Update News December 13, 2017

In The News

 

Jokowi underscores importance of economic transformation
ANTARA News, 13 December 2017

Jakarta (ANTARA News) - President Joko Widodo (Jokowi) has underscored the need for Indonesia to transform its economy from consumption-based to investment-based economy.

The time has come for Indonesia to shift to investment-based economy from consumption-based economy, he stated in his address to the second gathering of 100 Indonesian economists at Grand Sahid Jaya Hotel here on Tuesday. 

"This way, it (investment-based economy) will be more productive and create a greater multiplier impact on the economy," he noted.
The same is also true with industries that rely on natural resources, he added. 

Indonesia must abandon the economy, which is based on natural resources, without processing and instead must pursue manufacturing industries to increase added value, he remarked. 
"This is the key. Let us not continue to export raw materials without processing them. We must start with process-based economy," he revealed.

He pointed out that the government is building more infrastructures as part of the efforts to boost the national economy.
Equitable infrastructure development across Indonesia is badly needed, he noted. 

"Infrastructure development in Indonesia is urgent because its (existing) infrastructures are far from ideal and even tend to worsen. This is based on the results of a study conducted by the World Bank and McKinsey (in 2013)," he revealed.

Hence, the government has been stepping up infrastructure development in outlying regions, including Papua, which previously received less attention, he stated.The government is building Trans Papua road and several other infrastructures to curb price disparities, especially in Papua, he concluded.

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OJK to Issue Rule on Bitcoin Investments
TEMPO.CO 13 December 2017

TEMPO.CO, Jakarta - The Financial Services Authority (OJK) plans to issue a regulation on the use of investments using virtual currency Bitcoins.

OJK director for capital market supervision Hoesen said they will regulate Bitcoin investments.  The OJK agrees with the Finance Ministry and Bank Indonesia (BI) that Bitcoin investment has a high risk, and Hoesen also said that using Bitcoins to invest is considered illegal because there are no related rules yet. It also has the potential for becoming investment scams, because there is no license for it.

BI has banned the use of Bitcoin for financial transactions. The central bank governor Agus Martowardojo even reminded Bitcoin users to assume their own transactional risk by using the digital currency.

Meanwhile, Finance Minister Sri Mulyani Indrawati expressed fears of inflation due to the use of the crypto currency, and urged the OJK to act immediately upon discovering parties who invest using Bitcoins.

Bitcoin is a virtual currency that has jumped in value by up to 15 times this year. Reported from bitcoin.co.id site, the value of 1 Bitcoin is currently equivalent to Rp249.8 million. They claim to have 716,852 members as per Tuesday, December 12.

Sometime ago, Communications and Informatics Minister Rudiantara expressed his support over BI's policies on Bitcoin use in Indonesia, including the blocking of websites selling Bitcoins.

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Govt Claims Tax Revenue as of Early December 2017 Better
TEMPO.CO 13 December 2017

TEMPO.CO, Jakarta - The government claims that tax revenue as of early December this year is better than last year. “The position is far better,” said Yon Arsal, Director for Tax Potential, Compliance and Revenue of the Directorate General of Taxes, in Bogor yesterday. He, however, did not specify the exact figure.

Nevertheless, Yon said that this year’s tax revenue has not reached the target. As of November, the tax revenue realization stood at Rp1,148.7 trillion or 78 percent of the target set in the revised 2017 state budget of Rp1,472.7 trillion.

Yon said that the shortfall is smaller than that of December 2016 that was boosted by the tax amnesty program. The shortfall stood at Rp400 trillion of the tax revenue full-year target of Rp1,355 trillion.

Yon said that this year’s tax revenue is boosted by all types of taxes. Domestic value-added tax grows steadily at 15 percent and individual income tax grows 44 percent. Meanwhile, legal entity income tax grows 17 percent and Article 21 income tax grows 6 percent.

Sectoral taxes have also posted better growth this year. The mining sector and mining supporting services grow 30 percent, boosted by Articles 25 and 29 income taxes that reach 70 percent. “Thanks to increasing commodity prices,” he said.

In addition, the processing sector grows 17 percent, whereas the trade sector grows 18 percent.As for next year, Yon is confident that the tax revenue target will be achieved considering that the figure is only 10 percent more than this year’s target. He said that the figure is in line with the projected 5 percent economic growth and 3 percent inflation.

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Harbolnas Transaction Likely to Exceed Target
TEMPO.CO 13 December 2017

TEMPO.CO, Jakarta - The National Online Shopping Day (Harbolnas) 2017 fell on Tuesday, December 12.  The accumulated transactions' value during the day is estimated to exceed last year's total of Rp3.3 trillion.

Harbolnas 2017 committee chairman Achmad Alkatiri is confident that this year's Rp4.6 trillion sales target is achieved."We have no actual figures yet, but the target was met," he said.

Achmad, who is also the Chief Marketing Officer of Lazada Indonesia, referred to the high traffic on his site. In addition to Lazada, other e-commerce platforms such as Tokopedia, Shopee, Blibli, MatahariMall, Zalora, and Bukalapak, experienced tremendous increase in traffic to over five million visitors.

The Harbolnas saw discounts offered by online stores. The number of e-commerce participants this year reached 254 companies.
It was first held on December 12, 2012, an agenda initiated by seven e-commerce companies.Each year since it was first held, transaction values continue to soar. 
The first event in 2012 saw Rp67.5 billion worth transactions. In 2016, the number skyrocketed to Rp3.3 trillion in 2016.

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Garuda Indonesia named Airline of the Year at 2017 ITTA ceremony
The Jakarta Post, 13 December 2017

National flag carrier Garuda Indonesia was named Airline of the Year at the 2017 Indonesia Travel and Tourism Award (ITTA) ceremony on Monday.
Launched in 2010, ITTA’s winners are selected based on two methods: 25 percent online voting and 75 percent voting from a committee that comprises experts in the travel and tourism industry.

Garuda Indonesia marketing director and information technology Nina Sulistyowati said in a press release that the award was the seventh received by Garuda Indonesia at the annual event, adding that it proved the airline's consistency in delivering an “operational excellence” service to its passengers.

Nina added that the award was also part of the airline’s commitment to support the government in improving the country’s tourism sector, particularly to achieve the target of attracting 20 million foreign tourists by 2019.

Nina said that in line with ITTA’s commitment to create awareness about the importance of quality service in travel and tourism industry, the airline continuously tried to improve its services as well as operations, ensuring a convenient flight experience for passengers. (kes)

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Additional trains to depart from Jakarta during Christmas, New Year
The Jakarta Post, 13 December 2017

To anticipate the increasing number of passengers during the Christmas and New Year holiday season, state-owned railway operator PT Kereta Api Indonesia (PT KAI) will add 17 additional trains traveling from Jakarta starting next week.

The trains will operate from Dec. 22 to Jan. 7, 2018, KAI said in a written statement on Monday. 
Twelve of the new trains will depart from Gambir Station in Central Jakarta, while the rest will leave from Pasar Senen Station, also in Central Jakarta.

KAI added that seven of these trains would travel to Central Java, six to East Java, while the rest will serve West Java routes.
The total number of trips during the holidays is expected to reach 72, kompas.com reported.

With the additional routes, KAI will also increase the number of tickets sold to 8,688 each day, while predicting a 7 percent rise in passengers.
Data on Monday’s ticket sales showed that tickets to cities in West Java, East Java and Central Java were almost sold out. (dpk)
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Gov't to Accelerate Priority Programs in Maritime and Fisheries Sector
Jakarta Globe, 13 December 2017

Jakarta. The government will accelerate procurement of goods and services in the maritime and fisheries sector next year, a senior official said on Tuesday (12/12).
"As part of our [effort at] transparency, we will accelerate procurement of goods and services in 2018," Ministry of Maritime Affairs and Fisheries secretary general Rifky Effendi Hardijanto said.
According to Rifky, the ministry will invite various private stakeholders to participate in its procurement projects.

Many of the previous projects were flawed by markups, delays and inconsistencies in contracts with parties that had won the ministry's tenders.
One of the ministry's priority programs is financial assistance to small-scale fishermen to help them purchase boats, aimed to narrow the economic gap between smallholders and big fishing companies.The ministry has targeted to provide 782 fishing vessels by the end of the year, but so far only 101 boats have been distributed.
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Asean Officials Gather in Jakarta to Study the Law of the Sea
Jakarta Globe, 13 December 2017

Jakarta. As ocean issues have been emerging in many countries of late, officials from the Association of Southeast Asian Nations member states began training in the Law of the Sea on Tuesday (12/12), to be able to address the challenges collectively.

"This training takes place at a critical juncture, as the world is paying more attention to emerging ocean issues, which range from disputes over maritime boundaries to overfishing, marine pollution and climate change," director general for Asean cooperation at the Ministry of Foreign Affairs, Jose Tavares, said during his opening remarks.

The ministry, in collaboration with the United Nations and the Center for Strategic and International Studies (CSIS), hosted the first Asean-UN Training Workshop on the Law of the Sea in Jakarta.
The three-day workshop is co-sponsored by the Mission of Japan to Asean and the German Embassy in Jakarta.
Vice-chair at the CSIC board of trustees, Jusuf Wanandi, said the seminar will properly prepare Asean officials.

"[It's important to] learn more about Unclos [the United Nations Convention on the Law of the Sea] and to know all the intricate developments and interpretations of the convention's articles, so [that] we are better equipped in the future," he said.

The convention provides a legal framework for all maritime activities.According to Jose, the role of Unclos in ocean governance is "indispensable and increasingly important."
CoC on South China Sea
The workshop may prove essential for Asean, which is still negotiating with China the terms of the Code of Conduct (CoC) on the disputed South China Sea.
Jusuf said the seminar will provide grounds for the negotiations and future implementation of the code "so that we can ... deal with the Chinese in the right way."

He emphasized the need for the code to reflect a "rules-based mechanism.""Peace and stability in the seas of Asia are a vital foundation for the well-being and prosperity not only of the region but also of the international community," said Hikariko Ono, the acting charge d'affaires at the Mission of Japan to Asean.

She emphasized that deeper understanding of the Law of the Sea is "a fundamental and important step towards promoting the rule of law at sea."
UN Office of Legal Affairs director for ocean affairs and the Law of the Sea, Gabriele Goettsche-Wanli, said the workshop is focused on capacity building.

"Capacity building is essential to allow states to fully implement the Unclos [treaty]," she said, adding that the training will cover a wide range of issues, including maritime navigation and safety, conservation and management of living marine resources and settlement of disputes.

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President optimistic of economy remaining unaffected by political situation
ANTARA News, 13 December 2017

Jakarta (ANTARA News) - President Joko Widodo expressed hope that the rate of economic development would remain unaffected by the political situation in Indonesia in the run-up to the political year 2018.

"It means that let us develop Indonesia together. Economic stakeholders and political figures can kick-start their efforts respectively," Widodo noted in his speech at the 2nd Discussion of 100 Indonesian Economists in Jakarta on Tuesday.

The president expressed confidence that the elections in Indonesia would be held in a peaceful and secure manner.

He noted that the recent regional elections in 2017, which were held securely, did not affect the economic situation.Widodo said several economic developments were achieved in the last three years.

This was reflected in the improvements in ratings given by Moody`s Rating and S&P that boosted Indonesia`s investment grade ranking.
Of 137 countries, Indonesia`s global competitiveness index also improved, from 41 to 36.

"The figures demonstrated that we should remain optimistic about our economic development. Other countries placed us on their potential investment radar. Let us observe the pace of development," Widodo stated.

Widodo said several parties were raising doubts over Indonesia`s economic conditions in 2018.
However, he called on economists and entrepreneurs to have trust in the country`s political situation and begin investing in the country.

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