THE
COORDINATING MINISTRY FOR ECONOMIC AFFAIRS
Tel: (021) 351-1178 Fax: (021)
351-1186 Website: http://www.ekon.go.id
Trade and
Investment News[1], 18 August 2009
Highlights
National
·
Government
to review regional autonomy, president calls for moratorium
Politics
·
Constitutional
Court throws out vote manipulations cases, confirms president’s re-election
Terrorism
·
President
tells nation to be on alert, stresses attacks won’t bow
Security
·
Extra
troops deployed to
Law & order
·
Trials
of five charged in killing of state-owned sector businessman to begin
Health
·
Women
at risk from AIDS, global conference in
Economy
·
President,
promising new reforms, says
·
Finance
minister says domestic economy to be focus of policy
Business briefs
Macroeconomy
·
Bank
·
Minimum
deposit guarantee rate falls in line with benchmark rate
Investment
·
Low
investment remains a concern, coordinating economics minister admits
·
Coca-Cola
Amatil to boost activities in
State concerns
·
Manufacturing
output slows in second half due to economic crisis
·
Trade
minister looks to doubling trade with
SOEs
·
Government
calls for higher dividends as tax revenue falls
·
State
aircraft maker to deliver four aircraft to
Private sector
·
Shoe
companies defy global downturn, book stronger orders
·
BNI
Securities sees more than four-fold increase in trading
Banks
·
Bank
Mandiri projects 20% loan growth next year
Power
·
State
utility makes major savings on switch to cheaper fuels
Oil & gas
·
PT
Pertamina seeks bigger role in planned refinery in Banten province
Mining
·
Government
to buy 14% Newmont stake for $493.6 million
NATIONAL
‘Failing’ regional autonomy policy to be reviewed
The Ministry of Home Affairs said it was examining the
effectiveness of decentralization and preparing new rules on how regions should
manage their finances, The
The announcement comes amid rising concerns about the impact
of giving greater autonomy to regional authorities.
The Law on Regional Autonomy, adopted by the government in
2004, provides a legal basis for local authorities to manage their own budgets,
as part of efforts to accelerate local development.
More regions are trying to benefit from the policy, which
has led to the establishment of 205 new regional administrative entities,
including provinces, districts and municipalities but many believe it has
failed to spur regional development.
Former Home Affairs Minister Ryaas Rasyid, one of the
architects of regional autonomy, said the prosperity promised many regions has
failed to materialize. “Poverty rates have not dropped significantly and
unemployment has increased,” he said.
President Susilo Bambang Yudhoyono also indicated his
displeasure over decentralization during his budget presentation to the House
of Representatives this month, when he called for a moratorium on the
establishment of new regions.
The Supreme Audit Agency last week told the government that
only eight of 500-plus autonomous regions had produced positive financial
reports.
Ministry of Home Affairs spokesman Saut Situmorang said the
government now planned to evaluate the effectiveness of the policy in newly
created regions.
He said the ministry would review demands for autonomy from
several proposed regions. “We’re developing a master plan on the ideal number
of regions in
National flags adorn Aceh on peace deal anniversary
Red and white flags decorated buildings, homes and vehicles
in Aceh during Saturday’s celebration of the four-year historic peace agreement
between the Indonesian government and the Free Aceh Movement (GAM),
highlighting progress made in the former war-torn province, The Jakarta Post reported.
The anniversary of the memorandum of understanding signed in
Thousands of Acehnese took to the streets around the
Baiturrahman Mosque with red and white flags, many flocking from outside the
capital, reported Antara.
In the past, red and white flags were common in Aceh ahead
of the country’s independence celebrations every August 17, but the strong
presence of security forces made people fearful of not displaying the national
flag.
Fear of GAM was blamed for reluctance to sing the national
anthem “Indonesia Raya” in rebel areas.
However in the July presidential election President Susilo
Bambang Yudhoyono gained an overwhelming 93.99% of votes in Aceh, which many
attribute to his image as the figure most responsible for the peace following
four decades of war.
Sandino, the chairman of the Acehnese Ethnic Groups
Association, said the peaceful conditions in Aceh have helped the
reconstruction process in the province after the 2004 tsunami.
“The peace agreement has further encouraged our brothers and
sisters in other regions and countries to help us and we are grateful for
that,” he told a gathering.
Ministry official Firmansyah said all incoming flights and
all hotels in
Sail Bunaken, funded by the government to the tune of Rp30
billion ($3 million), as part of attempts to establish Manado as an
international tourist destination to rival Bali, kicked off last Wednesday and
ends on Thursday.
It features a fleet review involving more than 40 warships
from
In addition, the USS
George Washington super carrier will participate, in addition to three tall
ships and 165 yachts from almost 30 countries. An attempt will be made for the
world’s biggest joint dive, with some 2,000 divers camped out in ships and
houses in Manada for the attempt.
Sail Bunaken will also feature international seminars on
illegal and unregulated fishing practices.
POLITICS
Court
rejects vote challenge
The
Teams representing the incumbent’s opponents, former
President Megawati Sukarnoputri and Dr. Yudhoyono's current vice president,
Jusuf Kalla, claimed the July 8 presidential election was flawed due to severe
mismanagement of voter lists.
The court said it could find no reason to order another poll
as there was no significant evidence of systematic and massive violations
committed by the General Election Commission (KPU), the defendant in the
lawsuit, in favor of Yudhoyono’s side.
"Based on all evidence and laws, we reject all
complaints filed by the plaintiffs," Court chief Mahfud MD said while
delivering the ruling.
Nine court judges unanimously agreed that allegations put by
campaign teams for Megawati and Kalla of voter list irregularities, vote
manipulation, regrouping of polling stations and foreign involvement in vote
counting lacked evidence and had not be proven.
The court agreed that KPU made several procedural mistakes
that led to allegations of vote rigging in 25 provinces. However, they could
not be proven to be more than mistakes and there was no reason to order new
elections in the provinces.
The General Election Commission’s (KPU) official final vote
count showed Dr. Yudhoyono secured his re-election with 60.8% of the vote
followed by Megawati with a distant second with 26.8%. Kalla trailed with a
mere 12.4%.
The KPU said it would issue a ruling to declare the official
winner from the presidential election following the court's verdict on the
election disputes in a plenary session later this week.
Golkar to hold early congress as Bakrie strengthens claim
The Golkar Party on Thursday agreed to hold its national
congress, which will be critical in deciding the party leadership and political
position for the next five years, in Pekanbaru, Riau, in early October instead
of December as initially scheduled, Antara reported.
Golkar chairman and Vice President Jusuf Kalla confirmed the
decision after the conclusion of a two-day meeting of the party’s provincial
chapters.
Four party members have already declared their candidacy for
the chairmanship: advisory board member and Coordinating Minister for People’s
Welfare Aburizal Bakrie, advisory board chairman and media mogul Surya Paloh
and two up-and-coming young Golkar members, Yuddy Chrisnandi and Ferry
Mursyidan Baldan.
An October congress, analysts say, will give Bakrie the
advantage because he has already secured the backing of most of the provincial
chapters, while the other candidates do not have enough time to drum up support
for their bids.
Kalla said that as long as the current administration was in
office, until October 20, Golkar will continue to remain a government
supporter, but after that “there will be new leadership that will determine the
party’s stance.”
Following the party’s heavy losses in this year’s
legislative and presidential elections, Golkar is under pressure to decide
whether it will continue to support the government or join the opposition.
Analysts say that under Bakrie, Golkar will remain firmly
behind the new government of President Susilo Bambang Yudhoyono.
TERRORISM
SBY defiant as Ritz bomber identified, e-mail probed
President Susilo Bambang Yudhoyono sent a message of
defiance Friday to extremists, saying
In an address to the nation ahead of Independence Day, Dr. Yudhoyono
called on all Indonesians to remain vigilant against extremists blamed for a
series of attacks including last month's hotel blasts in
Police hunting Islamist fanatic Noordin M. Top, who
allegedly ordered the July 17 suicide attacks on the JW Marriott and
Ritz-Carlton hotels, announced they had killed three men involved in the
assassination plot.
"In this planned terrorist attack there is a new
phenomenon which is to aim terrorist action directly at our country, including
a plan to assassinate the head of state," the president said. "I want
to stress that our country cannot be defeated in the fight against
terrorism."
Police are also investigating an email sent to a local
website claiming to be from Top and threatening to carry out more attacks.
Police initially thought they had killed Top during raids in
National Police chief Bambang Hendarso Danuri said
authorities were investigating the email sent to local website Bagustv.com
which claimed that the militant had been at the scene of Friday's raid in
Temanggung,
"I could escape the police siege," the email said.
"I will never give up before
An internet posting last month, also purporting to be from
Top, claimed responsibility for the
Two suicide bombers believed to be part of Top’s network
killed seven people at the Marriott and Ritz-Carlton in downtown
Dr. Yudhoyono said "poverty and injustice" were
the root causes of terrorism but the killing of innocent civilians could never
be justified by religion.
"Terrorist acts in public places are inhuman and the
victims are innocent, whether they are foreigners or Indonesians," he
said.
"I urge the police and other security apparatuses to
increase their vigilance to prevent and eradicate terrorism at its roots,
whoever they are and whatever their motivation."
He also called on ordinary Indonesians -- the vast majority
of whom are moderate Muslims -- to "stay united" against religious
fanaticism.
"Let's protect our young people from the deviant and
extreme way of thinking, which can lead to terrorist acts," he said.
SECURITY
Extra
troops deployed to
The Tanjungpura Military Area Command in East Kalimantan has
deployed 650 personnel from the 611/Awanglong Infantry Battalion to the
The 650 personnel departed from Samarinda on August 12
aboard KM Tidar and were scheduled to
stop at Tarakan before arriving at Nunakan.
Maj. Achmad Amin said the troops would be tasked to protect
areas near the disputed Unarang Reef in the Ambalat Block as well as general
security in response to terrorism developments.
Nunukan regency in East Kalimantan is a major transit area
for members of the Jemaah Islamiyah (JI) terrorist network, JI’s former
Abbas said Nunukan is favored by militants because it
directly links
“Aside from being strategically located, security in Nunukan
is lax compared to neighboring regencies,” he said.
In
According to Panju Panjung Army commander Col. Rudiono Edi,
Battalion 632 Panglima Batur will be based in Muara Teweh, North Barito regency
with 1,000 soldiers while Battalion 633 will be based in Pangkalan Bun,
Edi also said the Army will also create a district military
base in Gunung Mas regency and a sub-district military command in Murung Raya
regency.
The creation of the new battalions and bases is aimed at
protecting the sovereignty of
LAW & ORDER
Zulkarnaen
murder trial to begin under tight security
Five suspects in the murder of Nasruddin Zulkarnaen, the
former director of state-owned PT Rajawali Putra Banjaran, will stand trial in
Tangerang, Banten this week after prosecutors submitted the defendants'
dossiers to the Tangerang District Court, Detikcom reported.
"The defendants, Fransiscus Tadin Keran, Daniel Daen,
Hendricus Kwa Walen, Heri Santoso and Eduardus Ndopo Bete will be tried in
three separate hearings starting on August 18," court spokesman Arthur
Hangewa said.
The defendants will be tried in three separate courtrooms.
The suspects are charged with violating Articles 338, 340
and 55 of the Criminal Code on premeditated murder and could face the death
penalty if found guilty.
Nasruddin, 41, was shot in the head in a drive-by shooting
as he left the Modernland golf course in Tangerang on March 14.
The murder has become the focus of intense media attention,
having led to the arrest of suspended chairman of the Corruption Eradication
Commission Antasari Azhar, as well as media businessman Sigid Haryo Wibisono
and former Tangerang and South Jakarta Police chief Sr. Comr. Wiliardi Wizar.
HEALTH
50M
Asian women at HIV risk from partners: UN
More than 1.5 million women with HIV in
The "HIV Transmission in Intimate Partner Relationships
in
"That is, men who have sex with men, injecting drug
users, the clients of sex workers," UNAIDS regional director Prasada Rao
said in a report from Agence France Presse.
"(It's) a problem of great magnitude that the countries
have largely ignored (and) a challenge that we may no longer ignore," Rao
said on the sidelines of the ninth International Congress on AIDS in Asia and
the Pacific in
Women accounted for 35% of all adult HIV infections in
In
"The facts speak for themselves. It is estimated that
more than 90% of the 1.7 million women living with HIV in
ECONOMY
Second
round of reform needed: President
Indonesia needs to embark on a second wave of reform that
will accelerate Indonesia’s pace of development, President Susilo Bambang
Yudhoyono said in his State of the Nation address on Friday, Kompas reported.
While the first wave of reform beginning with the end of the
Suharto era had concentrated on issues such as fighting corruption,
establishing the rule of law and ensuring free and fair elections, Yudhoyono
said the second wave would focus more on the economy.
“The essential part of the second wave of reform aims to
free
The government, Yudhoyono said, will depend on the domestic
economy to boost growth and reduce the country’s dependence on exports, The Jakarta Globe reported.
“Looking forward, we have to strengthen domestic markets and
not depend only on exports as our growth source,” the president said. “Therefore,
an export-oriented strategy is not our choice.”
“
Finance Minister Sri Mulyani Indrawati, elaborating later on
Yudhoyono’s remarks, said domestically driven growth that took advantage of the
country’s large population had become more important amid the global slowdown
and as capitalism was in the process of redefining itself.
According to Indrawati, many nations had adopted a cautionary
stance to economic excess in order to protect their domestic interests.
“We have to guard ourselves with sound regulation and good governance,”
she said. “We need a balance between capitalism and an effective government
role.”
Indrawati said the government, for example, would need to effectively
supervise the nation’s financial system and create a mechanism to combat
cartels and monopolistic practices in the domestic market.
Indrawati
also expressed optimism that the country's economy will grow by more than 4% in
the third quarter of 2009, driven by stronger exports, imports and investment
flows, Asia Pulse reported.
Exports,
imports and investment in the third quarter would most likely grow at a faster
pace than in the second quarter, she said.
"It is
expected consumption growth will remain good and investment flows will also be
better," she said.
The
Central Bureau of Statistics (BPS) said on Monday the economy grew by 4% in the
second quarter of 2009 from the same period a year ago. The figure exceeded
Bank
On-quarter, the economy grew 2.3% thanks to election-related
spending, stronger than the revised growth of 1.7% in the January-March
quarter.
BPS said household consumption, which typically accounts for
around 60% of gross domestic product, rose 4.8% on year in the second quarter,
and 0.2% compared to the previous quarter.
Exports declined 15.7% on-year but expanded 7.4% on-quarter,
Agence France-Presse reported.
BUSINESS BRIEFS
MACROECONOMY
BI
sees 2009 inflation below 4%
Bank
"At
the end of the year, inflation may be below 4%," Nasution told reporters.
Nasution
declined to comment on any implications of the forecast on the central bank's
overnight policy rate, which currently stands at 6.5%.
LPS cuts maximum rupiah deposit guaranteed rate
State-owned Deposit Insurance Corporation (LPS) has cut the
maximum interest rate for guaranteed rupiah deposits by 25 basis points to
7.25%, Dow Jones reported.
According to the LPS Web site on Tuesday, the rate for
deposits denominated in US dollars remains at 2.75%. The rates are valid until
September 14, it said.
The move followed Bank
BI
targets Rp2T debt sale
The
government plans to raise Rp2 trillion ($201.4 million) from the sale of
government debt on August 18, Rahmat Waluyanto, Director General of Government
Debt Management at the Finance Ministry, said on Thursday.
Meanwhile,
Bank Indonesia (BI) absorbed Rp1 trillion ($100.8 million) through its 21-day
reverse-repo auction on Thursday, halving its Rp2 trillion target.
BI also held
63-day reverse-repo auction, but received no bids.
INVESTMENT
Low investment growth a concern: Minister
Low levels of investment remain a concern for
"What needs to be monitored is investment growth, which
is quite low compared to levels in 2008," Indrawati said.
However, both import and export growth should pick up during
the second half of the year, she said, noting "signs of recovery."
Investment grew 2.7% on-year between April and June,
official data showed.
Coca-Cola Amatil to increase
Coca-Cola Amatil Ltd will increase production capacity in
The company will increase its investment in cold drink
coolers for
The company said
Coca-Cola Amatil Asia managing director Peter Kelly said
this type of profitable growth was a prerequisite for the company to increase
its capital investment to meet higher demand.
"This double-digit earnings growth places
Kelly said the company expected further record earnings in
Indonesia, with 2009 local currency earnings expected to be 50% higher than
2007.
STATE CONCERNS
Manufacturing
sector Q2 growth slows
The
manufacturing sector grew at its slowest rate in the second quarter of this
year since the start of the economic crisis, The Jakarta Post reported.
Out of
eight specific product categories monitored by the Central Bureau of Statistics
(BPS), the wood- and forestry-based products suffered the most, with the value
of output contracting by 3% in three months, prolonging an earlier 3.6% slump
in the first quarter.
Paper and
printed goods grew at a snail's pace, by 1.4%, as opposed to the 10% growth
recorded in the first quarter.
Among the
product categories that saw a steady though low growth was base metal iron and
steel, with growth inching slightly higher to 3.2% after registering 2.9%
growth in the first quarter. The food and beverages category also grew, 1.42%
higher than in the first quarter.
With the
ninth product category - other types of manufacturing products - contracting by
7% in the second quarter, the total output of the manufacturing sector grew by
1.85% to Rp327.7 trillion ($33.1 billion), relative to the total value in the
first quarter.
"The
third quarter of this year is expected to see industrial growth of 2.2%,"
Industry Ministry secretary general Agus Tjahjana told reporters on Thursday.
He said
three industries would support the 2.2% growth forecast in the next quarter,
namely the food, beverage and tobacco industry, the fertilizer, chemistry and
rubber-made goods industry and the transportation, machinery and tools
industry. The three categories control, on average, 69% of the total output
value each year.
"On
the external side, the unemployment rate in the
Indonesia, India trade to double in five years: Minister
Indonesian trade with India is expected to double to $20
billion within five years, boosted by the signing of a free trade agreement (FTA)
between India and the Association of Southeast Asian Nations (ASEAN), Trade
Minister Mari Pangestu said Friday, Dow Jones reported.
"It should rise not just because of the FTA but because
of
She said the FTA would also lift Indonesian coal exports to
Pangestu said the FTA would also deliver tariff cuts on palm
oil and refined palm oil - currently with tariffs of up to 90% and 80%
respectively. They will be reduced to 40% and 35% by 2019.
"For us it should be beneficial because you're talking
about high tariffs coming down," she said, adding
The India-ASEAN agreement signed in Bangkok on Thursday is
due to come into effect on January 1 and will lift import tariffs on more than
80% of traded products between 2013 and 2016.
The minister said trade between
Pangestu said
Forex gains from tourism expected to drop to $6.5B
Foreign exchange gains from the tourism industry are
expected to drop by 16.5%, to $6.5 billion, compared to last year due to the
global economic slowdown and last month's terrorist bombings, The Jakarta Post reported.
Minister of Culture and Tourism Jero Wacik said Tuesday the
situation was not conducive for tourism and had forced the ministry to set its
targeted number of foreign tourists at its minimum level of 5.5 million.
According to Ben Sukma, president of the Association of the
Indonesian Tour and Travel Agencies (ASITA) and chairman of the ITTF's
organizing committee, Malaysian, Australian, Japanese and Chinese tourists
would dominate the ranks of foreign visitors coming to the country this year.
Executive director of the Indonesian Hotel and Restaurant
Association (PHRI), Carla Parengkuan, said hotel occupancy rates might stay at
last year's figure of 60%.
"An increase can still occur, as foreign countries have
many holidays in the second semester, including school and year-end
holidays," she said.
El Nino expected to cut CPO output by 1M tons
The El Nino phenomenon is expected to reduce
"Currently, we haven't yet felt the impact of El Nino.
We still have rain in palm plantations," Derom Bangun, head of the
Indonesian Palm Oil Businessmen Association, told reporters.
He said he expected
Bangun said that the production decline would increase the
price of the commodity around 20-30%.
According to the association's data, in the first half of
2009
He added that the rise in price of crude oil to $70 per
barrel was an indication that the global economy has started to roll, which in
turn would increase the CPO price.
"We have already seen increasing demand from several
importer countries," said Bangun, without elaborating.
SOEs
Higher
dividends demanded from SOEs
The State
Ministry for State Enterprises will ask state-owned companies to increase
dividend payment to help plug this year's state budget deficit, The Jakarta Post reported.
To help
cover the budget deficit, the dividend from state firms has been increased by
Rp2.5 trillion (about $250 million), from Rp26.1 trillion to Rp28.6 trillion.
"We
plan to send letters to state companies asking for an extraordinary
meeting," secretary to the state ministry Said Didu told reporters on
Thursday.
The
meeting will discuss ways to come up with an additional Rp2 trillion worth of
dividends, as Pertamina has already been asked for Rp500 billion to help cover
the Rp2.5 trillion shortfall.
"We
will invite some listed companies to attend the meeting as well," he said,
adding the state ministry would collect additional dividend from companies in
various business sectors that were profitable and had adequate cash balances.
Didu
added the state ministry had selected several companies that could give more
dividends, but he refused to give names as the companies had not been
officially notified.
Between
January and June, total revenue from taxes reached Rp253.18 trillion, about
2.83% less than the Rp260.56 trillion recorded in the same period last year.
The figure represented 43.07% of the tax office's estimated full-year tax
revenue.
Pertamina
is one of the most profitable state companies, contributing about half of the
total dividend collected from all state companies annually.
PT DI to deliver four CN-235 planes to
State-owned aircraft manufacturer PT Dirgantara
"
Countries already using CN-235s are
The firm also produces Super Puma NAS-332 helicopters under
a license from
PRIVATE SECTOR
Shoe makers get larger orders from foreign buyers
Shoe makers in
Orders rose 10% for delivery in September prompting
producers to plan a 15% increase in production that started in July,
association secretary general Binsar Napitupulu said. Large orders came from
Europe and the
In the first half of the year, the country's shoe exports
sank 2% to $882 million from $900 million in the same period last year, data at
the association show.
Earlier
Lacoste said it was studying cooperation with eight shoe
factories in
BNI Securities posts 455% increase in transactions
BNI Securities chalked up a 455% increase in business
transactions it handled to Rp3.8 trillion ($380 million) in July 2009 from a
year before, Asia Pulse reported.
Company president Eddy Siswanto attributed the improved performance
partly to on-line trading launched in August 2008 to facilitate transactions.
Frequencies of transactions handled by the subsidiary of
state Bank Negara Indonesia (BNI) surged 670.3% to 192,695, Investor Daily reported.
"The facility has succeeded in attracting more
customers, now already more than 5,200 from 1,415 a year before," he said.
He said the on-line service, Esmart, is expected to
contribute 50% to the total income of the company, which also earns fees as
underwriter, investment manager and financial advisor.
The company hopes to post Rp15 billion in net profit this
year.
Intraco mulls rights or bond plans
Publicly listed heavy equipment financing and leasing
company PT Intraco Penta said it may launch a rights issue or issue bonds to
raise funds to finance its business expansion, Asia Pulse reported.
The company hopes to raise up to $50 million either through
the sales of rights shares or bonds or both, finance director Fred Lopez
Manibog said.
Manibog said a rights issue might be the choice as the
process would not require large costs, and in addition, larger shares traded in
the market could make the company more liquid.
Meanwhile, its subsidiary, PT Intan Baruprana Finance, is
seeking a loan of Rp200 billion ($20.2 million) to strengthen its financing
capacity for heavy equipment, Investor
Daily reported.
Excelcomindo H1 profit rises
The country's third largest cellular phone operator PT
Excelcomindo Pratama said Monday its first-half net profit rose 12% on year due
mostly to gains from telecommunication equipment leasing transactions, Dow
Jones reported.
Net profit for the first six months of 2009 rose to Rp706.38
billion from Rp631.27 billion a year earlier.
Operating revenue grew by 7% to Rp6.25 trillion from Rp5.84
trillion a year earlier.
The company said that the slight increase in operating
revenue, however, was offset by higher operating costs, which rose 19% to
Rp6.46 trillion from Rp5.41 trillion a year earlier.
Its operating profit fell 41% to Rp749.27 billion from
Rp1.28 trillion a year earlier.
Excelcomindo said gains from leasing telecommunication
equipment of Rp463.90 billion, compared with zero in the previous year, drove
net profit higher.
BANKS
BRI
maintains lead in H1 credit expansion
State-owned
Bank Rakyat Indonesia (BRI) maintained its lead in credit expansion and its position
as largest lender in the first half of this year, Asia Pulse reported on Friday.
BRI disbursed
Rp48.46 trillion ($5 billion) in new credits in the first six months of this
year increasing its total outstanding credit to Rp184.6 trillion by June.
Second in
the ranks was another state-owned bank, Bank Mandiri, with new credit amounting
to Rp29.68 trillion with outstanding credits at Rp162.49 trillion by June
CIMB
Niaga, which is only the sixths in assets in November 2008, recorded the third
largest credit expansion with disbursement of Rp26.04 trillion in the six
months period.
The new
credit brought CIMB Niaga's credit outstanding to Rp72.06 trillion increasing
its position to the fifth largest lender from the sixth earlier.
Other top
lenders after BRI are Bank Mandiri, Bank Negara
Latest data from Bank Indonesia revealed bank lending
experienced relatively sluggish growth during the first semester and expanded
by just 2.09% to Rp1,335.04 trillion in June from Rp1,307.69 trillion in
December last year, The Jakarta Post
reported.
This minimal growth has forced BI to change its forecast for
lending growth this year from about 15% to 12%, based on the banks’ business
plan, BI deputy governor Budi Mulya has said.
Between last December and June, consumer loans experienced
the greatest increase of 6.74% from Rp367.12 trillion to Rp391.85 trillion,
while investment loans grew by 5.11% from Rp255.9 trillion to Rp268.98
trillion.
Mandiri targets 20% loan growth next year
State-owned lender PT Bank Mandiri targets loan growth of at
least 20% next year and at least 25% in 2011, compared to the 16% forecast for
this year, chief financial officer Pahala Mansyuri told reporters Tuesday, Dow
Jones reported.
He said Mandiri aims to maintain its capital adequacy ratio
at between 12% and 15% over the next two years. The ratio stands at around 14%
currently.
Mandiri has previously said its outstanding loans totaled
Rp56 trillion at the end of June.
The bank also plans to issue subordinated debt denominated
in both rupiah and dollars by the first quarter of next year and possibly as
early as the fourth quarter of this year, Mansyuri said.
HSBC lifts stake in Bank Ekonomi to 98.96%
HSBC Holdings said on Wednesday it had completed a mandatory
tender offer and bought an additional 10.08% stake in PT Bank Ekonomi Raharja,
raising its stake in the bank to 98.96%, Reuters reported.
"The acquisition almost doubled HSBC's presence to 208
outlets in 26 cities in the country," HSBC said in the statement.
HSBC said it had bought 269.01 million shares of Bank
Ekonomi held by the general public for Rp713.4 billion ($71.98 million).
HSBC had in May set a tender offer price of Rp2,652 per
share for the remaining shares in Bank Ekonomi Raharja.
New directors, commissioners at Permata Bank
Permata Bank's shareholders on Wednesday appointed David
Martin Fletcher of Standard Chartered as its new president director to succeed
Stewart Hall, who will resign shortly, The
Jakarta Post reported.
The shareholders also approved the shifting of M.
Herwidayatmo, currently director of legal & compliance, to the post of vice
president director.
Joseph Georgino Godong, currently director of technology and
operations, was appointed to the director of compliance position while David
Allen Worth, currently a member of the board of commissioners, will replace
Peter B. Stok as the independent commissioner for the company.
All of the appointments will need Bank
POWER
PLN expects to save Rp10T in fuel costs
State power company PT PLN expects to save Rp10 trillion in
fuel costs when its first-phase "crash program" power plants comes on
line with its full 10,000 MW boost to capacity, Antara reported.
Most of the power plants will start operating next year, PLN
president director Fahmi Mochtar said on Tuesday.
"In 2009, three of the 35 thermal power plants will
start operations," he said.
The cut in fuel costs would result from the difference in
prices between coal and fuel oil, he said.
He said the operation of the power plants would also help
PLN reduce the number of power cuts in several parts of the country.
Pertamina may spend $3B for geothermal power plant
State-owned oil and gas company PT Pertamina may spend $3
billion on building geothermal power plants to meet the country’s growing
electricity demand, Bloomberg reported.
Pertamina plans to construct geothermal plants with a total
capacity of 1,000 MW within five years, Abadi Purnomo, president director of PT
Pertamina Geothermal Energy (PGE), a Pertamina subsidiary, told reporters in
Jakarta Thursday.
“We will seek commercial loans of $800 million to $1
billion,” Purnomo said, adding that the company is also in talks to borrow from
the World Bank.
PGE may spend $400 million to drill 35 new geothermal wells
this year and next, Purnomo said.
OIL & GAS
Pertamina seeks majority stake in Banten refinery
State-owned oil and gas company PT Pertamina is considering
taking a majority stake in a $3 billion joint venture with Iran and a Malaysian
firm to build an oil refinery in Banten, Pertamina president director Karen
Agustiawan said on Thursday, Reuters reported.
Pertamina signed a preliminary deal last year to build a
refinery in which it and the National Iranian Oil Refining and Distribution
Company would take 40% stakes, with 20% for a Malaysian partner, Petrofield.
Agustiawan said the firm had been asked by the government to
take the main stake in the project.
"This is related to ensuring security of supply of
national oil products," she told
reporters.
"Hopefully this refinery will be on schedule," she
said.
The refinery, which is due to come on stream in 2015, would
have a capacity of 150,000 barrels per day (bpd) in the first phase.
Originally, Pertamina had planned to build a 300,000 bpd
refinery with
PLN ready to buy Donggi-Senoro gas
State power company PT PLN is ready to buy liquefied natural
gas (LNG) to be produced at the Donggi-Senoro refinery in
PLN has no objection to buy Donggi-Senoro gas at market
prices, provided the purchase is based on a mutually beneficial contract, Fahmi
Mochtar said.
"This means that PLN will not buy gas at higher prices
while on the other hand the gas producer will receive fair profit
margins," he said, adding PLN had so far bought gas at market prices.
PLN has been facing a huge shortage of gas supplies and the
Donggi-Senoro refinery is one of the alternative gas suppliers, he said.
Energy and Mineral Resources Minister Purnomo Yusgiantoro
had asked a consortium of companies that would develop the project to seek
domestic buyers for the Donggi-Senoro gas.
The consortium consists of
Japan Gasoline to build CWM plant in Jambi
Japan Gasoline Corp. (JGC) will build a coal water mixture
(CWM) factory with an annual production capacity of 10,000 tons at a cost of
$27 million in Jambi, Asia Pulse reported.
JGC will build the factory to produce CWM used as a
substitute for marine oil or industrial diesel oil, head of research and
development at the Energy and Mineral Resources Ministry Bukin Daulay said.
Daulay said the factory is scheduled to be operational in
2011.
Based on a survey, there are 46 industries in the country
seen as potential users replacing fuel oil with CWM, which is cheaper in price,
Daulay said.
CWM is produced from low-grade coal mixed with water and
some additives, Investor Daily
reported.
TPPI to build $500M petrochemical plant
Producer of upstream petrochemicals PT Trans Pacific
Petrochemical Indotama (TPPI) plans to invest $500 million in a new
petrochemical project in
The company wants to build a new production unit for
paraxylene with an annual production capacity of 600,000 tons at its complex in
Tuban, TPPI president Amir Sambodo said Wednesday.
The new unit will expand the production capacity of the
government-controlled company for paraxylene from 550,000 tons at present.
TPPI is seeking cooperation with state oil and gas company
PT Pertamina in building the project starting next year, Sambodo said, adding
if Pertamina agrees, work could start on the aromatics plant early 2010.
The company has already secured a commitment from Qatar Gas,
the world's largest LNG producer, to supply it with the feedstock in
condensate, he said.
Pertamina has a production capacity of 220,000 tons a year
from its Balongan plant, Investor Daily.
Hess to drill exploration well in Papua next year
US firm Hess Corp will drill at least one exploration well
in Papua next year, an official at Energy and Mineral Resources Ministry said
on Tuesday, Reuters reported.
"We hope Hess will succeed in finding oil or gas
there," Edy Hermantoro, director of Upstream Activities at the ministry
told reporters.
The government has awarded Hess Semai V, an offshore block
west of Papua last year.
Salamander’s
Independent
oil and gas producer Salamander Energy Plc said on Thursday the South Sebuku-1
(SS-1) exploration well in
"We
are pleased to have made a discovery which we expect to lead to our second
development in the
Salamander
holds a 25% interest in the Bengara I Production Sharing Contract, where the
SS-1 well is located, with operator PT Medco holding 35% and PTT a 40% stake.
The
Bengara I partners are in talks with the authorities regarding appraisal
drilling on the
The
partners are evaluating the potential for tying in South Sebuku to the
"With
gas sales arrangements in place, we can proceed with appraisal and development
work with a view to bringing new source production on-stream in 2011,"
said Menzies.
MINING
Govt. to buy 14% Newmont stake for $493.6M
The government will buy nearly $500 million of shares in PT
Newmont Nusa Tenggara, which has to be sold under a divestment rule by an
international arbitration court, Finance Minister Sri Mulyani Indrawati said on
Wednesday, Reuters reported.
The government will buy a 14% stake which is due to be sold
in two tranches in 2008 and 2009 and worth $493.6 million, Indrawati said. She
declined to say how the government would finance the purchase.
Energy and Mineral Resources Minister Purnomo Yusgiantoro
said earlier on Wednesday if the government went ahead with the purchase it
could assign state-owned mining company PT Aneka Tambang (Antam) or the
government investment body Pusat Investasi Pemerintah (PIP) to hold the shares.
PT NNT had not been notified which party appointed by the
government would buy the shares, spokesman Rubi Purnomo said in an email,
adding the firm remained "committed to divestiture requirements".
Under the terms of the contract, foreign investors in PT NNT
must sell 51% of their shares to local investors.
PT Pukuafu Indah, an Indonesian mining group, previously bought
20% of the unit, while Newmont and
Indo Tambangraya posts 128% net profit rise
The net profit of PT Indo Tambangraya Megah jumped 128.74%
year-on-year to $158.7 million in the first half of this year, Asia Pulse
reported.
The operating profit of the subsidiary of
Earlier, its president Somyot Ruchirawat said the company
was negotiating acquisition of a coal mining company to increase its coal
production in
Indo Tambang is set to chalk up a 13.2% increase in coal
sales to 20.5 million tons this year from 18.1 million tons last year, Investor Daily reported
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[1] This Trade and Investment News is a publication of the Coordinating
Ministry for Economic Affairs of the Republic of Indonesia. Readers are
welcomed to forward it in its original form but no reproduction is allowed without
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