THE COORDINATING MINISTRY FOR ECONOMIC AFFAIRS
REPUBLIC OF INDONESIA
Main Building, Ministry of Finance, Jl. Lapangan Banteng Timur No.2-4 Jakarta 10710
Tel: (021) 351-1178 Fax: (021) 351-1186 Website: http://www.ekon.go.id
Trade and Investment News[1], 25 May 2009
Highlights
National
· Bali to build new international air terminal as arrivals grow
Politics
· Analysts say commanding lead in polls no guarantee of re-election for president
Terrorism
· Fugitive radicals still capable of creating dangerous terror groups, says ICG
Law & order
· Immigration officials say impossible to turn back tide of illegal immigrants
· Government asks Singapore to extradite banker sentenced for graft
Health
· World health officials accept Indonesian proposal for new virus-sharing system
Economy
· Bank Indonesia says rupiah may strengthen further on signs of global recovery
Business briefs
Macroeconomy
· Government to sell additional Rp2 trillion in debt this week
· Bank Indonesia books $4 billion current account surplus
Investment
· JPMorgan Chase upgrades Indonesian stocks to overweight
· PT Sorini to build new tapioca plant in Lampung
State concerns
· Tourist arrivals rise marginally in first quarter
SOEs
· New commuter rail company to invest Rp1.2 trillion in upgrading
Private sector
· Salim Group keen to increase holding in cement maker PT Indocement
Banks
· BCA may launch shariah bank in September
Power
· PT Pertamina prepares heads of agreement for second-stage expansion program
Oil & gas
· France’s Total to sign LNG deal with Japanese buyers
· Government to extend Medco’s Blok A gas field contract
Mining
· Earthstone Resources to produce 3 million tons of iron ore
NATIONAL
Bali to get new airport terminal by 2013: Official
Ngurah Rai International Airport in Denpasar, Bali, will get a new terminal capable of handling 7.5 million passengers per year, Antara reported.
“The new terminal will be located next to the current domestic terminal and will cover an area of 100,000 square meters,” said Heru Legowo from airport operator PT Angkasa Pura I.
Legowo said the terminal, which will cost about Rp1.2 trillion, will only serve international routes.
The new terminal is in response to the growing number of tourists visiting Bali each year, Legowo said, adding the construction is planned to commence by the start of 2010 and will take three years to complete.
Bali Governor Made Mangku Pastika said in January another airport will be constricted in Bungkulan village, Kubutambahan district, Buleleng regency, with Vice President Jusuf Kalla already approving the plan.
POLITICS
SBY not a shoo-in, say analysts
Pollsters say President Susilo Bambang Yudhoyono will be re-elected easily on July 8, but some analysts insist that such predictions are premature, The Straits Times reported.
Yudhoyono and his running mate, former Bank of Indonesia governor Boediono, must win over 50% of the votes cast the first time or a run-off election will be required on September 8.
While approval ratings for Yudhoyono are high, Indonesian Survey Institute senior researcher Burhanuddin Mutahdi said that could change.
“The opinion of society is dynamic. Even if the electability of Yudhoyono - Boediono is high, it does not mean they cannot be defeated,” Mutahdi told the Suara Pembaruan daily.
Two other pairings - former president Megawati Sukarnoputri with former general Prabowo Subianto, and Vice President Jusuf Kalla with former Armed Forces commander Wiranto - are running against Yudhoyono and Boediono
Analyst Bima Arya Sugiarto said all the candidates are still in the running. “It's still too early to say that Yudhoyono will win in one round. There is the Boediono factor,'” he said, referring to the perception of Boediono as a free-market policymaker, a view which could turn off some voters.
Some sectors in society fear that this means the government will be pro-foreign investment and have little interest in helping the ordinary citizens.
Sugiarto, who runs the Charta Politika political consultancy, said the candidates' campaign teams would have to play up their strengths.
For instance, Kalla and Wiranto could portray themselves as the most representative of Indonesian society, he said.
Kalla is from outside Java, is an entrepreneur and has the support of Islamic groups. His running mate is Javanese, a former military man and seen as advocating the protection of the domestic market.
Prabowo wealthiest in presidential poll line-up
Former general Prabowo Subianto, who is standing for vice president, is the wealthiest candidate contesting the July election, data from the Corruption Eradication Commission (KPK) showed, owning 27 companies worldwide and about 90 thoroughbred horses, Reuters reported.
Prabowo, 57, who is teaming up with opposition leader Megawati Sukarnoputri in the election, is estimated to have personal wealth of $160 million, the KPK said in a report.
The ex-general owns plantations and mines in Indonesia, as well as businesses in Argentina and France, an official from his Gerindra Party said.
He also has about 90 horses worth $5,000 each, some at his estate in Bogor, West Java, an official from the KPK said, after verifying Prabowo's wealth report.
According to the law, presidential and vice presidential candidates are obliged to disclose their wealth as part of efforts to boost transparency.
President Susilo Bambang Yudhoyono, whose vice presidential candidate is former central bank governor Boediono, also faces a challenge from Vice President Jusuf Kalla and his running mate former general Wiranto in the July 8 election.
Sulawesi-born Kalla, whose extensive family business interests range from construction to real estate, came in second place in terms of wealth with $29 million, the data showed.
Former president Megawati was third with about $14 million, while Yudhoyono was at the bottom of the list with $920,500, according to the data.
TERRORISM
Fugitives help radicalization of terror recruits, says ICG
Militant fugitives in Indonesia have the potential to turn non-violent activists into would-be bombers even as the overall threat of terrorism declines, the International Crisis Group (ICG) said.
Its report, entitled Indonesia: Radicalization of the “Palembang Group,” uses documents from the trials of 10 men from Palembang, South Sumatra, sentenced in April to heavy jail terms on terrorism charges, to show how radicalization takes place.
“The sobering revelation is how easy the transformation can be, if the right ingredients are present,” said Sidney Jones, ICG’s Asia Program senior adviser.
“In this case, the most important element in turning the group towards violence was charismatic leadership, provided by two terrorist fugitives.”
One of the men was Fajar Taslim, alias Mohammad Hasan, a member of the regional jihadi group Jemaah Islamiyah (JI), who fled Singapore in late 2001 with the recently re-arrested Mas Selamat Kastari, head of JI in Singapore.
The other was Sulthon Qolbi, who was wanted for multiple crimes committed in Maluku.
The two men separately came upon a small Islamic study circle whose biggest concern was the conversion of Muslims by Christian evangelicals in South Sumatra.
According to the report, the big leap was persuading members of the group to consider violence against the proselytizers.
Once they were willing to kill, a broader range of targets became thinkable.
The Palembang group was inept and failed in four out of five of its planned operations, but the case holds important lessons for counter-radicalization strategies, the ICG said.
“While JI has grown progressively weaker as an institution, individual members outside the mainstream, many of them wanted by police, can still provide motivation and training to transform a non-violent group into militant extremists,” it said.
Nine of 10 members of the Palembang group were not JI, but JI members provided crucial input along the way.
The report suggested the Indonesian government pay increased attention to JI-related schools, not because of what they teach but because of their role as communication hubs and places of refuge.
The director of the JI school near Palembang was against violence and never joined the group, but visitors to the school facilitated the radicalization process.
The fear of “Christianization” – conversion of Muslims – can be a powerful local driver for radicalization in Indonesia, especially now that communal conflicts have waned, it said.
“It would be possible to conclude the Palembang men were such hapless bumblers that if this is all Indonesia has to worry about, it is in good shape,” said Jim Della-Giacoma, ICG’s Southeast Asia project director.
“But a similarly amateurish group with the same bombs and a little more luck could have a much more lethal effect,” he added.
LAW & ORDER
Illegal migrant tide ‘can’t be held back’
Despite a rise in the number of illegal migrants using Indonesia as a stepping-stone on their way to Australia, immigration officials say they are powerless to stem the flow, The Jakarta Globe reported.
The claim came hours after the arrest in Lampung of the latest batch of Afghan migrants — nine men and four women — all without travel documents.
Their arrests, at the Bakauheni port where ferries bound for Java depart, bring the total to 147 illegal migrants detained in the past month.
Maroloan Barimbing, a spokesman for the Directorate General of Immigration, said the number of illegal migrants entering Indonesia has increased dramatically since last year, with well over 1,000 detained since the beginning of the year.
He said the government has limited resources to provide security across the archipelago against the illegal migrants.
“We don’t have enough personnel or facilities, especially in smaller, outer islands,” Barimbing said.
He said his office would continue to work with the Maritime Security Coordination Body, the Maritime Police, the Navy and the Ministry of Transportation’s Sea and Coast Guard to patrol the country’s shores.
Besides Afghans, recent groups of illegal migrants have included Iraqis, Sri Lankans, Bangladeshis and ethnic-minority Rohingyas from Myanmar.
He said that ad-hoc working groups set up as a result of the Bali Process on refugees and illegal migrants, co-chaired by Indonesia and Australia, were to meet later this month and expected to help identify the root causes behind the problem.
Govt. requests Singapore’s help to catch graft fugitive
The government is seeking assistance from Singapore to extradite a key graft fugitive identified as Samadikun Hartono, who is believed to be hiding in the neighboring country, National Police chief Gen. Bambang Hendarso Danuri said Friday, The Jakarta Globe reported.
“God willing, we will discuss the issue at an upcoming meeting in the near future,” Danuri said, dispelling rumors that Hartono was already in police custody.
Rumors were circulating last week that Hartono, who was to be imprisoned in May 2003, had been arrested when the National Police hosted a meeting with Singapore Police officials on Wednesday.
Hartono fled Indonesia after being found guilty by the Supreme Court and sentenced to four years in jail and fined Rp169 billion ($16 million) for the misuse of Bank Indonesia Liquidity Assistance (BLBI) funds issued in the wake of the 1997-1998 Asian financial crisis
At the time, Hartono was chief commissioner of the now-defunct Bank Modern.
According to Danuri, last week’s meeting focused on transnational crimes and the April 1 capture of terror fugitive Slamet Mas Kastari in the Malaysian state of Johor Baru.
Muchtar Arifin, head of the government’s graft fugitive-hunting team and Deputy Attorney General, said it is believed Hartono has avoided justice by hiding in several countries, including China and Singapore.
Without an extradition treaty between Indonesia and Singapore, Arifin suggested Hartono’s return be arranged under the Mutual Legal Assistance Agreement signed by all ASEAN members, including Indonesia and Singapore.
“Singapore is a safe haven for many graft fugitives from Indonesia,” Arifin said.
Apart from Hartono, another fugitive identified as Bambang Sutrisno, a former commissioner of Bank Surya, who fled a life sentence for embezzling BLBI funds, is also believed to be living in Singapore, Arafin said.
Region Kadin head named suspect over $21M bank fraud
Jakarta Police have named the head of the North Aceh Chamber of Commerce and Industry (Kadin) a suspect for his alleged role in the theft of Rp220 billion ($21.3 million) from a Bank Mandiri account belonging to the North Aceh district administration, The Jakarta Globe reported.
Bahagia Dachi, head of Jakarta Police’s fiscal, monetary and reserves division, said it had been “proven” that senior Aceh Kadin member Basri Yusuf was involved in a conspiracy to embezzle funds from the Jelambar, West Jakarta branch of Bank Mandiri.
Jakarta Police spokesman Chrysnanda Dwi Laksana said other suspects Cahyono, head of the Jelambar branch of Bank Mandiri, and a woman identified as Lista, were arrested on May 14.
Police are still in pursuit of at least two more suspects, identified only by their initials, TAH and ER.
Laksana would not rule out the possibility that officials from the North Aceh district administration could also be named suspects and arrested.
Dachi said that Yusuf met Lista, who introduced him to Cahyono, in Jakarta before lobbying the North Aceh administration to transfer Rp220 million into the Mandiri account, claiming the bank offered a more competitive interest rate.
On February 4, forged documents were used to remove the Rp220 billion, which was then distributed to several people, Laksana said.
Dachi said that after tracing the money Rp198 billion was discovered in Lista’s account but around Rp20 billion is still missing.
HEALTH
Progress made on virus sharing: Health Ministry
World health officials have accepted a proposal by Indonesia for a new system of sharing virus samples, a move that would enable all countries to access the viruses for research, an official said Friday, The Jakarta Globe reported.
The World Health Organization’s (WHO) 62nd general assembly in Geneva, Switzerland, agreed that the Standard Material Agreement (SMTA) should be concluded by January next year at the latest.
Makarim Wibisono, Indonesian delegate at the assembly, said the finalization of the plan proposed two years ago was the result of efforts by Health Minister Siti Fadillah Supari, who has been trying to change the virus sharing mechanism since 2007.
Under the SMTA, scientists from both developed and developing countries would be able to obtain virus samples for research purposes, as well as build facilities to create derivative products from the virus, including vaccines and antiviral drugs.