar.
Meanwhile, the President also
expects world oil prices to stabilize around US$80 per barrel
with Indonesia’s output level of
970,000 barrel per day. A higher world oil price would not be
conducive to Indonesia’s national budget because the country is
now a net-oil importer.
Due to this, every time world
oil prices increase by an average
of one US dollar above the ceiling stipulated in state budget, the
government reportedly incurs additional subsidy worth Rp2.67
trillion.
If the macro-economic situation develops favorably in this
direction, there is good reason
for the government to see sound
growth in investment during
2011 as was rightly predicted at
the start of this year by the National Economic Commission.
The Commission says though
the year 2010 only saw investments grow by an average span
of 7-9%, this year will see investment soar to 13.4% due to greater
investor confidence and better domestic business climate—though
the growth will be gradual in nature.
The Commission also predicts
that uncertainty on global economic map will somehow decline, causing greater optimism
for foreign and domestic investors to either expand their operations or open new ventures in Indonesia.
In terms of portfolio investment, the Indonesian Stock Exchange (ISE) has in recent years
performed so well that there is
now a bigger number of foreign
and domestic investors pouring
their funds into it.
The ISE was even rated as the
best capital market in this region during 2010 given its rapid growth and stability. This has
propelled Indonesia’s investment
reputation to a higher plateau and
the country is now approaching a
global investment grade.
Rp124.6 Trillion for Industry
Growth
For Indonesia to reach such
lofty goal, the industry sector
needs fresh investments totaling
Rp124.6 trillion during 2011, according to Industry Minister MS
Hidayat. With that, the industry sector is expected to grow 5.66.1% requiring a big chunk of investment funds going into the
non-oil-and-gas processing subsector.
Such magnitude of industrial growth will generate employment for almost 15 million workers, the minister says, apparently
because this includes investments
in labor-intensive real sector projects.
Minister Hidayat also predicts
positive growth in the export of
non-oil-and-gas industrial products during 2011. He expects this
category of export to generate at
least US$92.26 billion in revenue
this year.
The minister says the government will focus on six priority areas, namely labor-intensive, small
and medium-scale industries,
capital goods, natural resource
based, high-growth, and special
priority industries.
His optimism about 2011 investment prospect is based on
the fact that in 2010 investment
realization far exceeded 4.65%,
the target set by the government
at the start of last year. That itself was an impressive growth
from 2009 performance of only
1.54%.
The industry minister explains that means of transportation, machinery, and industrial
equipment experienced the highest growth of 8.47%, followed by
fertilizer industry, chemical, and
rubber-based products which
grew 4.82%, whereas the growth
of other manufactured goods was
3.83% during 2010.
However, the biggest contributor to national industry growth
was food and beverages plus cigarette products which made a total
of 34.35% growth, while means
of transportation, machinery and
equipment made 28.13%, fertilizers registered 12.44%, textile,
leather-based products and footwear contributed 8.71% while
wooden and forestry products
contributed 5.75% to national
industry growth.
Of the many industrial
sub-sectors attracting
foreign investors, one
is worth mentioning
for its unique nature:
shrimp culture. There
was good news at
the start of this year
that investors from
mainland China were
planning to invest up
to 10 billion RMB to
boost shrimp culture
projects in Indonesia.
Shrimp Farming Investment
Of the many industrial subsectors attracting foreign investors, one is worth mentioning for
its unique nature: shrimp culture.
There was good news at the start
of this year that investors from
mainland China were planning
to invest up to 10 billion RMB to
boost shrimp culture projects in
Indonesia.
News reports say that investors from Guolian in Zhanjiang,
wanted to revitalize a shrimp
project in West Nusa Tenggara
and a similar project in Kendal,
Central Java.
The fund is said to have remained idle in China for some
time and therefore they want to
use it to upgrade shrimp projects
in those two Indonesian provinces, according to Martani Huseini, the director general for processing and marketing of fishery
products at the Ministry of Maritime and Fishery.
Guolian has China’s largest
integrated shrimp culture center with an annual production
capacity of 1.2 million tons. Indonesia, on the contrary, has
not even been able to produce
350,000 tons of shrimp per year,
he says.
The government is hoping that
Chinese investors will come with
worthwhile path to pursue.
Another source of optimism
is the floating of an even bigger number of market derivatives which allow investors from
all levels to participate in the
business theater. Many companies, big and small, have benefited from the robust climate due to
which they can expand business
without relying on bank loans.
Chairman of National Economic Commission Chairul Tanjung. Komite Ekonomi Nasional (KEN) or the National Economic Commission has said that
investment will grow by at least 13.4 percent this year, thanks to sustained political stability and increasingly positive macro-economic indicators.
transferable technology that will
bolster domestic shrimp production and teach Indonesians to develop by-products of the commodity for export. A delegation
from China will visit Indonesia
in late February this year to finalize the investment plan.
Ironically, the Chinese are increasing investment in Indonesia’s shrimp farming sector soon
after three local companies have
gone bankrupt laying off more
than 6,000 workers, not to mention 13 other such companies
which reduced their output due
to difficulties in marketing.
Thomas Darmawan, chairman
of the Association of Indonesia’s
Fishery Processing and Marketing Companies, says that a total
of 16 shrimp farming companies
reduced their output from 2008
to 2010 and three of them were
closed down. Today there are 133
such companies still in operation.
He blames lack of supply of raw
material for the decline in shrimp
output which exacerbates marketing woes.
Investment in Energy and
Mines
Investment in this sector will
pick up this year as there are many
foreign players wishing to step in
if only the government eases regulations to facilitate business.
Hariara Tambunan, chairman of the energy development
commission of the Indonesian
Chamber of Commerce and Industry (Kadin), says that the government needs to ease regulations
in order to facilitate the entry of
more foreign investors in this sector especially for coal business.
He says Indonesia does not
have a good supply of coal so the
government should explain what
it plans to do during 2011 to
overcome the shortage. The irony, he says, is that this country is
very rich in coal and it does not
have enough supply!
This shortage is caused by the
government’s slow response to the
rising need, he argues. With more
than 70 billion tons of coal, Indonesia has Asia’s largest coal deposit yet to be brought to surface.
Another annoying issue is the
arduous bureaucracy in licensing
process which causes uncertainty
and lack of investor confidence.
The daily Rakyat Merdeka once
accused Energy and Mines Minister Darwin Saleh of being “too
slow a mover”, undermining the
sector’s performance and disappointing potential investors.
The newspaper says that his
slowness was the reason why Japanese Energy Minister Hiroyuki
Ishige and Nigeria’s veteran Energy Minister Rilwanu Lukman
cancelled their plans to meet him
some time ago.
Likewise, Senior Vice President
for Asia Pacific of Total E&P Indonesia, Jean Marie Guillermo,
had to cool his feet for hours before being allowed to see the minister.
Nevertheless, many officials at
his ministry say the minister has
performed well so far and is doing better this year.
“In terms of success rate, it is
unethical for us to evaluate ourselves; let others do so,” says the
minister’s special assistant, Kardaya Wardika.
Portfolio Investment
A better barometer for evaluating Indonesia’s investment prospect this year is the performance
of the Indonesian capital market.
The market’s composite index
has in recent years soared steadily in rhythm with rising market capitalization mainly involv-
ing foreign investors holding for
a long time the bullish industry
stocks.
The number of share issuers has
continued to grow in line with
steadily rising number of corporations floating stocks, causing even greater optimism that
portfolio investment is indeed a
In terms of investment participation, the market has now seen
new generation of investors, especially young executives which
comprise a significant portion of
the middle class.
In rhythm with rapid expansion of the middle class, the size
of local investors’ participation in
the capital market will also become bigger and bigger in the
years ahead.
So vigorous is the investment
climate that President Susilo Bambang Yudhoyono has
deemed it necessary to open the
ISE trading himself in early January, which drew enthusiastic response from international investors.
Market analysts say that now
is the best time to enlarge investment participation in the Indonesian capital market. This bullish
period will last until 2013 when
domestic political temperature
will start rising ahead of Indonesia’s presidential election.
The President Post
C4 January 17, 2011
Tourism
Yogyakarta Tourism Regains Vibrancy
Post Merapi Eruptions
The recent volcanic eruptions of Mount Merapi
not only claimed more than a hundred lives but
also displaced tens of thousands of people
who lived on the slopes of the mountain. Aside
from causing property damages, the volcanic
eruptions had also brought Yogyakarta’s vibrant
tourism sector to a temporary halt.
M
ount
Merapi, which first
erupted on October 26, 2010
and went on
for about three
weeks, had significantly caused
substantial losses on the local
tourism sector, hurting hotels
and restaurants as tourists decided to put their trips to the region
on hold.
“Losses on the tourism sector
grew further after Transportation Ministry’s Directorate General of Civil Aviation decided to
temporarily close Adisutjipto International Airport, Yogyakarta,”
said Yogyakarta Tourism Promotion Board Chairman Deddy
Pranowo.
It is time for Yogyakarta tourism sector to revive and get back
on its feet now that the eruptions
have subsided to avoid a protracted decline.
Indonesia Hotels and Restaurants Association Chairperson
Yanti Sukamdani Hardjoprakoso said the image of Yogyakarta’s
tourism industry should be restored immediately.
Yogyakarta is the second most
favorite tourism destination in
Indonesia after Bali and therefore the tourism sector should
not be left in limbo for too long,
she said.
She said hotel occupancy rate
in Yogyakarta had dropped to
20% due to the eruptions. The
condition was further aggravated
by news from media that scared
off tourists.
Embrace media to promote
tourism
Efforts to revive Yogyakarta’s
tourism industry were conducted by all elements in the region
through various ways. All these
efforts were aimed to bring back
tourists, both domestic and foreign.
One of the efforts to restore
Yogyakarta’s tourism image was
by embracing the media, both
domestic and international media houses.
“To restore image of Yogyakarta’s tourism industry after the
Mount Merapi eruptions, we had
to embrace the media, both international and national,” said Association of the Indonesia Tours
and Travel (Asita) Chairman Edwin Ismedi Himna.
BOROBUDUR
After being closed down
due to the volcanic ash
from the Mount Merapi
eruption, Borobudur is now
ready to welcome visitors.
The Borobudur temple was
built around the 8th century
by the Syailendra Dynasty.
About 2000 tourists both
international and domestic
visit Borobudur every day.
Asita Yogyakarta also tried to
convince committees of national
and international events to bring
back their events to Yogyakarta which were canceled or transferred to other cities.
Meanwhile, a ceremony was
held to welcome the first arrival
of international passengers when
the Adisutjipto Yogyakarta International Airport was reopened.
The welcome ceremony included the handing out of batik
scarves to passengers who disembarked from the plane that flew
from Singapore.
ists had asked, either via email
or phone, about Yogyakarta and
we provided them with the latest
situation here,” said Yogyakarta
Tourism Agency Tazbir.
He explained that Mount
Merapi is still active but the danger zone had been reduced to respectively 10 kilometers and 15
kilometers from the summit for
west Kali Boyong and east Kali
Boyong.
According to him, Yogyakarta is safe because it is located 40
km away from Mount Merapi’s
summit.
Yogyakarta is Safe to Visit
A number of tourism attractions including Ngayogyakarta
Hadiningrat, Prambanan Temple, Borobudur Temple, Taman
Sari, Malioboro and others are
Tourist attractions in Yogyakarta have been reopened and are
safe to visit.
“After the eruptions, tour-
Sastro Al Ngatawi,
Head of Lesbumi,
organizer of
“Borobudur Recovery
Art”, said the volcanic
eruptions were a test
but that it should
not demoralize the
society. “The people
should bounce back
and recover from their
sufferings,” he said.
situated outside the danger zone
and are therefore safe for tourists
to visit.
“Social activities in Yogyakarta have returned to normal and
Yogyakarta is ready to welcome
tourists once again, “said Tazbir.
“Borobudur Recovery Art
“, Part of Efforts to Restore
Tourism
An event called “Borobudur
Recovery Art” was held in the
parking lot of Borobudur Temple, Magelang, Central Java, recently. The event was part of the
efforts to restore the tourism industry after the Merapi volcanic
eruptions.
“This activity was an attempt
to convince the public and the
tourism world that Borobudur
temple is a safe place to visit,” said
Central Java Disaster Mitigation
Agency Logistics and Equipment
Chairman Putu Adi Sutrisno in
Magelang.
“Other tourism supporting industries that are hit by the volcanic eruptions are travel agencies,
restaurants, hotels and souvenir
vendors,” he said.
He added now that the volcanic activities have subsided and
the government has lowered
Merapi’s alert status, it is time for
the real sector and art and culture
sectors to revive.
Sastro Al Ngatawi, Head of
Lesbumi, organizer of “Borobudur Recovery Art”, said the volcanic eruptions were a test but that
it should not demoralize the soci-
ety. “The people should bounce
back and recover from their sufferings,” he said.
He added that aside from organizing a cultural event and art
performances, Borobudur Recovery Art also promoted tree planting activities in Kenalan Village,
subdistrict of Borobudur.
“Planting trees could serve as
reforestation and efforts to prevent erosions in the future,” he
explained.
Foreign tourists who visited
the Borobudur temple during
the cultural event were also welcomed with garlands which were
handed out gracefully by dancers. A mass prayer led by interfaith leaders was also conducted.
The President Post
January 17, 2011 C5
Pictorial Events
Bakrie Micro Credit
without Collateral
PT Bakrie Microfinance Indonesia (BMF) launched microcredits
which are mainly for women. BMF is a charity program and
adopts the concept and philosophy of Grameen Bank, a
microfinance bank in Bangladesh founded by 2006 Nobel Prize
Winner Muhammad Yunus.
BMF officially started to operate in Desa Kalangsari, Karawang,
Jawa Barat.
Text & Photos by Nandi Nanti
The Financial Club Breakfast Dialogue
The Financial Club held the regular Breakfast Dialogue themed
“Management in the New Economy” last December, featuring
Sutanto Hartono the President Director of PT. Microsoft Indonesia.
Text & Photos by Nandi Nanti
Schenker New Sales Office
at Cikarang
Text & Photo by Nandi Nanti
Indonesia Australia
Business Council
IABC held a gathering participated by businessmen and professionals, among others
Nick Fenton from Nusa Prima Persada International Consulting, Jeff Tutticci – Aurecon,
Catherine Eddy from Nielsen Indonesia, Malcolm Llewellyn from Boral Indonesia,
Robert Lemmey from Triangle Pase Inc., Terry Moore from JDA, Indonesia, Steve
Young from Siemens Indonesia, and Ms. Rizka An Nisa from Benchmark Recruitment.
PT. Schenker Petrolog Utama opened its sales office at Cikarang, Jababeka.
President Director of DB Schenker Hauns Hauptmann attended the event.
The New Country Head
and CEO of HSBC
EMO HANNOVER 2011
Michael Young has been appointed
the new Country Head and CEO
of The Hongkong and Shanghai
Banking Corporation Limited
in Indonesia. Currently Deputy
Chief Executive Officer and Chief
Technology and Services Officer
for HSBC Turkey, he will succeed
Rakesh Bhatia, who will move to
Hong Kong as Global Head of
Trade and Supply Chain.
Emo Hannover 2011, the machine industry exhibition, will be held at
Hannover Germany, 19-24 September 2011. The press conference was held
at Jakarta and attended by Jan Roennfeld from Ekonid, Martin Thiem from
Deutsche Messe AG and Christop Miller from Emo Hannover.
The President Post
C6 January 17, 2011
Living
The 10 most significant
gadgets of 2010
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com
If you’d told us in December 2009 that we’d be using the word “iPad”
every day without giggling, well, we would have giggled at you. But there
it is: There’s no getting around the fact that the iPad, silly name and all, has
completely and successfully redefined what a “tablet computer” could be.
Kindle 3
With a brighter, higher-contrast screen and a svelte, understated design, Amazon has finally nailed the Kindle. There’s still
room to debate the virtues of E
Ink (long battery life, paperlike
readability) versus LCD screens,
but on balance, if it’s reading
you’ll be doing, the Kindle is
tops.
Canon S95
You might be thinking,
“What’s a point-and-shoot doing on a top-10 list?” That’s how
good Canon’s PowerShot S95 is:
It’s a camera that gives amateur
shooters pro-baller status.
This pocketable cam packs
a 10-megapixel sensor, a 9.5mm (diagonal) sensor, the latest DIGIC 4 processor (which is
lightning fast), optical image stabilizer, face detection, the ability to shoot RAW images and
HDMI output.
Samsung Galaxy Tab
The first Android-based tablet to be a credible contender to
the iPad, the Galaxy Tab is a remarkably usable tablet that’s got
a lot going for it. It’s considerably smaller than the iPad, with a
7-inch diagonal screen compared
to the iPad’s 9.7 inches. But with
an almost identical 1024 x 600
pixel resolution, it’s
got just as much
screen real estate
-- and it’s a good
deal more portable.
MacBook Air
Steve
Jobs
called the new
MacBook Air
the future of
computers, and
we like where
this is going.
Coming in 11and 13-inch flavors, the MacBook Air weighs
less than 2.5
pounds, with
a wedge shape
that thins down
www.thekindlechronicles.com
to just a tenth-ofan-inch.
Most importantly, it ships with
a flash drive, which makes the
Air a surprisingly zippy performer for its size. And at an attractive starting price of $1,000, who
wouldn’t consider one of these as
their next notebook?
iPhone 4
Reviewers sang praise for the
device’s gorgeous “retina” display, which makes reading from
a digital screen as pleasing as a
glossy magazine page. Add to
that a front-facing camera for video chat, a fast A4 processor and
iOS 4, which enables multitasking, and the iPhone 4 is a killer
upgrade.
iPhone 4 was Apple’s hottest
iPhone yet, selling 14 million
units in just one quarter.
Sprint Evo 4G
It’s bigger, beefier and more
badass than almost any other
phone we’ve tested this year. And
thanks to its 4G connection,
4-inch screen and ability to beam
out a Wi-Fi signal, the Sprint
Evo makes an excellent traveling
companion.
Windows Phone 7 on
Samsung Focus
In the wake of the iPhone revolution, Microsoft’s Windows Mobile OS tanked in market share,
and the software giant decided
in 2008 to scrap everything and
start over.
Based on a fresh tile-based interface, Windows Phone 7 is an
impressive start. It shines brightly on the lightweight Samsung
Focus smartphone, which has a
beautiful AMOLED screen and
a solid overall construction.
Air Rage: Is Reclining
Your Seat a Right?
If you’re the passenger who feels uncomfortable when someone
in front of you puts their seat back, you can ask whether they plan
on being reclined for the whole flight, in which case you might
start looking for a different seat
The passenger in
seat 9C was ready for a
nap after takeoff, so he
pushed the button on his
armrest and reclined –
straight into the path of
someone who apparently
wouldn’t have it.
Tensions grew quickly
on the American Airlines
flight from Los Angeles
to Denver on November
22, court papers show.
The incident adds fuel
to a debate that seems to
divide air travelers into
two camps: those who
say that reclining their
seat on a plane is a right
that comes when they
buy a ticket and those
who believe it’s a privilege that shouldn’t be
abused.
As Brian Dougal
leaned back on the Denver-bound flight late last
month, he felt someone bump
his seat, according to a criminal
complaint filed in the U.S. District Court of Colorado.
“Are you serious? My knees are
up against the seat,” said the man
behind him, identified as Tomislav Zelenovic, according to the
complaint.
Dougal suggested that Zelenovic also recline, slide into an
empty seat next to him or move
his legs to the side. Dougal told
the man in 10C that he paid for
his seat and was going to recline
it.
ply hate it when the person in front of me shifts
their seat as far back as it
will go,” Collins recently vented in a blog entry
titled “Ban the reclining
seat on planes.”
“I regard the invasion
of the person’s space sitting behind me as an
unfortunate, but easily
tolerated, side-effect of
my attempt to achieve
a modicum of comfort
while flying,” wrote travel guru Arthur Frommer
in his blog this year.
So, is reclining your
seat on a plane a privilege or a right?
Neither, said Lizzie
Post, etiquette expert,
author and spokeswoman for the Emily Post Institute.
Photo: www.bing.com
“It’s not a right; it’s not
a privilege; it’s a function
Zelenovic then shook the back of the seat that you purchase,”
of Dougal’s seat and grabbed his Post said.
right ear, pulling it back and down
If you want to recline your
with enough force to knock Dougal’s glasses off his face, accord- seat, there is no obligation to
ing to the complaint.
turn around and assess whether
the person behind you would be
Steve Collins, an Australian cramped, Post said.
broadcaster who runs the blog
If you’re the passenger who
Grumpy’s Getaway Guide, ar- feels uncomfortable when somegues that he shouldn’t have to put one in front of you puts their seat
up with passengers who lean back back, you can ask whether they
and invade his personal space.
plan on being reclined for the
“I don’t recline my seat, pri- whole flight, in which case you
marily because I have respect for might start looking for a different
the person behind me, and I sim- seat, she advised. (CNN)
www.dvice.com
Here, then, are the 10 gadgets that were most significant in 2010.
Microsoft Kinect
Combining a visible-spectrum
camera and an infrared sensor,
the Kinect offers the most advanced real-time 3-D scanning
and rendering we’ve seen in a
commercial product. It’s also got
built-in face recognition. The upshot: Your Kinect can recognize
you, and you can control it simply by waving your hands and
moving your body.
Berkeley Bionics eLEGS
The feel-good gadget story of
the year, without a doubt, was
a lightweight exoskeleton from
Berkeley Bionics that can help
paraplegics walk again.
At the company’s press confer-
www.t
ech2
.in.co
m
ence, a person who’d been paraplegic for 18 years demonstrated
the eLEGS by walking around
onstage.
www.dpreview.com
iPad
The tablet’s beautiful 9.7-inch
screen opens new possibilities for
content creators to make money
by selling apps through the App
Store, but every so often Apple
cracks the whip, demanding programmers to follow the company’s vaguely stated but stringently
applied rules.
Apple sold 4.2 million iPads
during the tablet’s first quarter
of existence, claiming the title of
fastest-adopted gadget in history.
(WIRED)
www.hitechreview.com
The President Post
January 17, 2011 C7
Living
The Future of Cars:
Drivers Not Needed
It’s conventional wisdom in the auto industry, but
the rest of us may be a bit shocked to find out that
cars of the future likely will drive themselves.
In some ways, they already are.
A
$100,000 car from
Mercedes aims to
give the human
foot a rest in traffic jams. It senses
how far away other
cars are – and then speeds up and
slows down accordingly. No need
to turn off cruise control and hit
the brake. You just steer. (Wired
Magazine, which tested the car,
called this a “magically scary experience.”)
And tech companies are pushing car automation even further.
In October, Google announced it had developed a fleet
of cars that use various sensors
and maps to feel out the roadway. “They’ve driven down Lombard Street, crossed the Golden
Gate bridge, navigated the Pacific Coast Highway, and even
made it all the way around Lake
Tahoe. All in all, our self-driving
cars have logged over 140,000
miles. We think this is a first in
robotics research,” the company
said on its blog.
The latest edition in this trend
comes from General Motors,
which showed off a self-driving
car last week at the Consumer
Electronics Show in Las Vegas.
The EN-V (pronounced “envy”
and short for “Electric Networked Vehicle”) combines two
ideas about how to teach cars to
drive – using sensors like cameras and sonar to keep the car from
hitting pedestrians; and network
technology that lets cars talk to
each other.
This “car internet” lets the cars
link up wirelessly and follow one
another in a sort of wirelessly
linked train. If one EN-V needed
to pull out of the line, it could.
The pod-like cars, which are
just prototypes for now (GM says
they could be on the market by
2030 at a cost of $10,000), look
somewhat like large scuba-diver
helmets, or smushed dust busters.
They roll on two wheels, which
are aligned like the front two
wheels of a car, not like a bicycle. GM partnered with Segway,
maker of those futuristic-looking
transporters, to create technology
that allows the car to balance.
“It’s basically a dynamically balanced skateboard,” said
Chris Borroni-Bird, GM’s direc-
tor of advanced technology vehicle concepts.
The EN-Vs are just as wide
as they are tall, measuring 5
feet cubed. Two people fit inside comfortably, but there’s
not much room for anything
else. A bubble of glass sits close
in front of the driver’s face. “You
can probably pack 5 or 6 times as
many of these EN-Vs in a parking lot as you could conventional
cars,” Borroni-Bird said.
Even though the cars can communicate with each other and
drive themselves, drivers can take
control if they choose. That’s important, Borroni-Bird said, both
for safety reasons and so drivers
can get some sense of enjoyment
from the vehicle.
3-D isn’t going away – Disappointing sales of TVs have not deterred
technology and media companies
from pursuing 3-D products.
We saw 3-D TVs, laptops, cameras, movies, games, portable devices
and picture frames.
Three-dimensional TVs were a
huge theme at last year’s CES, too,
although cost, shortage of 3-D content and those bulky special glasses
made consumers wary. This year,
we saw big steps in 3-D big-screen
viewing without glasses, though little
in the way of solidified products.
But in case the home 3-D craze
falls completely flat, television makers are betting another trend may
help them sell new TV sets or accessories. We saw all kinds of “smart
TV” systems that connect the big
screen to the content of the Web.
Following the blazing success of
Apple’s iPad, practically every manufacturer with any kind of expertise in
building screens, gadgets or software unveiled their own touchscreen
tablets at CES.
Mobile industry watchers expect
Google to repeat its success with
the Android operating system for
smartphones in the tablet category
as well. The company demoed Honeycomb, its new Android 3.0 operating system for tablets, at CES to
good reviews.
More than just fun and games
at CES One prototype Honeycomb
tablet, Motorola’s Xoom for Verizon
Wireless, got perhaps the biggest
buzz. LG Electronics offered the GSlate for T-Mobile, which also runs
Honeycomb, but the company had
nothing to show at CES besides a
video.
There were dozens of other tablets
running older versions of Android or
a tablet-optimized version of Microsoft’s Windows 7 operating system.
Or, in Lenovo’s case, both.
One disappointing trend, from
a tech reporter’s perspective, was
the companies’ reluctance to let
the public handle tablets in person.
Many devices were waved about on
stage or displayed behind glass but
not made available for show attendees to play with.
Celebs are great for hawking gadgets – What better way to promote
an otherwise dull piece of equipment
than with a familiar face?
Rapper Ludacris was in town to
promote his upcoming line of headphones. Fellow musician T-Pain
was hawking a microphone. And
49ers football legend Jerry Rice
was scheduled to attend CES – but
bailed days before – to promote a
video game where his character
competes against dogs. (No, that’s
not a joke.)
Lady Gaga, the official creative director for Polaroid (also not a joke),
arrived about 40 minutes fashionably
late to her event at the camera company’s booth.
The pop star demonstrated a
portable photo printer she said she
designed herself, which she carries
in her purse, and a bulky pair of sunglasses with a camera built in. Gaga
encouraged the audience to buy the
sunglasses and bring them to her
concerts.
If Polaroid wanted to make a
splash, it worked: Gaga’s appearance produced a massive crowd,
swarms of paparazzi and countless
headlines. Whether anyone will actually buy the sunglasses is another
matter.
Gimmicky things can get buzz-Acer’s Iconia, a laptop with two
touch-screens instead of a keyboard, won a gadget competition
despite not demonstrating a working
version of the product onstage.
The Iconia appears to face some
Here are three things you should never buy
unless you’re rich enough to stop working:
Timeshares
It never makes sense to buy a timeshare, even if you
vacation in the same place every year. Timeshare sellers
will tell you that the rooms are bigger than those in a hotel,
and come with more amenities. What they don’t tell you is
that the glut of timeshares has made it easy to rent one at
a fraction of the cost of buying one.
You could rent a timeshare every year for the next decade and spend less than you would if you had you bought
it. And you wouldn’t be stuck with maintenance fees.
Boats
The EN-V (Electric Networked Vehicle) by General Motors
Drivers use a joystick of sorts
to steer and throttle the vehicle,
which can spin in place and accelerates rather quickly.
Still, Borroni-Bird says, there
are a number of obstacles that
need to be hurdled before something like the EN-V hits the market.
The wireless signals that let the
vehicles communicate are problematic because hackers, in theory, could access them and send
The Consumer Electronics Show, a showcase of cutting-edge gadgets,
took over the Las Vegas Convention Center last week.
of challenges. It has the heft of a laptop without the convenience of being able to type on physical keys.
Chinese computer maker Lenovo
got some attention for its laptop hybrid with a removable touchscreen
tablet – despite the fact that the
company showed off basically the
identical gadget at CES 2010.
And several companies introduced home appliances – refrigerators, ovens and washing machines
– with internet connections and
touchscreens. Your oven, for example, can send you a text message
when your roast is about done.
Of course, declaring something
a gimmick before it’s had ample
time to be accepted or rejected by
consumers is probably not fair. Who
knows? Maybe people will really
want to tweet from their fridge.
Gadget ‘Transformers’ – Sometimes being a really good phone,
laptop or Web-connected entertainment center isn’t enough. Take Motorola’s Atrix 4G , for example. It’s all
three.
The Android smartphone is superfast, with a dual-core processor inside. But like in the hit “Transformers” movie, the big reveal comes
when this truck becomes Optimus
Prime.
The Atrix can dock to a laptop
shell or monitor to become a sort
of Android desktop computer, complete with Firefox for full Web browsing. Hook it up to a TV, and the videos and music stored on the device
can be played on the big screen using a media-center system.
Samsung’s Sliding PC 7 Series
laptop starts out as a touch-screen
Windows tablet. But users can pull
out a hidden keyboard, similar to the
ones on slider phones, which turns
the tablet into a sort of netbook.
(CNN)
3 Expensive
Things You
Shouldn’t Buy
Many people’s financial troubles begin
when they buy an expensive toy or a
vacation home. The buyers assume they’ll
save money because they’ll own the items
instead of renting them. While that might be
true short-term, it rarely works out that way
in the long run.
The EN-V runs on battery
power and plugs into a wall –
giving it a max speed of about
30 miles per hour and a range of
about 30 miles. That’s not far or
fast, but it’s enough to make the
EN-V useful for cutting down
congestion in urban settings,
particularly high-density cities
in China and India, BorroniBird said.
The car also aims to improve
safety, since human drivers
don’t have a sterling record on
that front. An estimated 1.3
million people die in trafficrelated accidents each year, according to the World Health
Organization.
The Things We
Learned at CES
After tapping dozens of greasy
touchscreens, getting our ears
pinched by 3-D glasses and
braving crowds that would make
a penguin claustrophobic, we
members of the tech media said
goodbye Sunday to the Consumer Electronics Show.
While the planet’s biggest
technology
companies
box
up their prototypes and disassemble their grandiose booth
displays, we’re reflecting on the
past week and what it could
mean for the year ahead.
Here are the things we learned
at CES:
Photo: www.gagagadget.com
cars off track; and because a lost
wireless connection could cause
the automated system to lose control of the car.
“It’s one thing if a computer
goes down, but it’s another thing
if it happens here,” he said.
But he sees a bright future for
the concept.
“For the last 100 years the car
really hasn’t changed in a fundamental sense,” he said.
Self-driving cars may buck that
trend. (CNN)
There’s an old saying that the two happiest days for
boat owners are when they buy the boat and when they
get rid of it. Boats are a great way to throw money down
the toilet because they cost so much to maintain. There
are repairs, docking fees, gas and insurance. You could
rent a much nicer boat on the days you want to spend at
sea for much less than buying one.
Recreational vehicles
Some people think vacationing in an RV will be cheaper
than staying in a hotel room, but that’s only true if you’re
retired and live in the RV. If you buy a modest vehicle for
$50,000 and use it 30 nights a year for 10 years, you’ll
have spent $167 a night. That can get you a nice room in
most places in the U.S. That doesn’t include the costs to
fuel, store and insure it.
If you want to take a trip in a RV, rent one. You could
also spend less by staying in a four-star hotel.
The President Post
C8 January 17, 2011
Health
WAYS
TO NEVER GET
DIABETES
These simple steps may be all it takes to stay healthy and stop worrying about sugar problems.
These are just a few of the good-for-you habits that can reverse prediabetes and ensure you
never get the real thing, which can mean a lifetime of drugs and blood sugar monitoring, an
increased risk of heart disease, Alzheimer’s disease, and other scary health threats.
ber are overshadowed by the addition of refined grains, added
sugar, or cholesterol-raising fats.
5
www.trainbodyandmind.com
1
Nudge the Scale
Shedding even 10 pounds
can significantly slash your
risk.
Even extremely overweight
people were 70% less likely to develop diabetes when they lost just
5% of their weight—even if they
didn’t exercise. If you weigh 175
pounds, that’s a little less than 9
pounds! Use our calorie calculator to see how many calories you
consume—and how many you
need to shave off your diet—if
you want to lose a little.
2
Pick the Right
Appetizer
Eating greens with a vinaigrette before a starchy entrée may
help control your blood sugar levels.
In an Arizona State University study, people with type 2 diabetes or a precursor condition
called insulin resistance had lower blood sugar levels if they consumed about 2 tablespoons of
vinegar just before a high-carb
meal. “Vinegar contains acetic
acid, which may inactivate certain starch-digesting enzymes,
slowing carbohydrate digestion,”
says lead researcher Carol Johnston, PhD. In fact, vinegar’s effects may be similar to those of
the blood sugar—lowering medication acarbose (Precose).
3
Ditch Your Car
Walk as much as you can
every day. You’ll be healthier—even if you don’t lose any
weight
People in a Finnish study who
exercised the most—up to 4
hours a week, or about 35 minutes a day—dropped their risk
of diabetes by 80%, even if they
didn’t lose any weight.
And Chinese researchers determined that people with high
blood sugar who engaged in
moderate exercise (and made
other lifestyle changes) were 40%
less likely to develop full-blown
diabetes.
4
Be a Cereal
Connoisseur
Selecting the right cereal can help you slim down and
steady blood sugar.
A higher whole grain intake is
also linked to lower rates of breast
cancer, type 2 diabetes, high
blood pressure, and stroke—and
cereal is one of the best sources
of these lifesaving grains, if you
know what to shop for.
Some tips: Look for the words
high fiber on the box; that ensures at least 5 g per serving. But
don’t stop there. Check the label;
in some brands, the benefits of fi-
Indulge Your Coffee
Cravings
If you’re a coffee fan, keep
on sipping. The beverage may
keep diabetes at bay.
After they studied 126,210
women and men, researchers at
the Harvard School of Public
Health found that big-time coffee drinkers—those who downed
more than 6 daily cups—had a
29 to 54% lower risk of developing type 2 diabetes during the
18-year study. Sipping 4 to 5 cups
cut risk about 29%; 1 to 3 cups
per day had little effect.
Caffeine in other forms—tea,
soda, chocolate—did. Researchers suspect that caffeine may help
by boosting metabolism. And
coffee, the major caffeine source
in the study, also contains potassium, magnesium, and antioxidants that help cells absorb sugar.
7
Go Veggie More
Often
Women who ate red meat
at least 5 times a week had a 29%
higher risk of type 2 diabetes than
those who ate it less than once a
week, found a 37,000-woman
study at Brigham and Women’s
Hospital. And eating processed
meats such as bacon and hot dogs
at least 5 times a week raised type
2 diabetes risk by 43%, compared with eating them less than
once a week. The culprits? Scientists suspect the cholesterol in
red meat and the additives in processed meat are to blame.
8
Spice Up Your Life
Cinnamon may help rein in
high blood sugar.
German researchers studied 65
adults with type 2 diabetes who
then took a capsule containing
the equivalent of 1 g of cinnamon powder or a placebo 3 times
a day for 4 months. By the end,
cinnamon reduced blood sugar
by about 10%; the placebo users
improved by only 4%.
9
Unwind Every Day
Chronic stress can send
blood sugar levels soaring.
When you’re stressed, your
body is primed to take action.
This gearing up causes your
heart to beat faster, your breath
to quicken, and your stomach
to knot. But it also triggers your
blood sugar levels to skyrocket. “Under stress, your body goes
into fight-or-flight mode, raising
blood sugar levels to prepare you
for action,” says Richard Surwit,
PhD, author of The Mind-Body
Diabetes Revolution and chief
of medical psychology at Duke
University.
10
Get a Perfect
Night’s Rest
A Yale University study
of 1,709 men found that those
who regularly got less than 6 hours
of shut-eye doubled their diabetes
risk; those who slept more than 8
hours tripled their odds. Previous
studies have turned up similar
findings in women. “When you
sleep too little—or too long because of sleep apnea—your nervous system stays on alert,” says
lead researcher Klar Yaggi, MD,
an assistant professor of pulmonary medicine at Yale. This interferes with hormones that regulate
blood sugar.
11
Keep Good
Company
Diabetes is more likely
to strike women who live alone.
Women who live alone are 2.5
times more likely to develop diabetes than women who live with a
partner, other adults, or children,
according to a study published in
Diabetes Care. Researchers examined what role household status played in the progression of
impaired glucose tolerance to diabetes among 461 women, ages
50 to 64, and found higher risk
among women living alone.
www.methodistcollege.edu
12
Have a Blood Test
A simple blood test can
reveal whether sugar levels put you at risk for the
condition. People with prediabetes—slightly elevated blood sugar
levels, between 100 and 125 mg/
dl—often develop a full-blown
case within 10 years. Knowing
your blood sugar levels are a little high can put you on a track
to steadying them—with simple
diet and exercise changes—before diabetes sets in and medications may be necessary.
Everyone 45 and older should
have their blood sugar levels tested. Younger people who have risk
factors such as being overweight,
a family history, and high cholesterol and blood pressure should
ask a doctor about getting tested sooner. If results are normal,
get tested again within 3 years. If
you have prediabetes, blood sugar should be tested again in 1 to
2 years.
(www.prevention.com)
6
Ditch the Drive-Thru
You might get away with an
occasional fast-food splurge,
but become a regular “fast feeder” and your risk of diabetes skyrockets.
That’s what University of Minnesota scientists found after they
studied 3,000 people, ages 18 to
30, for 15 years. At the start, everyone was at a normal weight.
But those who ate fast food more
than twice a week gained 10 more
pounds and developed twice the
rate of insulin resistance—the
two major risk factors for type 2
diabetes—compared with those
who indulged less than once a
week.
Doctor:
We can change the
world with human
embryonic stem cells
Welcome to Our Pediatric Ward!
By Dr. John McDonald
This year marked what just a decade ago many believed would be an
impossible feat - the first human has been injected with cells from human
embryonic stem cells (hES). hES cells, and embryonic stem cells in
general, are one of the greatest scientific tools for discovery of the 21st
century.
The clinical trial brings together the best we have to offer in central nervous system
research to address the difficult
problem of spinal cord injury.
It is a phase I open label
safety trial. To be included, individuals have to have suffered
a complete thoracic spinal cord
injury, which means no movement or sensation below the
injury level. The injury to the
spinal cord must have occurred
between the third and 10th thoracic neurological levels, and
the individual has to be injected with the stem cell therapy,
called GRNOPC1, within seven
to 14 days after the injury.
Following this initial safety
trial, it will take three to five years to
complete a trial that evaluates the
effectiveness of this approach. If
successful, a FDA-approved cellular
treatment for spinal cord injury could
be developed and on the market
within five to seven years.
Although this trial is evaluating
transplantation of hES cells, the
greatest effect of these cells will not
be as a direct treatment. It will be
from the use of hES cells as a scientific tool of discovery, accelerating
progress across multiple fields and
leading to effective repair and recovery. The human genome sequencing
project is similar to the tools offered
by hES cells, and like the human
genome project, hES cell tools will
change our world.
What we collectively decide
today will affect our children
and generations to come. This
is an awesome responsibility,
and one that requires risk and
investment. The primary risk
is of the unknown, and this is
not new or unique to hES cell
technology. Remember the
similar fears surrounding the
idea of sequencing the human
genome? Imagine where we
would be today if we made the
wrong decision out of fear or
from personal ethics?
We must not fear knowledge. We must be decisive
and clear in purpose and allow
science to benefit from all of its
tools. (CNN)
Located on the fifth floor of the hospital, our pediatric ward has officially opened in
April 2010. We have created an inpatient pediatric service that provides comprehensive
care for children requiring hospitalization.
Our pediatric ward environment has cheerful playing atmosphere designed to make
your visit to our hospital less scary and fun through out your healing process.
Our friendly pediatric team of health professionals is committed to provide you and
your child a positive experience and the best possible health outcomes. We strive
to achieve open communication with parents and families to involve them in treatment
and diagnostic decision.
We have many pediatrician as well as pediatric subspecialists including experts in
child growth and development, cardiology, children surgery, hematology, neurology,
psychology, children-dentistry and nutritionist.
We also provide special care unit: NICU (Neo-natal Intensive Care Unit). Our NICU
is headed by Neonatologist - pediatric doctors who have undergone subspecialty
training in management of critically ill newborn babies.
Brawijaya Women & Children Hospital provides a child friendly environment by
creating a Patient EduTainment Program. This program offers many educational and
entertainment activities such as: dedicated Kids TV Channel, Clown Visit, Art & Craft,
Visit by Your Favorite Characters, Story Telling, Puppet Show and Music & Play Session.

Garuda to Purchase 11 New Planes this Year

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