Focus

Focus (182)

24
February

President Joko Widodo inaugurated an Asia-Pacific Rayon textile factory (APR) in Pelalawan Regency, Riau, Friday (21/2). In his speech, President Joko Widodo said that he was surprised to find out that the Asia Pacific Rayon textile factory has sophisticated technology to produce 200 million industrial plant seeds in the form of acacia and eucalyptus. He also admired the APR technology which converts wood fiber into rayon type textile. The President said that the Government of Indonesia is committed to supporting the investment climate because many people do not realize that the business community is very large in favor of the circulation of money and also the wheels of the economy. Therefore, he asked Minister of Industry, Agus Gumiwang Kartasasmita to support the development of the Indonesian garment industry to go more globally. On this occasion, President Joko Widodo also sent off containers containing over 10,000 tons rayon fiber for export to Turkey and 12,000 tons for shipping to Central Java. He appreciated the Asia Pacific Rayon investment which supports the development of the national textile industry. In addition, the presence of the Asia Pacific Rayon is also expected to be an alternative to reduce dependence on imports of textile raw materials, especially cotton. On that occasion, Minister Agus Gumiwang Kartasasmita said that optimizing the use of textile raw materials originating from within the country is very important in improving the performance of the textile industry and Indonesian textile products. According to Minister Agus Gumiwang, his side is currently carrying out several steps to continue to improve the performance of the labor-intensive industry. To improve the competitiveness of the textile industry and textile products, he has endorsed many aspects. One of them is to facilitate the availability of domestic raw materials. Meanwhile, Director of Asia Pacific Rayon, Basrie Kamba said that the presence of Asia Pacific Rayon could have a positive impact on employment and business opportunities for small and medium enterprises in the upstream-downstream textile and textile products (TPT) industries. Besides Turkey, he said that Asia Pacific Rayon products were also exported to 14 other countries, including the world textile markets such as Pakistan, Bangladesh, Vietnam, Brazil, and a number of countries in Europe. In addition to exports, Asia Pacific Rayon production is also intended to meet the needs of domestic textile raw materials.

19
February

Indonesian Trade Minister Agus Suparmanto visited the United States on February 13 to 15, to increase export and remove trade barriers between the United States and Indonesia.

On the first day, Minister Agus Suparmanto met representatives from the United States Trade Representative –USTR  in Washington. They discussed import duty relief facility or Generalized System of Preferences. Minister Agus explained that in the meeting on Thursday morning, the US Trade Representative had agreed on some matters that had not been  negotiated yet.

A number of un-negotiated matters including issues relating to joint insurance with the Financial Services Authority (OJK) and new horticulture product import regulation after  the US won a lawsuit against Indonesia at the Dispute Settlement Body of World Trade Organization-WTO.  The Minister  hoped, the Generalized System of Preferences discussion can be finished before Indonesian President Joko Widodo visits Las Vegas to attend  the ASEAN-US Summit in mid March 2020.

On the second day, Minister Suparmanto received some US business people  representative joined in US-ASEAN Business Council (US-ABC). They discussed some trade barriers, including e-commerce sector. After the meeting, the Minister said, e-commerce regulation is purposely made to record businesses on electronic platform taking place in Indonesia. The regulation is aimed at protecting consumers in Indonesia.

Meanwhile, US-ABC delegation led by President and CEO of US-ASEAN Business Council Alexander C. Feldman hopes, Indonesia can increase the effort thereby it is ready to receive Information and Communication Technology investment, mainly in terms of regulation, infrastructure, and investment barrier reduction in that sector.

Minister Agus Suparmanto also explained about the development of Omnibus Law that will facilitate investors and businesspeople to invest in Indonesia. Omnibus Law was also called as a policy expected by businesspeople because there were many regulations burdening the businesspeople, especially related to licensing, that soon will be simplified.

In the meeting, there were also Indonesian Coordinating Minister for Maritime and Investment Luhut Binsar Pandjaitan, Minister of Communication and Information Technology Johnny G. Plate, as well as Deputy Minister of Foreign Affairs Mahendra Siregar.

Besides discussing on trade development, in the meeting Indonesian delegations also promoted investment, including development investment opportunity in the new capital city.

17
February

The Indonesian government continues to open a wider export access to  New Zealand, especially in  labor market and agricultural products so that bilateral relations continue to improve. Director General of International Trade Negotiations, Iman Pambagyo who was  Head of the Indonesian Delegation at the 7th Senior Official's Meeting on Trade and Investment Framework (SOMTIF) in Wellington, New Zealand on Wednesday, February 12 said.

Iman Pambagyo through his statement in Jakarta On Friday, February 14, revealed that  at the SOMTIF this time, the Indonesian delegation fought for access  to enter New Zealand labor market. In addition, there is also access to Indonesian tropical fruit products, specifically related to solving non-tariff barriers for mangosteen, banana, pineapple, snake fruit, and mango products.

According to Iman Pambagyo, in addition to the issue of labor and agricultural market access, Indonesia also invited New Zealand investors to invest in Indonesia in the livestock, tourism, vocational and tertiary education sectors, as well as the creative economy. Collaborations offered in the creative economy sector include film and animation. He asserted, New Zealand has a fairly advanced film industry. Many box office films are made in New Zealand, such as the Hobbit and Lord of the Ring. Therefore, Indonesia wants to establish cooperation through the forum. He added, the issues that the Indonesian delegation was seeking at the SOMTIF meeting were in line with President Joko Widodo's vision to develop human resources and improve export performance, including to New Zealand. He reiterated, amid of the current world economic slowdown, SOMTIF has an important meaning in increasing cooperation between Indonesia and New Zealand.

The Senior Official’s Meeting on Trade and Investment Framework -SOMTIF is a regular annual bilateral forum between Indonesia and New Zealand. It discusses trade and investment issues and it is a momentum  for  improving trade and investment performance through technical cooperation. SOMTIF was formed in 2005 and was first held in Wellington on July 14 and 15, 2008. Furthermore, the SOMTIF agenda is carried out alternately by the two countries.

Indonesia's main export products to New Zealand are oil cake, coal, wood and tires. Meanwhile, Indonesia's main import products from New Zealand are dairy products, wheat flour, and chemical wood pulp. Data from the Investment Coordinating Board shows the value of New Zealand's investment realization in Indonesia was recorded at US$2.6 million dollars in 81 projects. The majority of investment is in the tertiary / service sector such as hotels, restaurants and tourism. While Indonesian companies investing in New Zealand engage in the distribution of phosphate and surfactant.

14
February

Indonesian President Joko Widodo instructed economic ministers in the Indonesian Cabinet to come up with policies that could reduce the value of iron and steel imports. The large amount of steel imports is one of the sources of Indonesia's trade balance deficit. Based on data from the Central Statistics Agency (BPS), the total value of Indonesia's iron and steel imports in 2019 reached 10.3 billion US dollars, up slightly from 2018 which touched 10.2 billion US dollars. With that much value, iron and steel are now the second largest imported commodity in Indonesia after electronic machinery and equipment. President Joko Widodo at the Presidential Office, Jakarta, Wednesday (Feb12) requested that the negative trend be immediately ended. If import policy continues to be opened up on a large scale, local steel mill utilities will never develop and the industry will not be able to progress. In fact, according to president Joko Widodo, the domestic industry has been able to produce some of the imported iron and steel.

 

Therefore, he urged the economic ministers to provide regulations that could encourage national iron and steel production, such as the provision of easier and cheaper raw materials. The President stressed that Indonesia needs to improve the ecosystem of supplying raw materials for the steel and iron industries, such as the availability and stability of raw material prices. According to the President, raw materials from national mining products can be prioritized in order to increase added value in the country. This is not only to reduce imports, it can also open jobs.

 

President's request, Minister of Industry Agus Gumiwang ensured that he would reduce imports of iron and steel raw materials. The move was taken to strengthen the competitiveness of national industrial production, so that Indonesia does not continuously depend on imported steel.

 

Of the total requirement of 14 million tons per year, the domestic scrap metal industry is only able to supply 5 million tons, so there are still around 9 million tons that must be imported from abroad. However, with the reason to protect the domestic metal scrap industry and reduce the import of hazardous and toxic waste materials, scrap metal imports are limited to only 5 million tons.

10
February

The Ministry of Research and Technology proposed 6 products in the down-streaming of superior products to President Joko Widodo. These products range from drones for military needs to canned food and salt.

 

Minister of Research and Technology, Bambang Brodjonegoro at the Presidential Office, Jakarta, Thursday (6/4) said that the President would like to focus on several domestic innovation products. All of them were shown to the President during the Research and Technology Coordination Meeting last week.

 

The first were Drones for military purposes. According to Bambang, the drones will be produced by PT Dirgantara Indonesia Ltd and PT Len Industri Ltd. This unmanned aircraft will be used to maintain internal security, especially at the border.

The second was biofuel. This product will be different from the B20 program, because it uses the majority of raw materials from the palm kernel and a catalyst. This product can produce gasoline, diesel and avtur (aviation fuel).

 

Third, stem cells for the treatment of fractures. This product has been proven to heal human broken bones back to normal, although not in a short time.

 

Fourth is integrated industrial salt. The Agency for the Assessment and Application of Technology will design a production machine that can convert farmers' salt into salt for industrial needs. Related to this, Bambang said there was already a pilot factory in Gresik. The president has ordered that more factories be built in other areas, especially those with many salt farmers.

 

Fifth one id canned food. Currently, the Indonesian Institute of Sciences is developing technology without chemicals to produce Indonesian special foods in canned form.

 

Bambang said that so far the popular canned food produced is only of sardines or corned beef types, containing only fish or meat. He said he urged Small and Medium Enterprises to develop local food in cans.

 

Sixth is a flat ship, which can later be used by fishermen at affordable prices. This shipbuilding process only takes 60 days, and has been tested for use for inter-island transportation in the face of high waves.

07
February

The Indonesian Customs Office and the Singapore Police Coast Guard agreed on a Memorandum of Understanding in a bidto enhance maritime surveillance in the sea border area. The memorandum of Understanding was signed by Director General of Customs and Excise of the Indonesian Ministry of Finance, Heru Pambudi and Commander of Singapore Police Coast Guard, Cheang Keng Keong at the Customs Headquarters in Jakarta recently. Heru Pambudi in an official statement released by Bisnis Indonesia on Tuesday (4 Feb) said that the Memorandum of Understanding is intended as a basis ro cooperate in the exchange of information, to prevent and eradicate smuggling and other organized crime, as well as a basis for the two parties to work together on coordinated sea patrols. As a crossing location of inter-continental and inter-oceanic ships, the Indonesia-Singapore sea border becomes a strategic route that is crowded with international maritime activities. So, the route requires tight supervision.

The bilateral cooperation is also aimed at preventing the smuggling of goods, Narcotics, Psychotropics and Precursors (NPP) or other illegal goods. It is worried that illegal practices can be used to fund larger criminal activities, such as transnational organized crime and terrorism. The two parties will also work together to improve the ability of Human Resources  and institutions, through various education and trainings and capacity building, for the realization of strong and effective supervision. This cooperation is intended to secure sea crossings from security threats that connect the two countries, along with protecting the wider community. Furthermore this cooperation is also intended to protect local industries from smuggled goods which can reduce the competitiveness of the domestic market.

05
February

Head of Indonesian Investment Coordinating Board (BKPM), Bahlil Lahadalia, in Jakarta on Monday said, all business licensing had been delegated to BKPM beginning Monday (3/2). Therefore, representatives from 25 ministries and institutions began working at BKPM for the one-stop licensing service.

Bahlil Lahadalia said that was in line with Presidential Instruction No. 7 2019, that mandated BKPM to evaluate all licensing processes. Then, it assigned the ministry to delegate some licensing authorities to the Investment Coordinating Board.

Bahlil said the process forall permit issuance is carried out at BKPM,except those permits for upstream oil and gas, which will still be processed at the authority of Energy and Mineral Resources Ministry. The downstream oil and gas sector such as transportation, gas station, and mining permit (IUP) are at BKPM.

Although Bahlil Lahadalia could not specify the time needed to finish the licensing, he assured there will be acceleration. License processing durations depend on model or type of business permit, such as environmental impact analysis and mining business permits that require technical assessment which will not be finished in one day.

Bahlil explained, since tax incentive giving to investors moved to BKPM, businesspeople who invest and fulfill regulations will receive incentives, namely they do not need to visit ministry offices. Therefore, licensing processes can be more efficient in terms of time and cost, including their certainty.

Meanwhile, business permits under regional governments, namely in provinces, regencies, and cities, will be directly carried out by One-Stop Integrated Service and Investment Agency. The Home Affairs Ministry issued letters to governors, regents, and city mayors to ensure permits are only being processed at One-Stop Integrated Service and Investment Agency.

Bahlil Lahadalia said, currently they are formulating the Norm, Standard, Procedure, and Criteria (NSPK). Previously, after receiving a business registration number (NIB), businesspeople must receive approval from all related ministries and bodies, so those related ministries and institutions will put a representative at the Investment Coordinating Board office. This is because businesspeople require three things, namely speed, certainty, and efficiency.

03
February

The Indonesian Minister of Trade, Agus Suparmanto, said that the government will limit food and beverage imports from the People's Republic of China. The restriction was made following the outbreak of novel coronavirus (2019-nCoV) in the country. Agus Suparmanto on the sidelines of a sudden inspection at the Wonokromo Market in Surabaya, East Java on Friday, January 31, said, in addition to carrying out restrictions, importers would also be asked to selectively import food and beverages. This   because the current spread of the virus is already at an alarming level. However, the Minister was reluctant to specify the types of food and drinks he would limit to enter Indonesia. He said all foods would be strictly selected.

Corona virus outbreaks have spread and killed more than 200 people and infected thousands of others. The Ministry of Health previously stated that the Corona Virus can only live on animate objects. Secretary of the Directorate General of Disease Prevention and Control of the Ministry of Health Achmad Yurianto said the virus can also only develop in living cells. On this basis, he said that imports of goods from China remained safe.

Nevertheless, Minister of Trade Agus Suparmanto stressed, the government remained cautious. He claimed that he would not totally stop importing from China, since some Indonesian importers have also been bound by contracts. The Minister said that he did not want to make a harmful policy. Adding, this limitation might later affect the decline in import figures, though would not have much effect on exports.

A few days earlier, the Director General of Customs and Excise of the Ministry of Finance Heru Pambudi said that the government was currently focusing on watching out the movement of people between countries to anticipate the virus entering Indonesia. However, the latest developments from the spread of the virus would also be followed closely. If it is required, restrictions on imported products from China can be applied.

31
January

Governments of Indonesia and Singapore agreed to strengthen bilateral cooperation in an effort to increase competitiveness and development of industrial sector, beginning from increasing the investment till the implementation of vocational education programs. This is believed to encourage economic growth in both countries.

Indonesian Minister of Industry Agus Gumiwang Kartasasmita, after meeting Singaporean Minister of Trade and Industry, Chan Chun Sing at the Ministry of Industry, Jakarta on Tuesday (Jan28). as reported by Antara News Agency, said that the two countries had cooperated to encourage the application of 4.0 industry. This was stated at the signing of a Memorandum of Understanding between the Industrial Research and Development Agency, the Indonesian Ministry of Industry and Enterprise Singapore, at the Indonesia-Singapore Leaders Retreat event at the IMF Annual Meeting session in Bali, October 2018. 

In addition, the two countries have established cooperation aimed at increasing industrial human resources, especially in Indonesia, through vocational education programs. Since 2018, training has been conducted for 100 participants consisting of school principals, deputy principals and teachers in Indonesia. This year there will be the implementation of training of 4.0 industry for 120 participants, including management staffs and industrial polytechnic teachers.

During the first semester of 2019, Singapore remained one of biggest investors in Indonesia, with an investment of US$3.4 billion. Next cooperation opportunities include exploring the development of integrated industrial estates such as the Kendal Industrial Estate, and also in other areas of Indonesia outside Java, such as Tanah Kuning in North Kalimantan, Kuala Tanjung in North Sumatra, Bitung in North Sulawesi, Batanjung in Central Kalimantan, Palu in Central Sulawesi and Jambi. Minister Agus Gumiwang Kartasasmita also conveyed to the Singaporean Minister of Trade and Industry, to look for the country's investors who are interested to invest in the sectors.

Minister Agus Gumiwang added, his Ministry invited Singapore to participate in building maintenance, repair and overhaul (MRO) of industrial area of the Bintan Islands at the location that had been prepared. In addition, the Minister also encouraged the acceleration of cooperation in logistics to build a network in ASEAN that will be centered in Batam. To support ASEAN economic activities in particular, Indonesia and Singapore agreed to prioritize digital economic development as well as food innovation and safety.

29
January

The completion of new facilities of the Soekarno-Hatta International Airport comprising runway 3 and the East Connection Taxiway (ECT) is expected to support the efficiency of aircraft movement at the airport. It was stated by Indonesian Transportation Minister Budi Karya Sumadi when observing the new facilities of the Soekarno-Hatta International Airport in Tangerang, Banten, on Sunday (Jan26).

The Runway 3 at the Soekarno-Hatta International Airport which was inaugurated by Indonesian President Joko Widodo on Thursday (Jan23) has operated since the end of 2019 namely during the celebrations of Christmas and New Year’s Eve.

The Indonesian Transportation Ministry claimed that the new facilities of the Soekarno-Hatta International Aiport would accelerate the aircraft movement from 8 percent to 30 percent. Minister Budi Karya Sumadi pointed out that the Soekarno-Hatta Airport is the face of Indonesia. Therefore, the airport must improve its services and safety procedure. The Minister called on all related stakeholders in the sector of aviation to keep developing aircraft facilities and infrastructures which can be implemented in all regions across Indonesia.

Based on report of the PT Angkasa Pura II, the aircraft movement during the Christmas and New Year celebrations improved 80 movements per hour to 100 movements per hour since the inauguration of the Runway 3 and East Cross Taxiway since the end of 2019.

Among the benefits of the Runway 3 and east cross taxiway include improving flight safety through the separation of runways for takeoff and landing, reducing aircraft queues from 6 to 9 aircrafts to approximately 3 planes as well as accelerating aircraft movement from aprons to runways.

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