Day: January 18, 2023

Deputy chairperson of the Indonesian Chamber of Commerce and Industry (Kadin) Shinta Widjaja Kamdani has expressed optimism that Indonesia’s economy will continue to grow in 2023 despite a global slowdown.

“We agree with the government and remain optimistic that Indonesia’s economy will continue to grow throughout this year even though the global economic climate is not conducive or supports growth in developing countries,” she said when contacted here on Wednesday.

Kamdani further said that she did not see external pressures, such as the weakening global economy, causing a crisis or a decline in economic performance, even though they may pose a risk in the form of triggering a decline or slowdown in growth.

Nevertheless, the risk would not be as severe as in G7 countries such as Canada, France, Germany, Italy, Japan, the UK, and the US, she added.

“On the contrary, we have a very good chance of being able to maintain the performance of the economic recovery that has occurred since 2021 because our macroeconomic fundamentals are very solid and support stability,” she explained.

“This is an important factor in the current condition (the high risk of a global crisis) to support more optimal economic growth in Indonesia,” she added.

Indonesia is considered to have an opportunity to grow better compared to last year if the country can maintain and increase conduciveness, maintain the momentum of structural reforms, and improve the efficiency of the national business or investment climate amid the political campaigns this year.

“However, with the presence of those global pressures, we must remain alert and be more active in boosting national economic performance,” Kamdani said.

Several efforts need to be made to realize continuous national economic growth, such as improving people’s purchasing power, boosting consumption, and controlling inflation and the exchange rate, she added.

In addition, it is necessary to maximize the growth of investment and the healthy performance of national business actors at various levels so that they continue to grow and are not affected by external pressures from the global economy, which is not in a good condition.

Source: Antara News

State-owned defense equipment company Pindad, which is a part of the national defense holding DEFEND ID, is planning to launch the electric variant of its Maung tactical vehicle in 2024.

“Next year, we will launch the fourth version (of Pindad Maung), and there will be an electric vehicle variant,” Pindad’s director of technology and development, Sigit P. Santosa, informed after President Joko Widodo (Jokowi) inaugurated the Pindad Maung brand at the Defence Ministry Office here on Wednesday.

He said that the Pindad Maung is the third generation of the Pindad tactical vehicle’s development.

To produce the electric variant, the company is striving to increase the domestic component level (TKDN) rate by localizing the production of some components, as Pindad Maung’s TKDN rate is currently 65 percent.

“The rolling chassis, trim, engine, and power trim are components that we still import. While the other, such as the design, development, and building, have been done by Pindad or its ecosystem partner, and the vehicle has 65 percent (TKDN rate),” Santosa informed.

The company is seeking to localize the engine and chassis frame, and in the process of developing the electric variant, the company is targeting an 80–90 percent TKDN rate, he added.

Santosa said that the latest Pindad tactical vehicle has evolved significantly from the earlier variant, for instance, the Pindad Maung has a more compact design.

“The wheelbase is 10 inches and is more compact (than earlier generations). In addition, the vehicle has a hybrid off-road and on-the-road capability, which makes it not too heavy for general road use but remains dependable in mountainous terrain,” he observed.

Moreover, Pindad Maung has more diverse functionality compared with earlier generations—the vehicle has commando and operational versions as well as a tactical version for adding armaments, he said.

Source: Antara News

Indonesia will not import fossil fuels from 2045 as it will have developed the potential of palm oil as an alternative fuel by then, Coordinating Minister for Maritime Affairs and Investment, Luhut Binsar Pandjaitan, has informed.

“We are currently researching (the potential of) palm oil because we believe that we will be able to produce around 100 million tons of palm oil by 2045,” he said in Davos, Switzerland, on Tuesday local time.

He made the statement during a presentation entitled “Indonesia Zero Pathway: Opportunity & Challenges” at the Indonesian Pavilion at the World Economic Forum (WEF) Annual Meeting 2023.

At least 30 percent of palm oil production will be used for the food industry, while the remaining 70 percent will be used to manufacture ethanol, the coordinating minister said.

“Thus, we will not need to import fossil fuel at that time (by 2045),” he added.

He said that the development of alternative fuels is one of the five green economy pillars whose implementation is being intensified by Indonesia.

The other four pillars are the decarbonization of the electricity sector, the utilization of low-carbon transportation, the development of green industry, and the strengthening of carbon sink.

According to Pandjaitan, the transition from fossil energy to renewable energy would encourage the realization of net-zero emissions by 2060.

“That is the reason that the (utilization of the derivative products of) palm oil will have big impacts in the upcoming years,” he said.

The Indonesian government has put a moratorium on oil palm plantation permits, thus the productivity of the plantations can be increased from 2.3 tons per hectare to 8–10 tons per hectare in the next 10–15 years, he observed.

In addition, the moratorium policy aims to reduce deforestation due to the expansion of oil palm plantations.

Furthermore, as the world’s largest crude palm oil (CPO) producer in the world, Indonesia has also implemented a mandatory program to push the use of CPO-based biodiesel since 2008, the coordinating minister said.

The mandatory program aims to cut imports of fossil fuels, increase the use of renewable energy, as well as minimize emissions from the use of fossil fuels.

Source: Antara News

Central Java Governor Ganjar Pranowo affirmed that his side is preparing a microtargeting strategy to overcome various problems of poverty and stunting whose prevalence and figures remain high in the province.

“We follow up on President Joko Widodo’s directive by creating a program to tackle poverty and stunting with the microtargeting (strategy),” Pranowo stated here on Wednesday.

He explained that the new strategy in dealing with poverty and stunting will involve village and sub-districts heads in all regions across Central Java.

“That way, (information on the targeted population) can be in detail, such as who is poor, where are them, how many are there, and what kind of intervention (is needed). When the (intervention) is ready, the handling must be done collaboratively,” he remarked.

At the “2023 National Coordination Meeting of Regional Heads and the Regional Leadership Communication Forum” in Sentul, West Java, on Tuesday (January 17), the president has emphasized the need for regions to reduce stunting cases and poverty rates.

So far, Pranowo highlighted that the programs to reduce the poor population and stunted children prevalence had been running well in Central Java, but the COVID-19 pandemic has triggered an increase in poverty in some regions in the province.

“We are on standby, (Insya Allah) God willing, starting this week, we will do a ‘roadshow’ (visit) to several regions and assign village heads to record data of (targeted population) in detail,” he explained.

In addition, he urged sub-district heads to coordinate with the related parties and each district head will be responsible in their respective areas.

The Central Java governor also highlighted the president’s message that investment must be facilitated, including the use of the regional budget and the state budget to provide stimulus for economic growth, help reduce unemployment, and alleviate poverty.

“Hopefully, after the briefing, we will all be more solid and ready to face 2023 with more certainty, more measured with a clearer target,” he stated.

Source: Antara News

Indonesia still has large capital and opportunities to sustain a growing trade balance amid global turmoil through increased industrial downstreaming, according to the Presidential Staff Office (KSP).

The downstreaming policy, which has become one of President Joko Widodo’s priority agendas, could improve the domestic industrial ecosystem and maintain the development of the national trade balance in the long term, chief expert at the KSP Agung Krisdiyanto said.

“The results are there already. During 2022, downstream nickel commodities have succeeded in boosting the export value of nickel and its derivatives by 365 percent year on year (yoy),” he pointed out.

The state is capable of diversifying exports to non-traditional countries, particularly those it has trade agreements with on low tariff schemes, Krisdiyanto opined.

Indonesia currently has trade agreements, both regional and bilateral, with ASEAN, Japan, Pakistan, Chile, the United Arab Emirates, Mozambique, Australia, and South Korea.

It is also pursuing the Indonesia-European Union Comprehensive Economic Partnership Agreement (IEU CPA), which is expected to be completed by the end of 2023.

“The KSP will oversee and conduct de-bottlenecking measures so that we can come to an agreement soon,” Krisdiyanto said.

The government is trying to reduce imports by prioritizing domestic products through the policy on goods and services procurement, he added.

This commitment has been outlined in Presidential Instruction Number 2 of 2022, which seeks to increase the use of domestic products and products made by micro and small enterprises and cooperatives in a bid to make the Proudly Made in Indonesia initiative a success.

At present, Indonesia’s condition is still much better compared to other countries since its economy is dominated by the domestic market instead of the international market, he said.

Global influences could be circumvented through inward-looking policies, or strategies that utilize the domestic market to promote economic growth, he added.

He also assured that at least US$137 billion in foreign exchange reserves is still sufficient to finance imports for six months. Therefore, it could function as a cushion that is durable enough to maintain the stability of the rupiah exchange rate, which could be impacted by fluctuation due to the increase in the Fed’s interest rate.

“The business sector must remain cautious, but don’t panic and worry— Indonesia’s economic condition is still much better,” he assured.

In 2022, the national trade balance recorded a surplus of US$54.46 billion, reflecting a growth of 53.7 percent yoy.

Indonesia has seen a trade balance surplus for 32 consecutive months since May 2020, according to official records. However, many believe that the record will not be maintained in 2023 due to global issues.

Source: Antara News

The quality of the government’s rice reserve stocks (CBP) stored by the State Logistics Agency (Bulog) in 2022 is good so they do not need to be released and sold below market prices, an official said.

“This condition (release of CBP at a low price) is possible. However, with utmost care and maintenance carried out by Bulog, the condition of the stored 2022 rice is all of good quality,” head of public relations and institutional affairs at Bulog Tomi Wijaya said here on Wednesday.

He informed that based on the Agriculture Minister’s Regulation Number 38 of 2018 on the management of CBP, the release of rice reserve stocks can be carried out if they have exceeded the shelf-life limit of at least four months and/or have the potential for or have experienced a decline in quality.

Rice reserves have the potential for or can experience a decline in quality if they meet the criteria of at least a milling degree below the minimum threshold and contain broken grains and water above the maximum threshold.

Article 7 of the Minister of Agriculture’s Regulation Number 38 of 2018 states that the release of CBP can be carried out by Bulog through sale, processing, exchange, and or grants.

Article 8 of the regulation states that the sale can be carried out by selling CBP below the retail price ceiling (HET) of rice.

Earlier, during a working meeting with Commission IV of the House of Representatives (DPR) on Monday (January 16, 2023), Bulog president director Budi Waseso said that the National Food Agency had proposed that Bulog’s CBP stock in 2023 be increased to 2.4 million tons from the initial plan of 1 million tons.

To maintain the quality of CBP, rice that has been stored for four months at Bulog warehouses can be sold at a price below the purchase price, with the difference in price compensated by the government.

With that plan, he said he believes that there would be no Bulog rice of reduced quality as a result of being stored in warehouses for too long.

The plan could be carried out, but since the CBP throughout 2022 was maintained in good quality, there is no further plan to release CBP at a price below the HET, he said.

Source: Antara News