Day: February 8, 2022

Indonesia is seeking collaboration among G20 member nations for pushing breakthroughs and concrete action in the industrial, trade, and investment sectors to support post-pandemic global economic recovery, Industry Minister Agus Gumiwang Kartasasmita has said.

“We invite the members of the G20 to collaborate on overcoming the challenges caused by the pandemic and formulate strategies to achieve inclusive and sustainable industrial growth to create a stronger economy,” Kartasasmita remarked while attending the G20 Trade, Investment, and Industry Working Group (TWIIG), on Tuesday.

This will allow the G20 countries to be better prepared for facing various crises in the future, related to both economy as well as health, he added.

Kartasasmita said that the TWIIG forum is being held for the first time as part of the 2022 G20 event and has been initiated by the Indonesian government.

“For the first time, industrial issues are being discussed specifically at the G20 through TWIIG,” he noted.

Moreover, the industry is one of the main contributors driving economic growth in several countries, which have also been affected by the COVID-19 pandemic, he said.

Industry, trade, and investment are three important pillars of economic growth in many countries, he added.

“The investment sector is the upstream, industry is intermediate, and trade is the downstream. So, these are three important pillars of our economic development,” he remarked.

The Ministry of Industry has been assigned to facilitate discussions at the TWIIG forum on strengthening Industry 4.0 to spur economic recovery, the minister said.

“We will ask the G20 countries to accelerate the absorption of technology, especially in Industry 4.0, in order to create a global economic recovery,” he emphasized.

He said that the step is important since it has the potential to increase productivity and create inclusive and sustainable industrial growth, in line with the Sustainable Development Goals (SDGs).

“This will provide a good opportunity to all G20 members to implement a sustainable economy,” he added.

Source: Antara News

The East Java provincial government has asked cooking oil distributors to help accelerate the distribution of subsidized cooking oil to all modern, retail, and traditional markets. Governor Khofifah Indar Parawansa said there has been a cooking oil shortage ever since the central government set the highest retail price (HET) of cooking oil at Rp14 thousand per liter.

“Apart from the high interest of the public to get affordable cooking oil, the scarcity might happen due to delays in the delivery from distributors,” Parawansa noted in a press statement here on Tuesday.

Accompanied by Brawijaya Regional Military Commander, Major General Nurchahyanto, and East Java Regional Police chief, Inspector General Nico Afinta, Parawansa visited a cooking oil production facility, PT Wilmar Nabati Indonesia, in Gresik to ensure cooking oil supplies for the community.

“The scarcity of cooking oil should not happen in East Java considering that the cooking oil needs in this province are around 59 thousand tons per month. This should meet with the factory production capacity of 62 thousand tons per month. There is a three thousand-ton surplus,” she remarked.

However, the Governor said that during her visit to modern retail stores, she found that many stores had not received cooking oil for almost a week.

This condition is hindering people from getting cooking oil at the price set by the government, Parawansa said.

The government set the HET for cooking oil on February 1, 2022. The price of premium packaged cooking oil has been set at Rp14 thousand per liter, simple packaged cooking oil at Rp13,500 per liter, and bulk cooking oil at Rp11,500 per liter, she noted.

Supply chains are important for controlling cooking oil prices in the market, the Governor said. Disruptions in the supply chains will create problems in cooking oil procurement in markets, she added.

Parawansa further said she hoped that the entire process can provide supply chain certainty to consumers, in accordance with the HET determined by the Trade Ministry.

Source: Antara News

The green economy will create 4.4 million new jobs in 2030, Deputy for Economic Affairs at the Ministry of National Development Planning/National Development Planning Agency (Bappenas) Amalia Adininggar Widyasanti stated.

“A new business model is required to tap the green economy potential. This new business model certainly requires new skills that are estimated to create 4.4 million new jobs related to green jobs,” Widyasanti remarked at the online Green Jobs Conference monitored in Jakarta, Tuesday.

The deputy noted that new job opportunities would be available in several priority sectors, such as renewable energy, agriculture, waste management, transportation, and tourism.

It is estimated that its contribution to the gross domestic product (GDP) would reach Rp600 trillion in 2030.

“However, the potential of the green economy must also be complemented and accompanied by the availability of workers, who understand the requirements of industries to run a green industry,” she remarked.

To this end, the government should help prospective workers to hone their skills in accordance with the requirements of green jobs.

Widyasanti also highlighted development in the new and renewable energy sector, which she opined was not yet optimal.

The deputy cited the example of the potential of solar power as an energy source in Indonesia that reaches 207.9 gigawatts, though only 0.3 gigawatts had been utilized.

Meanwhile, the potential of hydropower as an energy source reaches 94.5 gigawatts, though only 6.1 gigawatts had been utilized.

“There are many new and renewable energy potentials, and now, we still mostly utilize the existing energy sources. It is just a matter of our commitment and will to encourage a more progressive energy transition,” she added.

Source: Antara News

The Indonesian Government is optimizing the green economy transition by creating a systemic green policy framework, an official from the Ministry of National Development Planning/National Development Planning Agency (Bappenas) has said.

“The government has a strategy to optimize the transition to a green economy, firstly through the establishment of a systemic green policy framework,” the ministry’s deputy for economic affairs, Amalia Widyasari, said at the ‘Green Manpower Conference,’ accessed online from Jakarta on Tuesday.

This systemic green policy framework starts from the formulation of coherent inter-ministerial and institutional policies to the preparation of a financing plan for green economy, she informed.

“This is also not enough from the state budget, but also requires private sector mobilization and public awareness to lead to a green business model,” Widyasari said.

The government is also optimizing the green economy transition in terms of financing so that business infrastructure in the capital market can also lead to a green economy, she informed.

“Currently, the Financial Services Authority (OJK) has also issued a green taxonomy, meaning that the financial sector should also fund green or environmentally friendly economic projects as much as possible,” she added.

Furthermore, to optimize the transition to a green economy, the government has continued to educate the public that implementing a green economy will not correct the economic stretch, she said.

“But its implementation can actually be seen as a potential source of economic growth,” she said.

The government will also create tools to measure the progress and impact of implementing more environmentally friendly activities on economic growth and community welfare, Widyasari said.

“I think it is important that we put in the right performance indicators. In the future, this is to measure how much progress the implementation of the green economy has made in Indonesia,” she added.

Business actors can play a crucial role in helping the government make the transition to a green economy, according to the Institute for Development of Economics and Finance (Indef).

“Business actors are the only party capable of helping the government to develop a green economy,” Indef researcher Nailul Huda earlier said.

The green economy transition includes the use of more environmentally-friendly energy and industry, he said. The transition has been encouraged by the global community lately as an effort to address climate change, he added.

The business world can play a huge role in the development of a green economy, he said. Therefore, the government should make maximum efforts to encourage business actors to take part in the green transition, he stressed.

The key to maximizing the participation of the private sector in green economy development lies in the provision of incentives by the government, he explained.

According to Huda, as long as government incentives are sufficient to reduce the costs borne by business actors to shift to green economic practices, interest in the development of green industry and energy among business actors will remain high.

Source: Antara News

A group of young people, on behalf of the Youth Movement, declared their support for the energy transition agenda of Indonesia’s G20 Presidency on Tuesday.

Director of development, economy, and environment at the Ministry of Foreign Affairs Hari Prabowo expressed the hope that the initiative would support the success of Indonesia’s G20 Presidency.

“I welcome this opportunity to launch the Declaration of Youth Movement for the G20 Energy Transition. God willing, this good initiative will support the success of Indonesia’s G20 Presidency,” he remarked during the event, accessed from Jakarta on Tuesday.

There are three important points in the declaration supporting the energy transition, he said.

First, increasing awareness and advocacy for energy transition and climate change mitigation in Indonesia, he informed.

Second, creating a space for the youth to contribute proactively to promoting energy transition and climate change mitigation actions on all public forums, he said.

Third, increasing the real contribution to the energy transition program and climate change mitigation actions in Indonesia, he added.

Prabowo said that the government has encouraged Indonesia’s young generation to collaborate with working groups and engagement groups during its G20 Presidency.

“We hope that this declaration will become a shared spirit in the success of Indonesia’s Presidency and the energy transition in the future,” Prabowo remarked.

As G20 President, Indonesia is seeking to become a part of global energy solutions and push progress in the energy sector, he said.

The government has underlined that each country has its own challenges, character, and opportunities, so Indonesia will avoid a “one-size-fits-all” approach and two-perspective policies that are generally promoted by developed countries, he added.

According to Prabowo, the Indonesian government is seeking policy spaces that continue to prioritize developing countries.

“Indonesia does not refuse, even emphasizes ambition in the energy transition. However, this ambition must be based on the effective implementation of existing commitments,” he said.

In addition, Indonesia is emphasizing that the energy transition must include the dimensions of development that are environmentally sound, including equitable development and eradication of poverty, he noted.

This would allow the energy transition to go hand in hand with energy security, energy accessibility, and energy affordability, he explained.

“Energy security and access to energy must be ensured and must be part of the energy transition effort,” he remarked.

Meanwhile, Director of New, Renewable Energy, and Energy Conservation at the Ministry of Energy and Mineral Resources Dadan Kusdiana said that the energy transition is a long process that will need to be carried out by countries across the world to reduce carbon emissions that can cause climate change.

The agreement in the energy transition aims to reach the same point, namely increased use of clean energy, he added.

“This is not a process that will take a day or two or a year and two years. President Joko Widodo has said that we (Indonesia) in 2060 need to reach net-zero emissions,” Kusdiana said.

Source: Antara News

With the Indonesian government preparing to shift the nation’s capital to East Kalimantan, Jakarta will soon shed its capital city status.

The plan to move the capital city had, in fact, been initiated in the era of Indonesia’s first President, Soekarno, and will now be realized by President Joko Widodo.

The process to move the capital city has been accelerated after the Indonesian House of Representatives agreed to ratify the bill on the National Capital City (RUU IKN) at the plenary meeting on January 18, 2022.

The IKN Law has projected the Indonesian government’s seriousness in shifting the capital from Jakarta to East Kalimantan, with the move targeted to take place from 2024 to 2045.

The National Development Planning Agency (Bappenas) has also issued the National Capital City Relocation Pocket Book, which contains information regarding the stages of moving the capital city.

The new capital’s development will begin with the construction of major infrastructure, including the Presidential Palace, the People’s Consultative Assembly (MPR)/House of Representatives (DPR) building, and the construction of residential housing in the main area of the new capital city, which will be named “Nusantara.”

Then, the next stage will be the transfer of the State Civil Apparatus (ASN) in the initial phase, including the personnel of the Indonesian Military (TNI) and the National Police (Polri) and the MPR, followed by the construction of basic infrastructures such as water and energy.

New Capital City Budget

The plan to relocate the capital city has evoked various reactions from the society, both positive and negative.

Those who support the plan deem that moving the capital is part of efforts to achieve equitable development in Indonesia as well as ease the burden on Jakarta.

Meanwhile, the high budget required for the construction of the new capital, especially amid the COVID-19 pandemic, has become one of the reasons some people have slammed the government’s capital relocation plan.

In 2020, Bappenas informed that the budget for the new capital is projected to reach Rp466 trillion, with Rp90.4 trillion for the physical development of the new capital city to be sourced from the State Budget (APBN) directly.

Meanwhile, Rp252.5 trillion will be sourced from the government and business entity cooperation (KPBU) scheme and Rp123.2 trillion from the private sector and regional regional-owned enterprises (BUMD) and state-owned enterprises (BUMN) scheme for financing the development, he informed.

Coordinating Minister for Economic Affairs Airlangga Hartarto has assured that the funds for the National Economic Recovery (PEN) program, which are meant for handling the after-effects of the COVID-19 pandemic, will not be used for the development of the new capital.

Jakarta’s Future

After Indonesia’s House of Representatives approved the State Capital Bill (RUU IKN) as law, many people began to question Jakarta’s future.

Chairperson of the Jakarta Chamber of Commerce and Industry (Kadin), Diana Dewi, during a public discussion on the impact of moving the state capital from Jakarta on January 24, 2022, said that the capital city relocation would affect Jakarta’s economic performance.

The impact will be felt in household spending and government spending in Jakarta, which are expected to decline, she underlined.

The reason is that labor-intensive industries are expected to leave the city and other satellite cities, and household consumption is also expected to decline as civil servants and TNI and Polri personnel are transferred to the new capital, she said.

In fact, the Jakarta Kadin has noted that the level of household consumption in Jakarta affects the performance of other regions, namely Java (21 percent), Bali and Nusa Tenggara (7 percent), Kalimantan (6 percent), Sumatra (5 percent), and Sulawesi-Papua (4 percent).

According to data from the National Development Planning Agency (Bappenas), in 2019, Jakarta contributed 20 percent to the trade-sector GDP, with its financial services center contributing 45 percent.

Meanwhile, the company service center contributed 68 percent, government administrative and defense centers 49 percent, educational services 27 percent, and process industry 10 percent, the agency said.

Jakarta contributed 17.23 percent to the country’s gross domestic product (GDP) in the second quarter of 2021, based on data from Statistics Indonesia (BPS).

Jakarta to Continue Growing

Kadin has said it is optimistic that despite the relocation of the capital city, the nation’s economy will still rely on Jakarta.

There are several things that Jakarta can do to anticipate a decline in economic performance after the relocation of the capital city, it said.

The provincial government of Jakarta can switch to a high value-added economy and collaborate with neighboring provinces, including West Java and Banten, it suggested.

Jakarta must transform into a business city since business distribution in Jakarta is dominated by large-scale trade and retail businesses (46.7 percent), accommodation and food & beverage (16.72 percent), and the process industry (16.53 percent), Kadin said.

Support for the MSME sector is also needed because it accounts for about 93.46 percent of businesses in Jakarta, it added.

With the support from the infrastructure in Jakarta, the city can focus on being a center for finance and banking to a center for logistics and export-import activities.

Executive director of the Institute for Development of Economics and Finance (Indef), Tauhid Ahmad, urged the provincial government of Jakarta to anticipate the short-term and long-term impact of the capital relocation.

The impact on household spending, workforce, investment, export, and economic growth must be anticipated, he said.

Sectors that are directly affected also need to be identified, mitigation scenarios prepared, as well as collaboration with the central government, local governments, businesses, and universities achieved, he added.

Jakarta as Economic Center

Jakarta Governor Anies Baswedan assured that Jakarta will remain Indonesia’s economic center even when it no longer holds the status of the capital city.

The provincial government of Jakarta is currently formulating Jakarta’s position after the capital city relocation by involving experts, he informed.

Deputy Governor of Jakarta, Ahmad Riza Patria, also said that development in Jakarta will resume as the government will continue to beautify Jakarta, ensure transportation integration, and make efforts for handling floods.

The relocation of the capital city will not only present challenges for Jakarta, but also Nusantara as the new capital of Indonesia, he added.

Especially for Jakarta, the government, both central and regional, as well as other parties, must ensure that Jakarta still has its magnetism and continues to support the national economy, Patria said.

Source: Antara News

The Papua administration has reiterated its commitment to improving the quality of human capital in the province by providing scholarships to at least three thousand native Papuans.

“As a result, they can pursue higher education under the scholarship schemes at reputable universities in Indonesia and abroad,” head of the Papua Communication and Informatics Office, Jery Yudianto, said.

Thanks to this affirmative action program, many native Papuans can finish their higher education and become a part of the skilled workforce, he told ANTARA during an interview in Jayapura on Tuesday.

The scholarship recipients can finish their undergraduate, postgraduate, and vocational programs and become medical doctors and pilots, Yudianto added.

Papua Governor Lukas Enembe’s education policy for native Papuans has helped improve the quality of human capital and allowed native Papuans to contribute to regional development, he said.

“This affirmative action program has won the central and Papua provincial governments’ attention because quality education is believed to contribute to improving the quality of human resources,” he added.

In this regard, the Ministry of Home Affairs recently sent a team to Papua to guarantee the budgeting and sustainability of scholarships for Papuan students studying in such countries as the US, Australia, and the UK.

In a statement issued on February 2, 2022, director general of regional financial development, Agus Fatoni, informed that the technical team had met with the Papua provincial government in Sentani, Jayapura.

ANTARA has reported earlier about how the Indonesian government has consistently demonstrated its strong commitment to boosting the development of the country’s eastern regions, including Papua and West Papua provinces.

The Papua special autonomy law has paved the way for fund flows from the central government to Papua and West Papua since 2001.

The Finance Ministry’s data has indicated that during the implementation of the Papua special autonomy law, the government disbursed Rp138.65 trillion for Papua and West Papua as special autonomy funds and additional funds for infrastructure projects.

Meanwhile, the total regional transfer and village funds that the government distributed in the two provinces between 2002 and 2021 have been recorded at Rp702.3 trillion, according to People’s Consultative Assembly (MPR) speaker Bambang Soesatyo.

Despite central funding, the two provinces are still struggling to improve the quality of their human capital, as evidenced by their scores on Indonesia’s 2020 Human Development Index, which were below the national average of 71.94.

Statistics Indonesia (BPS) revealed that Papua and West Papua scored 60.44 and 65.09, respectively, on the index. Their scores were lower than Aceh province, which chalked up 71.94.

BPS data released in February this year further showed that the poverty rates in Papua and West Papua were recorded at 26.8 percent and 21.7 percent, respectively.

Development outcomes also remained inequitable for native Papuan communities as was apparent from their low income level and lack of access to education and health services, it said.

In the midst of this challenging reality, the government has hinted its intention to extend the allocation of special autonomy funds for Papua and West Papua by another two decades to accelerate endeavors to close the development gap and usher in prosperity for all communities in the region.

Source: Antara News