04
September

President: Time to Reconstruct Lombok

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 President Joko Widodo has stated that it is time to rehabilitate and reconstruct West Nusa Tenggara after the earthquakes that hit the area more than a month ago. At a gathering on West Nusa Tenggara Rebuilding held in Gunung Sari Sub-district, West Lombok District, West Nusa Tenggara Province, on Monday, the president noted that the emergency response stage had passed and it is time for rehabilitation and reconstruction.

"Yesterday, I noticed several buildings being reconstructed under the direction of the Ministry of Public Works," the president remarked, as conveyed by the Presidential Secretariat Deputy for Protocol, Press and Media, Bey Machmudin.

About 2,250 volunteers from various institutions participated in the gathering. On the occasion, Widodo noted that the first step that should be carried out is rebuilding public facilities, such as markets, health centers, schools, and mosques. Previously, the president had directly handed over aid for the reconstruction of 5,293 houses, which includes those heavily damaged, moderately damaged, and slightly damaged.

The Head of State asked the volunteers to help the people in rebuilding their homes. The president pointed out that the houses to be rebuilt should have earthquake-resistant structures.

"We know that West Nusa Tenggara is included in the Ring of Fire. In 1979, a major earthquake occurred here," he explained.

The reconstruction of people`s houses will be directed by the Ministry of Public Works and Public Housing and assisted by young engineers and engineering students.  To accelerate the process of rehabilitation and reconstruction, the president revealed that the government has issued the Presidential Instruction No. 5 of 2018. In the instruction, the rehabilitation and reconstruction processes will be directly led by the Ministry of Public Works and Public Housing.

"I will continue to monitor and check, so that West Nusa Tenggara will immediately return to normal, and people can continue with their economic and daily activities," he elaborated.

The Head of State appreciated the Indonesian Military (TNI) and Police members, independent volunteers, volunteers from state-owned enterprises, universities, NGOs, and local administrations for their efforts to help people in West Nusa Tenggara.

"Thank you all for working hard with high solidarity to help our brothers in West Nusa Tenggara," he remarked.

In his report, Minister of Public Works and Public Housing Basuki Hadimuljono noted that based on the Presidential Instruction No. 5 of 2018, the minister has verified 291 buildings of the 972 public facilities which will be reconstructed. The rehabilitation and reconstruction have been carried out for 56 buildings, consisting of 40 mosques, three markets, and eight hospitals and health centers.

To accelerate the rehabilitation and reconstruction of 125 thousand housing units, the minister has verified 32,800 houses, consisting of 11,400 houses with minor damages, 3,600 with moderate damages, and 17,800 with heavy damages. A sample house with earthquake-resistant technology RISHA has been built in 20 points.

In addition to Minister of Public Works and Public Housing Basuki Hadimuljono, the rally was attended by Cabinet Secretary Pramono Anung, Social Minister Agus Gumiwang, TNI Commander Marshal Hadi Tjahjanto, National Police Chief Gen. Tito Karnavian, Head of the National Disaster Management Agency Willem Rampangilei, and West Nusa Tenggara Governor Muhammad Zainul Majdi. (ant)

04
September

Indonesian Air Force (TNI) troops, along the Royal Australian Air Force personnel or "Royal Australian Air Force" (RAAF), is organizing the 2018 Rajawali Australia-Indonesia military exercise in Kupang, East Nusa Tenggara.

Director of the 2018 Rajawali Ausindo training, Colonel Pnb Reza R Sastranegara, told reporters in Kupang that the exercises, which started on Monday, would take place until Sept 27, 2018.

"This is not a combat training usually carried out, but this is a focus on the training of transport aircraft," he noted.

He explained that the aircraft used in the exercise were Hercules aircraft, both from Indonesia and from the RAAF. There are several things that will be done for about one month, starting from sharing of experiences followed by practice. The aircraft used will be operated for simulations, such as logistic drop, on land, and at sea. (ant)

04
September

BBB Rating for Indonesia

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 International rating agency Fitch Ratings maintains Indonesia`s debt rating of BBB with stable outlook rating or Investment Grade . Fitch Ratings said in a written statement, made available to ANTARA here on Monday, that the government`s debt repayment budget is low with good prospects of economic growth amid the external challenge of global uncertainties. Fitch Rating predicted that the government`s debt ratio would reach 30.4 percent of its Gross Domestic Product (GDP) by the end of 2018.

Indonesia`s debt ratio is still better than an average debt ratio of 37.7 percent recorded by other countries having equal economic capacity. The steps, taken by Bank Indonesia in raising its benchmark interest rate and aggressive intervention of the Central Bank in foreign exchange market to reduce the external pressure on rupiah, also showed strong commitment of the country to maintain stability. The aggressive intervention has reduced the country`s foreign exchange reserve by US$13.7 billion since January, 2018 to US$118.3 billion by the end of July.

"The exchange rate policy of Bank Indonesia has helped maintain stability in foreign capital inflows to the domestic market. However, rupiah is still vulnerable to market volatility especially with the widening current account deficit and high dependence on foreign capital," Fitch Ratings said.

Around 37.7 percent of the government bonds in rupiah denomination are held by foreign investors in July. Earlier, Fitch predicted that Indonesia`s foreign exchange reserve would shrink to US$109 billion by the end of this year. With the greater focus of the Central Bank on maintaining rupiah stability amid external pressure, the shrinkage of the foreign exchange reserve could be faster.

"The focus of Bank Indonesia on stability of exchange rate carries the risk of further slashing of the country`s foreign exchange reserves," Fitch said.

The international rating agency predicted that Bank Indonesia has yet to raise its benchmark interest rate by 25 basis points before the end of this year, by 50 basis points in 2019, and 25 basis points in 2020. The country`s economy is predicted to grow 5.1 percent in 2018, 5.2 percent in 2019, and 5.3 percent in 2020, mainly driven by spending on public infrastructure which the government is expected to continue. Fitch also expected that the government and Bank Indonesia would maintain stability policy ahead of the presidential election in April 2019. There is no indication of significant change in economic policy related to the presidential election.

Governor of Bank Indonesia Perry Warjiyo said affirmation of Indonesian rating of Investment Grade or BBB with stable outlook reflects the confidence of Fitch in Indonesia`s economy.

"Strong commitment in maintaining stability and strengthening economic resilience amid global uncertainties reflects credible policy of the authority," Perry said.

Fitch Ratings gave Indonesia the BBB with stable outlook rating or Investment Grade rating in December, 2017. (ant ) 

04
September

 The Association of Southeast Asian Nations (ASEAN)-led Regional Comprehensive Economic Partnership (RCEP) is the most ambitious regional trade agreement to date, covering 30 percent of both global trade and the world`s gross domestic product. To reinforce economic ties between 48 percent of the world`s population as its chief driving force, this regional grouping not only seeks to entrench itself at the heart of the Asia-Pacific economy but also stands to reap economic and political gains from the 16-member mega trade deal.

In this context, Minister of Trade Enggartiasto Lukita noted in his statement received in Jakarta on Monday that Indonesia is also contributing to the promotion of ASEAN economic cooperation with strategic partner countries, such as China, Japan, and South Korea. However, the economic cooperation between ASEAN and its strategic partners needs to be encouraged and enhanced, given the positive contribution to ASEAN`s economic integration and the ASEAN community, in general, he stressed.

The minister of trade conveyed this after attending the ASEAN meeting with partner countries held in Singapore. This meeting was a series of the 50th ASEAN Economic Ministers Meeting that took place on August 28-September 1, 2018. The RCEP will minimize these complex structural barriers by streamlining rules and procedures related to customs and trade-related infrastructure. In practical terms, ASEAN businesses will follow one set of procedures instead of having to navigate through five different sets of rules while trading with its RCEP partners.

ASEAN is again exploring economic cooperation with strategic partner countries, such as Canada, the United States (US), and Russia to encourage increased economic cooperation at consultation meetings between ASEAN and its strategic partners. These three countries have a significant contribution to the ASEAN economic integration through various work programs and initiatives though they do not have free trade agreements with ASEAN. The focus of the discussion of the ASEAN Economic Minister with Canada is the completion of the Joint Feasibility Study for the ASEAN-Canada Free Trade Agreement (Joint Feasibility Study for an ASEAN-Canada FTA).

"The results of this feasibility study are one of the references for the ASEAN and Canada to deepen their economic relations towards the establishment of the ASEAN-Canada free trade agreement. However, there are still many things that need to be done to sharpen the impact of the realization of this agreement," the trade minister explained.

Enggar, as the country coordinator, also remarked that the results of the joint feasibility study showed that the ASEAN-Canada free trade could improve economic growth and trade value of both.

In realizing the ASEAN-Canada free trade, in addition to the implementation of a joint feasibility study, the two parties also agreed to continue the implementation of exploration discussions that functioned as a forum for information exchange. In particular, regarding the level of ambition, the scope of agreement and approach adopted by both parties in negotiating free trade agreements is at a more technical level. In addition to consulting with Canada, the ASEAN economic minister also consulted with the US.

One of the initiatives lauded by the ASEAN is the US Internship Program launched in May 2018 that offers opportunities for students in the ASEAN to intern at six major US companies located in ASEAN.

"This apprentice program is beneficial for ASEAN and the US, considering that ASEAN students will have the opportunity to work in a large company, so that they can improve their skills, while US companies can get superior seeds," the minister of trade stated.

Meanwhile, at the consultation meeting with Russia, the ministers welcomed the finalization of the memorandum of understanding (MoU) on ASEAN-Eurasian Economic Commission (EEC) Economic Cooperation. This MoU is planned to be signed on the sidelines of the 33rd ASEAN Summit in November 2018 in Singapore. In addition to the signing of the MoU, ASEAN and Russia have agreed to hold a Workshop "Regional Economic Integration in the Eurasian Economic Union and ASEAN" at the end of 2018 in order to provide an understanding of the economic integration of the two regions.

In the series of meetings of the ASEAN economic ministers, the ASEAN Economic Ministers together with the economic ministers of Australia, China, India, Japan, South Korea, New Zealand, the Russian Federation, and the US also met and exchanged ideas on common challenges faced in the economic field in the future. The meeting was packaged in the 6th Economic Minister of the East Asia Summit (EAS) working lunch format

On the occasion, the ministers conveyed congratulations to the Economic Research Institute for ASEAN and East Asia (ERIA) on the occasion of the 10th anniversary celebrations and welcomed the report of the 11th ERIA Governing Board Meeting and lauded the contribution of ERIA in supporting regional economic integration.  (ant)