TPP-20th-Edition - The President Post

The President Post
THE SPIRIT OF INDONESIA
Display until February 17, 2011 /// N0. 20
As one of the country’s
finest sons, Juwono
Sudarsono leads a
very rich life, playing
key roles in serving his
country. He has made
his marks with many
achievements and
contributions intended
for the betterment of
the nation.
Juwono devoted much
of his time to the country’s
education sector.
Juwono served as Minister
of Education and
Culture in President BJ
Habibie’s Cabinet of Reformation
(May 1998-October 1999), he is
a professor at University of Indonesia
since 1998, he taught at The
School of Public and International
Affairs, Columbia University,
New York City from 1986 to
1987 and he did a three-year stint
as vice governor at the National
Defense Institute (Lemhannas)
from 1995 to 1998.
Prof. Juwono is the youngest
son of the late Dr. Sudarsono,
a prominent diplomat and former
social affairs minister, minister
of home affairs, and Indonesia’s
ambassador to Yugoslavia.
After completing primary school
in India, he studied at a junior
high school in Cikini, Jakarta,
and went to England to finish his
high school.
Juwono graduated from University
of Indonesia, Jakarta
(B.A., M.S.); Institute of Social
Studies, The Hague, Netherlands;
University of California,
Berkeley, USA (M.A.) ; and The
London School of Economics,
UK (Ph.D).
During President Soeharto’s
New Order regime Juwono
served as State Minister of Environment
(1997-1998), Minister of
Defence under President Abdurrahman
Wahid (October 1999 -
August 2000), he was assigned as
ambassador to the United Kingdom
during President Megawati
Soekarnoputri’s administration
(June 2003 - October 2004), and
again served as Defence Minister
during President Susilo Bambang
Yudhoyono’s first term as president
(21 October 2004 - 20 October
2009).
This year, Prof. Juwono is reengaged
in the education world.
He has been appointed as Chairman
of President University
Foundation.
Prof. Juwono is one of the
founders of President Universi-
THE ECONOMY
Government to Reduce
Unemployment by 0.5% in
2011
The government has set itself
the target of reducing the
unemployment rate by 0.5 percent
from 7.5 percent in 2010 to 7
percent this year.
PAGE A5
BUSINESS
State Companies Control
26% of Stock Market Capital
Seventeen state-owned
companies listed at the Jakarta
Stock Exchange (BEI) control
26 percent of the market`s total
capital, State Enterprises Minister
Mustafa Abubakar said.
PAGE B1
Juwono Sudarsono:
The keys to success are innovation, implementation and
commercialization through partnership with private companies
ty Foundation, which conceptual
plan as President University was
formulated in September 1997
by Setyono Djuandi Darmono,
President Director of PT Jababeka
Tbk., and Prof. Donald W.
Watts, who was at the time President
of Bond University, Queensland,
and Vice Chancellor of
Curtin University, Australia.
As the Chairman of PU Foundation,
“I will emphasize on the
importance of training future
managers and lecturers by stressing
on planning and transparent
financial management. This is
crucial,” said Juwono.
According to him, “a university
should offer an attractive teaching
method, alluring, and in line
with social reality. There should
be a balance between imagination
and an ability to act, so that
the brain and the ability to act
can induce exhilarating spirit of
lecturers, students, PU staff. Excellent
graduates can only spring
out from campus members who
are proud of those elements.”
Universities also need to help
the government to reduce unemployment
rate by continuously
providing jobs in the manufacturing
sector. One of the
advantages offered by PU is its location.
It is located in the heart
of the largest industrial area in
Southeast Asia.
Prof. Juwono attributed Japan’s,
South Korea’s, China’s and
India’s robust economic growth
to their leaders’ vision and awareness
on the importance to build
world class universities.
“10% of the workforce in those
countries transformed themselves
from agriculture-based to science
and technology-based. Their economic
structures changed from
secondary industry researchbased
into economies based on
research, technology science and
services. The keys to this success
are innovation, implementation
TECHNOLOGY
Getting Ahead: How
Indonesia is Using ICT
to Boost its Standing Among
its Neighbours
SThe Indonesia’s government
believes that IT is an essential
driver of competitiveness and
national economic growth.
PAGE B5
and commercialization through
partnership with private companies,”
said Juwono.
With regards to problems in
Indonesia’s education sector in
general, Juwono said the most
fundamental problem is access to
basic, intermediate, and high education
that can further unite Indonesians.
“President University is a college
of multi-ethnic, interfaith,
cross-regional, interracials and inter-civilization.
PU is not marked
by a certain religion, tribe or a
a particular region. PU has 5
dimensions: local, provincial, national,
regional and international,”
he explained.
On Indonesia’s preparations to
compete in the free trade era, Juwono
said we should “strengthen
PSM education (professional
science management) so that everyone
in echelon 2, 3, and 4, the
public in general and the private
sectors can understand the im-
Garuda to Purchase 11 New Planes this Year
National flag carrier Garuda
Indonesia plans to buy 11 new
planes this year with the first delivery
expected in February or
March.
The planes consisted of nine
Boeing 737-800s and two Airbus
330-200s, Garuda Indonesia
Technical Director Hadinoto
Soedigno said here on Thursday,
Antara reported.
The nine Boeing 737-800s
would be delivered in stages starting
February or March, and the
two Airbus 330-200s would be
delivered in April and October,
he said on the sidelines of a roadshow
for the airline`s initial public
offering.
He said Garuda, which currently
has a fleet of 87 planes, expects
to operate 130-150 planes
in the next five years.
With the targeted fleet of
130-150 planes in 2015, Garuda
would buy a minimum of 10
planes in each of the next five
years, he said.
Garuda is expected to list its
shares with the Indonesia Stock
Exchange on February 11. The
company`s chief financial officer
Elisa Lumbantoruan said on
Wednesday about 80 percent of
the proceeds of the IPO would be
spent on expanding the airline`s
fleet and 20 percent to finance its
capital expenditure.
Hadinoto said Garuda would
operate its Boeing planes to serve
its domestic flights such as Jakarta-Gorontalo
via Surabaya and
Makassar, Surabaya-Balikpapan,
and Surabaya-Ampenan.
Meanwhile, the Airbus planes
would be used to serve its regional
routes which would be opened
soon, including Jakarta-Manila
and Jakarta-Taiwan, he said.
Mandala routes
PT Garuda Indonesia is interested
in flying the routes abandoned
by Mandala which recently
suspended its operations due to
financial problems.
“If we are asked whether we are
interested to take over the routes
left by Mandala, the answer
would be yes,” the company`s
marketing vice president Don
Jusuf Palito said on the sidelines
of the launching of Boeing 737-
800NG here on Saturday.
Garuda on Saturday started
operating New Boeing 737-
800NG with 156 seat capacity to
serve the route to Kuala Lumpur,
Malaysia, twice day.
“We see good market potentials
in Malaysia. Garuda also
plans to expand to Penang, Johor
and other destinations in Malaysia,”
Don said.
ECONOMIC REVIEW
Government to Boost
Manufacturing, Agro-
Industry Sectors in 2011
This was announced recently by
Minister of Development Planning
and Chairperson of Bappenas who
is upbeat about the government’s
ability to spur growth this year.
PAGE C1
portance of having competitive
products on the basis of technical
understanding, quality and prices
that will change with innovations.
Having PSM educationequipped
echelon 2, 3 and 4 are
more important than any agreements
clinched by ministers, director
generals or CEOs of private
companies.”
“Now the situation has
changed because not all overseas
graduates are better than home
graduates. It highly depends on
what university they graduated
from and their own characters,”
he elaborated.
Furthermore he added, “most
important is whether or not those
graduates can create a job for
themselves and help to create jobs
for others. But in facing global
competition that leads to science-based
economy, technology,
knowledge and services, PU has
already mapped out Indonesia’s
economic structure for the next
20-30 years.”
Finally, Juwono hoped that access
to basic education can be enjoyed
by children across the country,
from Aceh to Papua, North
Sulawesi to East Nusa Tenggara.
IDR 20,000
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PLN Chief Slams
Industrialists for Not Using
Common Sense
Dahlan Iskan, president director of state
electricity company PT PLN, has accused
Indonesian industrialists of being spoiled
and not using their common sense in rejecting
the new basic electricity tariff for
industry.
“They just want to keep their own industries
alive and leave the electricity industry
in distress. They keep on wanting to be
pampered and lulled to sleep by lullabies,”
Iskan said in a press release issued by PLN
last week.
Dahlan`s statement was issued two Dahlan Iskan
days after the chairman of Indonesian Employers
Association (Apindo) Sofjan Wanandi said last Thursday that the
industrial sector was considering to switch business to importing goods
from overseas instead of producing them in light of the power rate hike
for the industrial sector.
Wanandi claims producing goods domestically had become more
costly due to the high price of electricity after the lifting of the 18 percent
ceiling on electricity tariff hike by PLN.
Dahlan said other industries whose number is bigger have paid electricity
tariff on normal rates without asking for a special treatment such as
ceiling for any hike to be introduced by PLN.
“If the argue the lifting of the ceiling would diminish their competitive
edge, then why are similar industries that have paid electricity on normal
rates remain competitive?” he wondered.
Dahlan goes on to say that if the pampering of the industrialists is not
opposed, then the Indonesian people would never be able to progress.
He adds that the industrialists opposing the ceiling have also been
voicing an impression that the entire industrial sector as a whole would
be affected by the hike ceiling lifting, which he insists is not true.
President, PLN chief meet
President Susilo Bambang Yudhoyono and state electricity company
PT PLN President Director Dahlan Iskan did not discuss the electricity
rate capping issue at their meeting at the State Palace on Monday.
“The president will go to Asahan on Tuesday, and PLN is building a
power plant in Asahan but the meeting had nothing to do with the capping
issue,” Coordinating Minister for Economy Hatta Rajasa said on
Monday.
Hatta added that on the capping issue, he had asked energy and mineral
resources (ESDM) minister and state minister for state enterprises
(BUMN) to avoid a polemic and to have the issue settled.
“There has been no revocation. I have asked ESDM and BUMN ministers
at a coordination meeting to resolve the issue,” Hatta said.
President Susilo Bambang Yudhoyono summoned state electricity
company PT PLN President Director Dahlan Iskan to the State Palace on
Monday morning for a closed door meeting.
Presidential spokesman Julian Aldrin Pasha said that at the brief meeting
with President Yudhoyono, Dahlan only reported about the progress
of PT PLN.
1,000 New Motorbikes
Flood Jakarta Every Day
About 1,000 new motorcycles hit Jakarta`s streets every day
due to the city`s high economic growth, Jakarta Governor Fauzi
Bowo said here this week in remarks at the opening of a Young
Entrepreneurs Forum here.
He said Jakarta`s fast economic growth was related to its
residents` purchasing power, but the increasing numbers of cars
and motorbikes could have a negative effect in contributing to the
city`s traffic problems, Fauzi said.
He said the city administration could not make any policy
without considering matters related to the increasing number of
motorbikes.

A2
January 17, 2011
Viewpoint
A KADIN INITIATIVE
CONTACT :
PT Infrastructure Asia
Kantor Taman A9 Unit C7 Lt. 3
Kawasan Mega Kuningan, Jakarta 12950 - Indonesia
T +62 21 576 4440 | F + 62 21 576 4552
info@indonesiainfrastructure.org
MEDIA SUPPORT :
The President Post www.thepresidentpost.com
Reviving Indonesia’s Maritime Spirit
REGOM (reinventing government administration)
is a reform movement and transformation of city
administration management introduced by the
United States government as a development
breakthrough to boost efficiency, effectiveness and
government management performance.
The approach was later
introduced to other
countries, both
developed and developing
countries.
REGOM consisted
of three approach principles, (1)
de-bureaucratization; (2) financial,
organization and management
restructuring and (3) privatization.
In developing a city, many advanced
nations adopted this principle
on areas with certain characteristics
that have strong selling
points, such as core city areas,
hearts of the city, old ports, areas
with historical backgrounds, waterfronts
and more. The reason
being, the locations are deemed
to have strategic values, offering
certain gimmicks/genus loci
which are non-renewable, highly
controlled, priceless, such as heritage
value, waterfronts, harbor
fronts/harbor sides, inner downtowns,
main street corridors and
more. The movement is also often
linked to prestigious missions
that carry themes such as “awakening”,
reflecting on past glo-
ries that can instil a development
spirit with terms like revitalization,
rebirth, renaissance, regeneration,
reshaping and more.
The success of this movement
is usually contributed by a driving
factor. In England, for example,
it is associated with a privatization
policy breakthrough
which was massively launched by
Margaret Thatcher through Action
for Cities, which was aimed
to restore pride to the city (to discover
the sense of civic pride).
Action for cities targets is to reorganize
inner cities with the
REGOM approach as a ”participatory”
strategy that involved
all ”stakeholders” in city development.
To achieve the goal,
Thatcher formed an action group
which consisted of action men
and established the Urban Development
Corporation, an independent
body that runs core city
areas in six cities, including London,
Liverpool and Thyne.
The facilities created to support
the programs were: (1) urban
programs that regulated government-private
sector-public cooperation:
(2) urban development
grants to help fund development
of old city areas; (3) urban regeneration
grants to help private sectors
to develop former industrial
areas; (4) derelict development
grants to help the private sector in
purchasing abandoned industrial
estates; (5) land registers to provide
information on abandoned
By Ir. Martono Yuwono
estates in cities and other regulations.
London Dockland in London
and Albert Dock in Liverpool,
England, were two success
stories of this approach.
The REGOM movement synergy,
which is aimed at strategic
areas in city development, was a
new phenomenon launched by a
visionairy utopian, who efficiently
motivated developments that
generated wide participation,
including triggering a national
movement. Participation and
transparancy, as elements to support
democracy in development,
carried a strategic meaning that
could potentially create a sense of
belonging to all players involved
in the development process. The
effectiveness of REGOM highly
depended on all factors mentioned
above.
The same spirit was also adopted
by Yayasan Pelestari Budaya
Bangsa (YPBB), which carried
out a pilot project for Indonesia
to reorganize Bandar Nusantara.
Bandar Lama Sunda Kalapa
was chosen as a pilot model. The
first step was to design a master
plan to accommodate common
aspirations by reaching a consensus
among development executors
by involving development
consultants and NGOs to serve
as advocates in every aspect of
the development in a partnership
environment: (1) government
sector, with consultancy team
(development consultant as fa-
cilitator) for city areas; (2) private
sector: KWB Sunda Kelapa business
community; (3) community
sector, with non governmental
organizations as community
facilitator, in this case Kampung
Nelayan Tradisional Luar Batang
as the pilot model. The “Kampung
Luar Batang” community
development program was a
nine-year project (1988-1997),
which could be categorized as an
initial step to participatory development
which grew purely from
the grassroots in Jakarta.
The establihment of a special
body in the development of
PANTURA area which carried
”The Revival of Jayakarta” as its
theme, could potentially lift the
area or parts of it with a specific
value, as a pilot model in the
implementation of REGOM.
The project was funded by the
Bremen Overseas Research Development
Agency (BORDA) as
was proposed by the Yayasan Pelestari
Budaya Bangsa.
A globalization spirit indicates
an urgent need for an anticipatory
policy strategy that emphasizes
on empowerment of city external
functions. A counter strategy
which requires professionalism
and modern city management
quality is supported by strong political
will to build a ”fortress of
maritime spirit” of Bandar Nusantara
from Sabang to Marauke
in response to the upcoming
global era as the main target.
Bandar Nusantara is waiting
for a touch of participative development
as stated above. The
rebuilding of Sunda Kelapa reminds
us of the Baltimore revival
efforts during the economic recession.
The initiative launched
by Jakarta can serve as a lesson
for other Bandar Nusantara pilot
projects from Sabang to Marauke
that displayed an effort by
a city administration to implement
structural reforms as a survival
strategy to overcome urbanization
pressure and to preserve
culture.
The Genderang Bahari was
formed as a task force that carried
a patriotic mission called ’Kebangkitan
Semangat Bahari Indonesia’
or the Rediscovery of the
Indonesian maritime spirit under
a theme ’A decade of achievements
2010–2020’, with Bandar
Nusantara as a symbolic ”light
house” to welcome the challenging
global era in 2020.
The birth of Genderang Bahari
was spontaneous and took place
during the 65th commemoration
of Proclamation of the Republic
of Indonesia at Sultan Hotel, Jakarta,
initiated by maritime advocates
driven by the awareness
and the need to revive the maritime
spirit as a mandate which
is believed to have the power to
guide younger generations to face
the future with aplomb.
The idea was written down
during the commemoration of
Hari Nusantara on 13 December
DEVELOPING SUSTAINABLE INFRASTRUCTURE ACROSS THE PROVINCES
12 - 14 April 2011
Balai Sidang
Jakarta Convention Center
Jakarta, Indonesia
“We are committing USD 50 billion from a budgetary
standpoint for the development of infrastructure as part
of a USD 150 billion fi ve-year program”
HE Gita Wirjawan, Chairman of the BKPM
Knowledge@Wharton July 21, 2010
Indonesia International Infrastructure 2011 Conference & Exhibition (IIICE 2011) is the only event in Indonesia
to stage the full potential for sustainable infrastructure growth in each of the 33 provinces of the Indonesian
archipelago alongside national priority planned projects for tender by the central government.
Attend IIICE 2011 to review the full range of current and future infrastructure projects with Governors and Senior
Infrastructure Development Offi cials from the 33 Indonesian Provinces together with Central Government Senior Senior
Offi cials related to infrastructure development.
Don’t miss the opportunity to involve your company in the fi ve-year program
to develop infrastructure in Indonesia!
www.indonesiainfrastructure.org
The Genderang
Bahari was formed
as a task force that
carried a patriotic
mission called
’Kebangkitan
Semangat Bahari
Indonesia’ or the
Rediscovery of the
Indonesian maritime
spirit under a
theme ’A decade
of achievements
2010–2020’, with
Bandar Nusantara
as a symbolic ”light
house” to welcome
the challenging
global era in 2020.
2010 and is expected to touch our
hearts as citizens of an archiplegic
nation to reach the future with
greatness and glory of our marine
predecessors.
The writer is secretary general of
Genderang Bahari, a task force with
‘a patriotic mission to rediscover the
Indonesian maritime spirit’.

A4
January 17, 2011
The Economy
ECONOMIC UPDATES
RI, S. Korea agree to double
bilateral trade
Hatta Rajasa
Indonesia and South Korea have agreed
to double their bilateral trade over the next
five years.
The agreement was reached during a
bilateral meeting between President Susilo
Bambang Yudhoyono and his South Korean
counterpart Lee Myung-Bak on the sidelines
of the Bali Democracy Forum here last
month.
Trade between the two countries is at
around US$20 billion.
Coordinating Minister for Economic Affairs
Hatta Radjasa said South Korea had
also expressed its wish to increase its investment in Indonesia.
He said the decision to increase investment would only be known next
year after the establishment of a special team to identify investment potentials
in Indonesia that South Korea could exploit.
RI migrant workers’ remittances
reach US$5.03 billion
Bank Indonesia (BI) reported
that per September 2010,
Indonesia`s migrant remittances
totaled US$5.03 billion, up 2.44
percent from US$4.91 billion US
dollar in last year`s same period.
Difi A Djohansyah, a spokesman
of the central bank, said last
month that per September 2010,
Indonesia has sent 427,000
workers abroad, down 12 percent
from 479,000 workers in the
same period in 2009.
With the additional workers, the total number of Indonesian workers
abroad in September 2010 reached 4.32 million people.
Since 2005, Bank Indonesia in cooperation with the manpower and
transmigration ministry and the National Agency for the Placement and
Protection of Overseas Labor`s (BNP2TKI), has monitored the placement
of Indonesian workers abroad.
Sultan Thaha to become
international airport in 2012
Sultan Thaha Airport of Jambi Province is being developed into an international
airport in 2012.
“There will be major developments for the airport in 2011, initiated by
designing some facilities required for the airport,” the Head of Transportation
Office of Jambi Province, Benhard Panjaitan said last month.
The fund for the airport development and construction will come from
State Budget, Regional Budget and the budget of PT Angkasa Pura.
The runway, which will be 30 meters wide and 2,220 meters long, will
be expanded to 45 meters and 2,400 meters respectively.
The runway expansion is urgent as the airport planned to serve for big
airliners which require a runway with a width 35 meters and a length of
2,400 meters.
“One of the important facilities to realize the international airport is an
Instrument Landing System (ILS) to guide airliners while landing in bad
weather,” Benhard said
Two power plants in Jayapura
to operate in 2011
Two power plants which have been built in recent years by state electricity
company PT PLN`s Jayapura region will start operation in mid-2011,
director of PT. PLN, Dahlan Iskan, said here last month.
“It is hoped that in mid-2011 Holtekamp thermal power plant and Orya
hydropower plant will become operational,” he said.
“When these two power plants have become operational, PLN Jayapura
region will save tens of billions of rupiahs a month or half a trillion
rupiahs a year,” he said.
The Holtekamp thermal power plant is located in Muara Tami sub district,
Jayapura city and the Orya hydropower plant in Genyem sub district,
Jayapura district with a capacity of 200 megawatt each.
The highest growth
achievers in the
industrial sector
were transportation
vehicles, machinery
and their spare
parts that grew 8.47
percent, fertilizer,
chemical and rubbergoods
products (4.82
percent) and other
industrial goods (3.83
percent).
Coordinating Minister
for Economy
Hatta Rajasa said
last month that
Indonesia`s economy
is ranked 16th in the
world, above previous projections.
“The prospect of Indonesian
economy will be better
than previously projected,”
said Minister Rajasa.
The President Post www.thepresidentpost.com
RI Upbeat on 2010
Economic Performance
By 2030, Indonesian per capita income would
be US$17,000 based on the robust Indonesian
economy that has sustained consistent growth
since 1970
China has been reported
to become interested in
making an investment in
ports in Papua.
“On January 5, 2011, a
Chinese representative mission
will meet the Papua
administration in Jayapura,”
Transportation Minister
Freddy Numberi told the
press prior to an economic
evaluation meeting at the
economic coordinating ministry
here last week.
Freddy said China was in-
Industrial Growth in 2010
Expected to Surpass Target
MS Hidayat
Indonesia`s industrial growth
in the third quarter of 2010 was
recorded at 4.69 percent, boosting
confidence that the target figure
of 4.65 percent for the whole
year will be easily surpassed, Industry
Minister MS Hidayat said
last week.
“Considering the continuous
positive trend in industrial
growth until the 4th quarter
of 2010, we believe non-oil/non-
Citing Bank Indonesia data, he
said that the Indonesian economy
grew 6.0 percent in 2010 and
was expected to grow 6.5 percent
in 2011.
By 2030, Indonesian per capita
income would be US$17,000
based on the robust Indonesian
economy that has sustained
consistent growth since 1970, he
said.
“At the end of this year, the per
capita income will already reach
US$3,000. This figure is beyond
the target of the government,” he
said.
In addition to strong domestic
demands, the positive Indonesian
economy had also been influenced
by the recovery of the global
economy as reflected by the
growth in export since the fourth
quarter of 2009.
The recovery of the global
economy is seen by the performances
of industrialized countries
such as the United States
and Japan as well as regional economic
giants China and India,
all of which brought positive im-
pacts to their trading partners,
including Indonesia.
However, Minister Rajasa admitted
that the positive development
on the economic sector had
not had a positive impact on poverty
reduction in all regions of Indonesia.
“Therefore, there should be a
way out (to deal with poverty issues),
something that the central
government and regional governments
must address,” he said.
Poverty and unemployment
rates could not yet be reduced significantly
over the past years.
In 2005 poor people in Indonesia
amounted to 118 million,
or 53.8 percent of the total population.
China Interested in Building Ports in Papua
gas processing industries will experience
an above-target growth
rate,” Hidayat said at year-end
press conference here last week.
He said the non-oil/non-gas
processing industry sector had
grown significantly in 2010 compared
with 2009 when it grew
only 1.54 percent.
Industrial growth in 2010 had
also moved closer to the national
economic growth figure which
was recorded at 5.82 percent in
the third quarter of 2010.
“This shows that the industrial
sector has become a sufficiently
high source of growth in the
overall gross national product,”
said the minister.
The highest growth achievers
in the industrial sector were
transportation vehicles, machinery
and their spare parts that
terested in port projects in Papua
and West Papua.
He said the meeting discussed
Chinese investment opportunities
in Papua and West Papua.
The Papua governor will also
brief the Chinese mission on the
potentials in Papua.
Freddy said cooperation
with China is covered by a
government`s plan to promote
public private partnership (PPP).
Freddy added the meeting will
be attended by nine companies to
grew 8.47 percent, fertilizer,
chemical and rubber-goods
products (4.82 percent) and
other industrial goods (3.83
percent).
The industrial sector made
68.8 billion US dollars from
export of manufactured
products, or 62.07 percent
of the overall earnings from
exports, and 34.10 percent
higher than a year ago.
Investment in the industrial
sector was registered at
17.03 trillion rupiahs for domestic
investment (PMDN)
and 2.5 billion US dollars
for foreign investment during
the period.
The manufacturing industries
sector in 2010 employed
14.4 million people,
or an increase of 386,640
from the figure in 2009.
witness the potentials in Papua.
Besides companies having to
do with ports, he added, those
engaged in cement and mining
had also become interested in the
meeting.
He said China was also interested
in developing airports
there.
“The airports in Manokwari,
Jayapura, Sorong, and Biak will
be revived like in Mimika,” he
said.
He added that Papua will have
The government is targeting
the disbursement of Micro
Credit Support (KUR)
in 2011 to total Rp 18-20
trillion, up from Rp16.4 trillion
in 2010.
“Each year the amount
is increasing,” State-owned
Enterprises Minister Mustafa
Abubakar said in Jakarta
last weekend.
This year the government
has chosen six state-owned
banks, Bank Negara Indonesia,
Bank Rakyat Indonesia
(BRI), Bank Mandiri,
Bank Tabungan Negara,
Bank Bukopin, Bank Syariah
Mandiri and 13 regional
banks to distribute the micro
credit.
BRI recorded the biggest
credit distributor last year
with 9.7 trillion, or half of
new ports in Jayapura, Sorong
and Biak.
“The three areas are being prepared
to have new international
ports,” he said.
At present, he said, the construction
of basic infrastructure
has already started. He said the
coastal area will be reclaimed
with funds from the State Budget.
“We are hoping China would
take part in the development of
the region,” he said.
The Government has set
a target of rice production
amounting to 30.9 million
tons of dry grain for
January–April. Bulog will
absorb 2.5 million tons of
rice from farmers until May
2011.
Photo: The President Post/Nandi Nanti
Banking
Loans
Grow 22%
The amount of banking loans
extended in the year up to the
second week of December
2010 reached Rp1,708.15 trillion,
up 22.76 percent year-onyear,
Bank Indonesia (the central
bank/BI) said.
In the past week alone,
the amount of banking loans
reached Rp7.22 trillion consisting
of Rp4.04 trillion in rupiah
and Rp3.18 trillion in foreign
currency, BI spokesman Difi A
Johansyah said last week.
Difi A Johansyah
2011 Micro Credit
Target at Rp20 Trillion
Mustafa Abubakar
the total KUR.
Bank Mandiri distributed
Rp1.7 trillion during 2010. Half
of the total loans were taken out
by those in the agriculture and
animal husbandry sector with
42,000 debtors, while more than
35% of those loans were taken
out by those in the trade sector,
with more than 12,000 debtors.
According to Mustafa, since
KUR allocation began in 2007,
2.5 million tons
Target of Rice
As such, the amount of
banking loans rose Rp277.95
trillion or 19.43 percent year-todate
(ytd) and Rp316.73 trillion
or 22.76 percent year-on-year
(yoy), he said.
The increase in the amount
of banking loans in foreign
currency originated from four
groups of banks (private banks,
branches of overseas banks,
joint venture banks and regional
government-owned bank), he
said.
However, state-owned banks
recorded a Rp0.15 trillion decline
in the amount of banking
loans in foreign currency.
The central bank noted that
during the reporting week the
amount of banking loans in foreign
currency rose US$0.36 billion
with branches of overseas
banks recording the highest
increase of US$0.12 billion.
total credit received by micro
entrepreneurs amounted
to Rp33.4 trillion.
Soft loans were taken out
by more than 3.8 million
debtors, which employed 6.7
million workers.
The limit of the loans
without collateral varied to a
maximum of Rp20 million
per debtor, an increase from
the previous Rp5 million.
Microcredit is expected to
increase the number of Indonesian
entrepreneurs, which
is only 564,000 people or
0.24 percent of 163 million
people of working age.
“We need at least 4 million
new entrepreneurs because
we want to increase
competitiveness,” said Coordinating
Economic Minister
Hatta Rajasa.

www.thepresidentpost.com The President Post
January 17, 2011 A5
The Economy
Govt to Reduce Unemployment
by 0.5 percent in 2011
The government has set itself the target of
reducing the unemployment rate by 0.5 percent
from 7.5 percent in 2010 to 7 percent this year.
President Susilo Bambang
Yudhoyono
made the statement
when giving the
targets of national
development in the
2011 government plan of action
before all cabinet ministers, governors,
district heads, and mayors
at a working meeting here last
week.
President Yudhoyono also said
the government would also reduce
the poverty rate from 13
percent to about 12.5 or 11.5 percent
this year.
In connection with financial
resources, the head of state said
2011 state budget rose by 9.2 percent
from the last year`s budget to
Rp1,229.6 trillion this year.
But the president added that
the rise of state budget was balanced
by an increase in state revenue.
“Our state revenue rises 11.3
percent from that in the previous
year and it can reduce budget
deficit,” the president said.
Meanwhile, Finance Minister
Agus Martowardojo said
early this year that budget deficit
in 2010 state budget reached
only Rp39.5 trillion or 0.62 percent
from previous estimation of
Rp133 trillion or 2.1 percent.
He also said the remaining
budget financing (SILPA 2010)
was Rp47 trillion and corrected a
prediction of Rp23.2 trillion that
he made a week ago.
Beware of global issues
affecting RI`s economy:
President
Indonesians have been warned
to beware of global crisis issues
that could have a serious impact
on its economic growth, President
Yudhoyono said.
“We have to beware of three
crises that could trigger disputes
among global countries. They
are food supply, energy and water,”
the President said.
Floods that hit Australia the
size of Germany and France recently
is a sign of climate change.
It affected agriculture, mining,
and other economic sectors in
Australia and also have a serious
impact on the global economy,
Yudhoyono said.
Other global issues that might
have an impact on the global
economy are world peace and security,
global poverty, terrorism
and extremism, climate change,
and natural disasters, he said.
“We live in a dynamic world.
Therefore, we should be keen in
anticipating, gaining opportunities,
and facing challenges and
obstacles,” he said.
The meeting was attended
by ministers, governors from all
Indonesia`s provinces, and also
district and municipality heads.
The Gubernatorial Working
Meeting has been held four times
since Yudhoyono took office in
2009.
The theme of this 2011 meet-
The government would reduce the poverty rate from 13 percent to about 12.5 or 11.5 percent this year, said
President Yudhoyono at a working meeting here last week.
ing is `Fair and Just Economic
Growth Acceleration Supported
by Determination on Management
and Synergy between Central
and Regional Governments.
“RI more successful in
development in 2011”
“For the year 2011, we need
to be optimistic that our development
programs will be much
more successful. There are four
factors that enables us to boost
our country`s development,” he
said.
President Yudhoyono said the
first factor was related to the
country`s ongoing growth momentum.
The second factor is Indonesia’s
great potential to be an ad-
RI to Boost Non-Oil/Gas
Exports to Cover Trade Deficit
In 2010, Indonesia exported non-oil and gas product
10.6 billion US dollars, while imported non-oil and
gas products 16.59 billion US dollars.
Indonesia intends to export
more non-oil/non-gas commodities
in 2011 to cover its swelling
trade deficit with China, a trade
official said.
“The deficit can be lowered
by increasing exports, coupled
with efforts to improve the quality
and added value of the products,”
Vice-Trade Minister Mahendra
Siregar told the media
after accompanying Trade Minister
Mari Elka Peagestu in a
press briefing on export-import
performance at Trade Ministry
last week.
Siregar added that non-oil/non
gas trade imbalance with China
in the 10-month period of 2010
had surged compared to the same
period 2009 when the figure was
3.91 billion US dollars.
The soaring non-oil/gas trade
deficit with China in January-
October 2010, he said, was predominantly
caused by imports of
raw materials valued at 3.1 billion
US dollars and capital goods valued
at 1.7 billion US dollars.
If compared to non-oil/gas
trade deficit in the January-October
2008 period of 6.1 billion US
dollars, he said, the deficit over
the same period in 2010 is lower
as export was recorded surging
more than imports.
Siregar also said that non-oil
and gas export to China during
January-October 2010 period
was up 56 percent compared
with the same period of 2008
when import increased only 23
percent.
Total trade between Indonesia
and China in 2010 amounted to
28.2 billion US dollars, surging
40.6 percent compared to 2009
which was registered 20.07 billion
US dollars.
Non-oil and gas trade was the
largest which was valued at 26.52
billion US dollars.
In 2010, Indonesia exported
non-oil and gas product 10.6 billion
US dollars, while imported
non-oil and gas products 16.59
billion US dollars.
Overall, Indonesia underwent
a trade deficit 4.9 billion US dollars,
a 152-percent increase over
the deficit in 2009 which was valued
at 1.9 billion US dollars, according
to the Central Bureau of
Statistics (BPS).
Hatta: Climate, Oil Price Changes
Greatest Challenge in 2011
Coordinating Minister for
Economic Affairs Hatta Rajasa
said climate change and oil price
fluctuations would pose the biggest
challenge for the Indonesian
economy in 2011.
“Global climate change will affect
food and energy,” he said at
a new year press conference here
last week.
“The government would continue
stabilizing the price of food
through market operations and
increase stocks,” he said.
He said the government would
in the near future issue two pres-
idential instructions relating to
food price stabilization efforts.
One of the presidential decrees
would give flexibility to the National
Logistics Agency to procure
rice and the other one to the
agriculture minister to take actions
to overcome the impact of
climate change such as with regard
to fertilizer and seed supply.
“Economization in fuel consumption
would also be done.
So efforts will be made not only
in the supply but also in the demand
side,” he said.
He said fuel subsidy would still
continue but it would be aimed at
the right targets.
“Limiting fuel consumption is
a must while raising a fuel price is
not an option,” he said.
Agriculture minister Suswono
meanwhile said several countries
especially Thailand and Vietnam
have issued a warning that
they would reduce exports of rice
which will certainly spur international
price of rice.
“However if our rice production
could reach 68.8 million
tons it will not be necessary for us
to import rice,” he said.
vanced country.
The third factor related to
Indonesia`s success in handling
the impacts of world`s financial
crisis in 2008 and 2009.
The fourth factor was confidence
that Indonesia could resolve
problems and challenges
that it faced well, he said.
By considering the four factors,
the head of state said there were
no reasons for the government
not to remain confident in gaining
a success in its development
programs this year.
“For the year 2011, we
need to be optimistic
that our development
programs will be
much more successful.
There are four factors
that enables us to
boost our country`s
development.”
BI Governor:
RI Economy
Remains Strong
Bank Indonesia believes the country`s
economy will remain strong with its
gross domestic product in 2011 and
2012 growing by 6.3 percent driven by
strong domestic demand, especially
investment.
The central bank`s governor,
Darmin Nasution, said here last
week the Indonesian Balance of
Payment (NPI) in 2011 was predicted
to record a relatively big
surplus although it would be lower
than in 2010.
“Exports would still grow high
but import growth would be higher
in line with increasing domes-
Darmin Nasution tic demand to make the surplus
in the current account lower. On
the other hand, the financial and
capital current account is predicted to still record a high
surplus, driven by huge inflow of funds in the form of portfolios
or direct investment,” he said.
In the backdrop of the still uncertain global economic
and financial conditions the board of governors of Bank
Indonesia still believed the country`s economy could grow
6.0 percent in 2010.
The achievement was boosted by economic growth in
the fourth quarter of 2010 which was predicted to reach
6.1 percent or higher than in the previous quarter.
The growth is driven by strong domestic demand especially
household consumption and investment. The
country`s economic progress is also boosted by quite
solid external performance.
“The foreign currency reserves until the end of December
2010 were recorded at US$96.2 billion or equal to 7.1
months of imports and payments of government foreign
debts,” he said.

A6
January 17, 2011
The Region
It is becoming increasingly clear that the global
economy needs a strong Asian economy.
The world expects that Asia should move
more quickly to the epicenter of the global
economy. Asia should exist side by-side with
the Americas and Europe.
EAST ASIA
East Asia with China
in the lead is
widely considered
as a region on the
fast track during
the last two decades.
Asia has recovered from
the economic and financial crisis
in a significant way, much faster
than other countries in the global
economy. Thanks to China, real
GDP growth in developing East
Asia is poised to increase from
7.0% in 2009 to 8.7% in 2010.
According to World Bank data,
East Asia has emerged stronger
from the global crisis. More importantly,
rapid growth will be
possible in the coming years even
in a weakened global economy.
Hence, Asia is heading towards a
promising era as of 2011, particularly
in the economic and business
area. Such a positive developments
in Asia will be of special
interest to ASEAN, especially Indonesia.
The political and security areas,
however, are still in an unstable
and precarious state. There
are quite a number of issues to
worry about concerning not only
the north- eastern part of Asia because
of the Korean Peninsula issue
but also in the southeastern
region with the problem of the
South China Sea.
In ASEAN’s view peace and
prosperity goes hand-in-hand.
Without peace and political stability
there will be no prosperity.
And the other way around,
without prosperity there will be
no peace. It is therefore regrettable
that ARF (Asian Regional
Forum) has continued to be in
a limbo. Yet all the stakeholders,
the big powers and all the countries
in the region are members of
the ARF.
The area of economics and
business in Asia are in a much
more promising state. Asia is
heading towards an era filled
with both tough challenges but
also new opportunities, particularly
in the area of trade, finance
and services. The big historical
thrust is that the time has come
for Asia to move from the periphery
to the center of world economic
gravity.
ASEAN 2011
The year 2011 will be a highly
important year for Indonesia
as it will assume ASEAN’s chairmanship.
The ASEAN Summit
of the ten ASEAN leaders will be
held in April 2011 while the second
ASEAN Summit and East
Asia Summit (EAS), often called
ASEAN+8, is scheduled to be
held in Bali in October 2011.
These summit meetings will
give an opportunity for ASE-
AN, with Indonesia in the chair,
to demonstrate its continued capability
to remain in the driver’s
seat in Asia’s developments.
A cabinet meeting was held
on the 17th of December to prepare
for the forthcoming important
meetings. The cabinet meeting
was attended by the ASEAN
Secretary General.
Some important clues have
been given after the Cabinet
meeting by President Susilo
Bambang Yudoyono, Foreign
Minister Marty Natalegawa and
ASEAN Secretary General Surin
Pitsuwanwith with regards
to some of the issues which may
The President Post www.thepresidentpost.com
East Asian Economy
and Asean 2011 Objectives
By Atmono Suryo
come up during ASEAN 2011.
• To go global
The main theme for ASEAN
2011 would be “ASEAN Community
in a Global Community”.
This theme implies that
ASEAN will not only be active
in Asia but also assume a high-
er profile in world affairs.
Integration
• There is the need to establish
the ASEAN Community by
2015 supported by three important
pillars: Political-Security,
Economic and Socio Cul-
tural.
People-centered ASEAN
• Under Indonesian chairmanship
the objective would be
to bring ASEAN closer to the
people: to transform ASEAN
to become a “people-centered
Association”.
Politics and Security
• The East Asian Summit should
discuss and analyze political
and security issues in Asia. The
Summit includes powerful or
prominent countries such as
China, the United States, Russia,
Japan, India, South Korea,
Australia, New Zealand and
ASEAN.
Diplomatic Capital
• Indonesia will aim to develop
Jakarta into ASEAN’s “diplomatic
capital”.
It is good to see Indonesia’s
strong commitment to make
ASEAN 2011 a success. After all
it is often said that Indonesia is
losing interest in ASEAN. ASE-
AN and East Asia would need Indonesia’s
pro-active role in Asia.
On the other hand it is in Indonesia’s
interest to see a stronger
ASEAN.
It is of strategic importance for
ASEAN to establish and realize
the grand design c, namely political-security,
economic and the
socio-cultural. A more integrated
ASEAN would strengthen its
position in East-Asia, particularly
vis-à-vis the two giant countries
China and India.
The ASEAN+3 grouping
(ASEAN plus China, Japan and
South Korea) are the core countries
for the development of the
East Asian economy. The process
of economic integration in
ASEAN should pave the way
for a more integrated East Asian
community. As the Asian Development
Bank (ADB) stated in
one of their main research documents,
part of Asia’s success story
is also growing integration.
It is becoming increasingly
clear that the global economy
needs a strong Asian economy.
The world expects that Asia
should move more quickly to the
epicenter of the global economy.
Asia should exist side by-side with
the Americas and Europe.
The high-income countries
are expected to grow by 2.4% in
2011 and by 2.6% in 2012, while
East Asia and Pacific will grow by
8.5% in 2011 and 8,7% in 2012,
three times faster than the highincome
countries. East Asia is
thus catching up with the West.
The rapid growth of Asia is not
only an economic necessity for
the growth of the global economy.
It also reflects the historical
call to Asia to implement the shift
of global power from the West to
the East. “Asia is returning to the
center stage it occupied for eighteen
centuries before the rise of
the West”, Kishore Mahbubani
stated in his book “The New
Asian Hemisphere”.
Therefore, it It makes sense if
Indonesia would like to see ASE-
AN together with the countries of
Asia to go global. ASEAN Community
in a Global Community
is the proposed theme for ASE-
AN 2011. ASEAN with a strong
Asia alongside would be able to
play its positive part in the global
community of nations.
Internally, within ASEAN,
there is the need for people’s involvement
in the growth of the
South-Eastern part of Asia. People
often cynically ask, “what is
the meaning of ASEAN for us”.
There are still many frictions and
rivalries among the countries in
the region. This should come to
The rapid growth
of Asia is not
only an economic
necessity for the
growth of the
global economy.
It also reflects the
historical call to
Asia to implement
the shift of global
power from the
West to the East.
an end.
ASEAN, as an integral part of
Asia, should become a pro-people-centered
ASEAN that would
bring peace and security, prosperity
and welfare to the people, providing
them with greater employment
opportunities.
It is of strategic importance for
East Asia and the Pacific to have
a strong and solid ASEAN in
their midst, with Jakarta as ASE-
AN’s diplomatic capital, as proposed
by Indonesia.
The writer is a retired career diplomat
and former ambassador to the EU.

www.thepresidentpost.com The President Post
January 17, 2011 A7
ASEAN
ASEAN ECONOMY
As the East Asian
economy is moving
ahead quite strongly
with China and India
in the lead, there
is the need for ASE-
AN to develop a new economic
momentum to surge ahead in the
regional and global economy. In
order to revitalize ASEAN there
is the need to develop new paradigm
in some key areas.
Firstly, to strengthen and integrate
ASEAN’s economy to become
another “powerhouse” in
East Asia, and secondly to alleviate
its position and role in the
global economy not only in East
Asia but also in the wider global
economy. Such an objective
is in line with the ASEAN 2011
theme “ASEAN Community in
the Global Community”.
With Indonesia in the chair,
ASEAN intends to boost its external
political-economic relations
not only with the countries
in the ASEAN+3 grouping
(ASEAN plus China, Japan and
South Korea), but also with the
countries belonging to the EAS
(East Asia Summit) which now
includes India, Australia, New
Zealand , Russia and the United
States.
To put it in more popular
terms, ASEAN will not only
“go regional”; it also intends “to
go global”. Such strategy would
be for the interest of the ASE-
AN economy and ASEAN’s image
and standing in the world. It
will also support the expanding
East Asian economy with China
and India in the lead and in the
broader context to serve the interest
of the global economy.
ASEAN, as a regional economic
entity, is becoming a significant
economic force in East
Asia beside China, Japan and India.
It has become the 5th largest
economy in the world. In terms
of numbers ASEAN, with its total
population of 584 million
people, $1,5 trillion GDP, ample
human and natural resources
and with a record of significant
growth, ASEAN has the potential
to become another economic
force.
ASEAN: To Develop
a New Economic Momentum
ASEAN, as a regional economic entity, is becoming a significant economic
force in East Asia beside China, Japan and India. It has become the 5th
largest economy in the world. In terms of numbers ASEAN, with its total
population of 584 million people, $1,5 trillion GDP, ample human and natural
resources and with a record of significant growth, ASEAN has the potential
to become another economic force.
Single Production Base
Value in million US$
375,000
300,000
225,000
150,000
75,000
0
Agro-based
Source: ASEAN Trade Database
Country
Total land area
(sq. km)
As can be seen from the below
statistics (Figure 1) within
ASEAN Indonesia has the largest
GDP, the largest population and
the largest land area. Its Per Capita
GDP, however, is lower than
that of Singapore, Brunei Darussalam,
Malaysia and Thailand. It
is expected that Indonesia should
continue to play a leading and
positive role in ASEAN.
Not only in terms of population
and economic size, much of
ASEAN’s credibility and attraction
to the outside world is being
built on a number of developments,
which include among
others the following factors:
• It is ASEAN’s continued objective
to achieve peace, security
and stability in the South East
and East Asian region. This
is an important objective for
the development of the greater
Asia-Pacific region.
ASEAN continues to promote
• cohesion among the South
Eastern countries notwithstanding
the fact that ASEAN
faces diversity and divisions in
the region in the area of politics
as well as economics.
ASEAN is part of the Devel-
• oping East Asian region which
has come out stronger with
output expanding at near precrisis
rates and private invest-
ment on the rise.
ASEAN is in the midst of
• building up the grand-design
ASEAN Community 2015
supported by three pillars. An
integrated ASEAN would be
an attractive region for world
investors and traders.
ASEAN ECONOMIC
COMMUNITY
According to the AEC score
card, for the period 2008/2009
ASEAN has achieved the rate of
80.9%. On paper there is the possibility
that the 100% rate can be
achieved on time, but there is still
some doubts on this matter.
Judging from the observations
made at a recent ICWA seminar
held at the Financial Club, one
gets the impression that the progress
made in Indonesia to prepare
for the implementation of
the ASEAN Economic Community
is not too impressive. There
is even a great deal of pessimism
in the air.
ASEAN Population, Territory, and Economy (2008)
Total population
(thousand)
GDP at current market
prices
(US$ Mn)
There is the urgent need for Indonesia
to work harder on various
matters. Not only in the area
of the free flow of goods and services,
but also in the flow of capital
and investment and in particular
in the area of the free flow of
skilled labor.
Indonesia is still lagging behind
other emerging countries
in the area of competitiveness.
Indonesia’s world scoring is still
very low. In fact, among ASEAN
countries Indonesia is considered
to be on the low side. It will not
be easy for Indonesia to change
this unhappy situation.
Accordingly, there is a great
deal of uneasiness in the Indonesian
community, including in the
business community. It is feared
that Indonesia will not achieve
the goal of ASEAN Economic
Community by 2015. But Indonesia
as an important leading
country in the Association cannot
afford to lag behind.
SINGLE PRODUCTION BASE
ASEAN is moving to create a
single market and also a single
production base. A positive trend
to mention is the performance of
ASEAN’s total trade which grew
by 6.2% despite the global financial
crisis in 2008
It appears that ASEAN is most
successful in the area of electronics
(Figure 2). The output and
trade in electronics is by far bigger
than the other priority areas.
Next in line comes textiles and
apparels, the automotive industry
and agro-based sector. Rubberbased,
wood-based sectors and
the area of fisheries, which are of
particular importance to Indonesia,
are still at the lower end.
An area that is most likely not
known is skilled labor, which
covers the following groups: architects,
engineers, accountants,
surveyors, medical practioners,
including dentists and
nurses. The ASEAN Economic
Community will provide for the
free flow of skilled labor in areas
which are covered by Mutual
Recognition Agreements.
After 43 years of existence the
time has come for ASEAN to develop
a new momentum:
2000 2001 2002 2003 2004 2005 2006 2007 2008
Automotive Electronics Fisheries Rubber-based Textiles & Apparels Wood-based
(in US Million
PPP$)
GDP per capita
(US$) (PPP$)
Brunei Darussalam 5,765 397 14,147 19,133 35,623 48,180
Cambodia 181,035 14,656 11,082 27,986 756 1,909
Indonesia 1,860,360 228,523 511,174 901,139 2,237 3,943
Lao PDR 236,800 5,763 5,289 13,868 918 2,406
Malaysia 330,252 27,863 222,057 383,059 7,970 13,748
Myanmar 676,577 58,510 27,182 68,203 465 1,166
Philippines 300,000 90,457 166,773 317,215 1,844 3,507
Singapore 710 4,839 182,103 238,765 37,629 49,338
Thailand 513,120 66,482 273,729 546,320 4,117 8,218
Vietnam 331,212 86,160 90,701 242,697 1,053 2,817
ASEAN 4,435,830 583,651 1,504,236 2,758,385 2,577 4,726
CLMV 1,425,624 165,089 134,253 352,753 813 2,137
ASEAN6 3,010,207 418,562 1,369,983 2,405,632 3,273 5,747
By Atmono Suryo
The output and trade in electronics is by far bigger than the other priority areas. Next in line comes textiles and apparels, the automotive industry and
agro-based sector.
• To bring ASEAN closer to the
people, it must be transformed
from a bureaucratic association
to become a more “people-centered
“ association to get the
full support of the people.
• The entire ASEAN community
must be informed and
support ASEAN’s objectives,
including the question of ASE-
AN Community. The people
in the region must know of the
objectives and advantages of
closer economic integration.
• ASEAN, together with the
other emerging countries, deserve
to be in the forefront to
reshape and revitalize the global
economy through the G20,
WTO, UN agencies and other
international forums.
ASEAN has gone very far in
• developing various visions and
schemes, a multitude of roadmaps
and other directives. The
time has now come for on the
ground actions and implementation.
Throughout 2011 Indonesia
Photo: www.kompas.com
will have a golden opportunity to
show the world of its firm leadership
to revitalize ASEAN, and
that ASEAN is apt and ready to
play a positive and effective role
in the regional and global economy.
The writer is a retired career diplomat
and former ambassador to the EU.

A8
January 17, 2011
Education
Education is one of
the most frequently
discussed issues
in the world. Shaik
Baksh, the Minister
of Education
of Guyana, argues that education
is the backbone of all sectors
of the economy and the delivery
of quality education to a nation’s
children remains a top priority.
So, how do we define education?
Perhaps some people believe
that true education can only be
attained in a formal educational
institution. Others believe that
education comes in many different
forms and environments. A
definitive answer to that question
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GLOBAL EDUCATION:
Key to Global Competency in a Global Society
Education does not only encourage personal
development, it also offers general growth of an
entire community by providing a place for people
to interact, socialize and to unify their societies.
To unravel the problem
of education in
Indonesia, we need
to first identify categories
of problems
facing this nation
that is the category of policy, implementation,
capacity, facilities,
absorptive, and competition.
Simplistically it can be seen
that education policy has only
produced graduates who form a
pyramid—on top there are very
few graduates but way down to
the bottom there are so many.
According to Deputy Minister
of Education Prof. Dr. dr.
Fasli Jalal, there are currently 52
million students from all levels
throughout Indonesia, covering
about 4.5 million in college and
university level, 22.5 million at
the high school, and the rest at
the level of primary school and
kindergarten.
might not exist at all. Now, try
to leap ahead by thinking the real
purpose of education towards our
nation.
Many people believe that the
real purpose of education towards
a nation is to educate
youths to be responsible citizens.
Some, like Shaik Baksh, believe
that it is to develop individuals, as
well as society, in order to ensure
a society’s economic success. Few
others simply argue that the real
purpose of education has nothing
to do with the nation and is
simply focused on developing individual
talents and intelligence.
Even though their answers may
differ, they certainly agree that
PUBLISHED BY
PT Sarana Pratama Pengembangan Kota
CEO & EDITOR IN CHIEF
Ali Basyah Suryo
CONTRIBUTORS
Atmono Suryo
Cyrillus Harinowo Hadiwerdoyo
Thomas W. Shreve
Jeannifer Filly Sumayku
Eka Putri
education is a basic human right.
When that right is granted, the
growth and development of the
society as a whole is more likely
to prosper.
In 1990, UNESCO launched
EFA, the movement to provide
quality education for all children,
youth and adults by the year
2015. This quality education may
refer to the establishment of formal
and non-formal educational
institutions that adhere to global
needs and requirements, such
as English speaking competency,
global perspectives, technology
literacy, and many others.
In an attempt to bridge some
of the gaps that prevent Indonesian
youths to compete with
those from developed nations,
President University was established
in 2001. The University’s
big goal is to be a world class
learning institution that produces
leaders in their respective fields
and communities by educating
EDITORIAL & CIRCULATION
DEPARTMENT
Srimay Noviani
LAYOUT & DESIGN
Mohamad Akmal
SALES & MARKETING
Detia Rais
PHOTOGRAPHER
Nandi Nanti
By Jhanghiz Syahrivar
future generations through the
transfer of skills and knowledge
in order to build character and
wisdom.
The goal is supported by several
strategies that aim to reduce
some of the well-known gaps that
prevent people from becoming a
global community, namely communication,
human competency,
cultural difference, and technology
literacy; First, President University
knows the significance of
communication in today’s globalization
era—failure in communication
may lead to dramatic
multidimensional issues, such as
the class of cultures and religions.
Therefore, the University implements
English, the language
of the world, as the daily medium
inside and outside campus.
Hopefully, local students will be
able to interact with and understand
their foreign counterparts.
Second, President Universi-
Renew
Postal Code
ty provides a two-semester internship
program that enables
students to work in more than
its 1,500 global affiliates and to
grasp so-called ‘real-life working
experiences’ so that they can
compete globally. Thanks to the
program, it is hard to find its students
unemployed more than six
months after they graduate.
Third, President University
comingles local and overseas students
in one classroom to develop
knowledge and understanding of
other cultures and/or religions.
Every year, the University also
conducts a Cultural Night as an
introduction to a nation’s literature,
music, folklore, visual arts,
and popular culture. The event
could be used as a comparative
approach to help students understand
similarities among cultures
as well as the distinctive qualities
of societies. In the university,
global and international studies
are integrated and folded with
some courses, such as cultural diversity.
Lastly, President University
provides greater access to technology
to its students and narrows
the ever-widening digital divide
by granting internet access
in every corner of the campus. In
many ways, the most basic access
to technology can serve as a valuable
educational tool. Individuals
who are denied this access are
at a disadvantage when trying to
grasp opportunities to make life
better for themselves, their families,
and their communities.
All in all, global education
is important because the dayto-day
lives of average citizens
around the world are influenced
by burgeoning international connections.
The goods we buy, the
work we do, the cross-cultural
links we have in our own communities
and outside of them,
and increased worldwide com-
Disparity in Education Sector
Needs Comprehensive Treatment
Meanwhile, not more than
350,000 students graduate each
year from universities. These figures
prove that it is not easy for
Indonesian students to pursue
higher education.
The biggest obstacle is financial
difficulty due to low family
income levels while the cost of
education at universities cannot
be lower because of the need to
improve quality amid an increasingly
tight competition.
On the other hand, the pressure
from new registrants entering
kindergarten, elementary,
and secondary school continues
to grow every year.
The consequence that cannot
be overcome is low level of graduates’
employability both in quantity
and quality. In terms of quantity,
many graduates cannot “sell”
their expertise to industry so it is
difficult to get a good job.
In terms of quality, many employers
have laid off their workers
as there is increasing demand for
world-class human resources and
not the ones they have.
Policy implementation is another
problem. No matter how
good the policy, it will not produce
maximum results when implemented
by human resources
that are not capable.
Nevertheless, there is now some
home because the government of
President Susilo Bambang Yudhoyono
has begun to implement
a teachers certification program
for improving the quality of
teachers at various levels.
Education Minister Prof. Dr.
Mohammad Nuh said the government
needs to certify 50,000
teachers every year to fill the gaping
need for qualified teaching
personnel.
The minister said, out of 2.6
By Widya Sanjaya
million teachers in Indonesia,
more than 1.3 million still do
not have a minimum educational
qualification of S1 or D4. Up
to 71 percent of teachers are not
yet certified.
The next issue to be tackled is
capacity or capability of Indonesian
families to educate their children.
This is closely related to per
capita income level that has not
been uniformly strong.
As a result, it is not easy for
children from poor families to
continue their education to college,
without scholarship support
from the government and the private
sector.
The government needs to encourage
more national companies
(especially SOEs) and foreign
corporations to provide
scholarships through their corporate
social responsibility (CSR)
programs.
The number and types of
scholarships from local governments
in 33 provinces also must
be multiplied in order to fill the
scarcity of skilled human resources
at the provincial and district
levels.
Locally-owned companies
need to be encouraged to provide
scholarships to strengthen
the capacity of human resources
and provide opportunity for local
workers to build their respective
regions.
Another factor that causes disparity
in education is the issue of
educational facilities that have
not been spread evenly throughout
the country.
In big cities, many schools have
modern facilities to support the
teaching-learning process, but in
isolated areas, it is the opposite.
In urban areas many high
school and college campuses are
connected to the Internet so they
are very rich in data and information.
School and university
students never lacked data and
information; instead, they can accumulate
more than they need.
But in others areas, adequate
library resources remain a problem.
Such a situation has a direct
impact on the outcome of education.
In general, university curriculum
has never been properly
synergized with the needs of
businesses that create jobs. Consequently,
many university graduates
have difficulty getting in.
On the other hand, industries
do not “talk” with universities so
they do not understand what is
being taught in universities.
A number of private universities
in Indonesia have began using
faculty members from developed
countries like the United
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munication capabilities all contribute
to the imperative that responsible
citizens understand
global and international issues.
Education itself, in its essence,
is the foundation for the success
of any given society. Numerous
studies have shown that there is
a correlation between education
and lower birth rates, lower infant
mortality rates and fewer
maternal deaths. A more educated
population will also result in
higher personal incomes as they
all have more access to financial
opportunities. Education does
not only encourage personal development,
it also offers general
growth of an entire community
by providing a place for people
to interact, socialize and to unify
their societies.
Jhanghiz Syahrivar is a Senior
Education Consultant and an
Assistant to Lecturer of Faculty of
Economics, President University
States, Canada, European countries,
Australia, and some prominent
countries in Asia, including
India, Japan and the Philippines.
Their presence also provides
a new culture in the academic
world in Indonesia. They have
also brought along a variety of
best practices to be implemented
in Indonesia.
However, in line with that, the
cost of education that must be
borne Indonesian students will
increase because foreign expatriates’
presence is costly.
All these factors influence the
progress of education in Indonesia.
What is needed now is concerted
efforts to create competitive
advantages for the country
that is growing fast in all sectors.
Due to that the government
needs to apply a comprehensive
strategy to elevate Indonesia’s human
resource potential to a higher
level.

Business B
Production level of PT Pusri
over two million tons
PT Pusri in Palembang has reached a production
of 2,050,000 tons, said President Director of
PT Pusri Ir Arifin Tasrif in Palembang, South Sumatra,
last month.
He said the fertilizer production has faced
many disruptions as stocks had been accumulating
forcing the factory to lower its production
capacity.
The storage facilities are already full, and transportation
by Musi river has become inefficient,
while the use of fertilizers was below the target
set by the agriculture ministry, he said.
In the meantime, the long and incessant rains in addition to the switch
of the planting season had a serious effect on the use of fertilizers.
Chandra Asri to build
butadiene plant
PT Petrokimia Butadiene Indonesia (PBI), a subsidiary of petrochemical
producer PT Chandra Asri, will soon build a butadiene plant, the first of
its kind in Indonesia.
“We have set aside $100 million to build a (butadiene) plant with a capacity
of 100 thousand tons per year,” PT Petrokimia Butadiene Indonesia
Director Suhat Miyarso said last month.
The plant will be built on 40,000 square meters of land in the PT Chandra
Asri factory compound in Cilegon, Banten province, he said.
“We are currently preparing a bidding process to decide an EPC contractor,”
he said.
He said PT Petrokimia Butadiene Indonesia has extended an invitation
to a number of companies in South Korea, Japan and Italy, to file a bid for
the project until March 2011.
Photo: www.tradenote.net
Butadiene
BUSINESS BRIEFS
23 – 25 MARCH 2011
BALAI SIDANG
JAKARTA CONVENTION CENTER
INDONESIA
The President Post
www.thepresidentpost.com
Display until February 17, 2011 /// N0. 20
JAKARTA INTERNATIONAL DEFENSE DIALOGUE (JIDD)
Hosted by:
Ministry of Defense
Republic of Indonesia
Organized by:
IDU-Indonesian
Defense University
FOR THE FIRST TIME IN JAKARTA THE MINISTRY OF DEFENSE, REPUBLIC OF INDONESIA WILL HOST OFFICIAL DEFENSE
DELEGATIONS FROM OVER 40 COUNTRIES TO MEET AND DISCUSS STRENGTHENING SECURITY AND STABILITY
JAKARTA, INDONESIA IS THE NEW CENTER FOR SECURITY AND DEFENSE DIALOGUE AND IMPLEMENTATION
SUPPORTING SHOWCASE ALONGSIDE JIDD 2011
23-26 MARCH 2011
BALAI SIDANG
JAKARTA CONVENTION CENTER
JAKARTA INDONESIA
State Companies Control
26 pct of Stock Market Capital
State Enterprises Minister Mustafa Abubakar
considered the control of 26 percent of the stock
market`s capital by the state-owned companies
as very good in view of the fact that the number of
state-owned companies in the market comprised
only four percent of the total number of companies
listed at the BEI (421).
Seventeen stateownedcompanies
listed at the
Jakarta Stock
Exchange (BEI)
control 26 percent
of the market`s total
capital, State Enterprises
Minister Mustafa Abubakar
said.
“Until December 29,
2010, the total value of market
capital reached Rp3100
trillion and Rp819 trillion
of it or 26 percent are controlled
by state-owned companies,”
he said at a year-end
press conference at his office
here on Friday.
He said communication
operator Telkom held the
biggest share in the stock
market`s capital at Rp161.2
billion, followed by Bank
Mandiri (Rp137.1 billion),
Bank Rakyat Indonesia
(Rp129.4 billion), Perusahaan
Gas Negara (Rp106
billion), Bank BNI (Rp71
billion), Semen Gresik
(Rp56.6 billion) and Bukit
Asam coal mining company
(Rp52 billion).
Most of the 17 state-owned
companies recorded positive
share movements in the past year
with construction company Adhi
Karya recording a price growth
of 122 percent, Wijaya Karya
(112.3 percent) and Bank BNI
(103.1 percent).
Only two state-owned companies
recorded negative share price
growth in the past year, namely
telecommunication company PT
Telkom at 15.3 percent and pharmaceutical
company Indo Farma
minus 3.6 percent.
Mustafa said the price of
Telkom shares dropped because
the company was also listed in
New York and therefore the price
of the company`s shares was also
affected by the crisis that hit capital
markets in Europe and the
US. Mustafa considered the control
of 26 percent of the stock
market`s capital by the stateowned
companies as very good in
view of the fact that the number
of state-owned companies in the
market comprised only four percent
of the total number of companies
listed at the BEI (421).
In addition, he said, seven of
the state-owned companies were
among the 20 listed companies
with the greatest amounts of capital.
Nine state firms suffer losses
this year
Nine state-owned companies
suffered a total loss of Rp483 billion
this year, Abubakar further
said.
“The figure fell from 22 the
year before,” he said.
The nine state firms are plan-
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tation company PT Perkebunan
Nusantara XIV, paper producer
PT Kertas Kraft Aceh, shipbuilder
PT PAL Indonesia, aircraft
maker PT Dirgantara Indonesia,
textile producer PT Industri
Sandang Nusantara, insurance
firm PT Asuransi Kredit Indonesia,
shipping company PT Pelni,
state publisher PT Balai Pustaka,
and paper producer PT Kertas
Leces, he said.
“In 2011 we aim to reduce
the number of state firms suffering
losses to 4-5. In 2012 all state
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Communication operator Telkom held the biggest share in the stock market’s capital at Rp161.2 billion.
firms are expected to make profit,”
he said.
The State Enterprises Ministry
was committed to restructuring
state firms suffering losses by
involving state asset management
company PT Perusahaan Pengelola
Aset (PPA) and the stateowned
companies concerned, he
said.
“So far, we have managed to
rescue a number of state firms including
Merpati and Semen Kupang.
Both of them have now
made a profit,” he said.

B2
January 17, 2011
Business
REI estimated that
up to December
2010 realization of
welfare houses by
its members across
the country reached
120,000 units with
most consumers using
housing credits from
BTN Bank.
After exceeding this
year’s production
target, PT Pertamina
EP was ready to
increase oil production
from 130,200 barrels
per day in 2010 to
132,000 barrrels per
day next year.
REI: Property Sector
to Grow 15 percent in 2011
Real Estate Indonesia (REI)
is optimistic the property sector
will grow by up to 15 percent in
2011 compared to 10-12 percent
this year.
“The key to the property
sector`s growth for middle-
and low-cost houses is in regulations
and next year the problem
is expected to be finished while
the macro-economic condition
would also be good. So we are
optimistic the sector will grow
that high,” REI`s general chairman
Setyo Maharso, told newsmen
here last month.
He said the development of
middle- and high-cost houses
meanwhile would fully depend
upon market mechanism and the
condition of the country`s macroeconomy.
Referring to several macroeconomic
indicators such as the
stable rupiah exchange rate at
around Rp9,100 per US dollar
and controlled rate of the SBI despite
high inflation Setyo said he
was optimistic the predictions
would be met.
“The 4.5 percent growth in
2009 was already enough to
The President Post www.thepresidentpost.com
bring stability on the property
market. Now in 2010 the economy
is projected to grow up to 5.90
percent. This is even better. The
World Bank meanwhile predicts
Indonesia`s economy will grow
6.2 percent in 2011,” he said.
He said the banks that distribute
house credits (KPR) have also
varied and provided affordable
interest rates for consumers.
For the middle and low class
the government meanwhile has
provided a Housing Financial Liquidity
Facility.
“So if the regulations are al-
Pertamina Needs New Technology
to Meet Production Target
To boost its production in
2011, PT Pertamina EP, a subsidiary
of state oil and gas firm
PT Pertamina, needs not only to
find new reserves but also a new
exploration concept and technology,
an analyst said.
“In theory, there are two conditions
Pertamina EP must meet
to achieve its production target
for 2011, namely new potential
gas and oil blocks or basins and
breakthrough in oil and gas exploration
technology,” Dr Iskanda
Zulkarnaen, a geotechnology
analyst at the Indonesian Insti-
tute of Sciences (LIPI), said here
last week.
He said the conventional exploration
technology used so far
could not optimally explore oil
and gas basins in Indonesia.
“There are 60 basins in Indonesia
but only few of them hold
viable oil and gas reserves. But
with new technology it will be
possible to find reserves not only
in basins but also in existing subbasins,”
Iskandar said.
Therefore, a new exploration
concept was essential for Pertamina
EP to find hidden oil and gas
potentials in the basins, he said.
However, new technology
might not be cheap and is kept
by certain parties to gain more
profit from the oil and gas sector,
he said.
Previously, after exceeding this
year’s production target, PT Pertamina
EP was ready to increase
oil production from 130,200 barrels
per day in 2010 to 132,000
barrrels per day next year.
Its president director, Salis
Aprilian, said that crude and condensate
production in 2011 was
expected to reach 132,000 bar-
Fuel Restriction
BPH Migas deploys a
special team to control
the implementation of the
restriction policy on fuel and
gas subsidies consumption
as of April 2011.
Photo: The President Post/Nandi Nanti
ready in place what should we
wait. This is certainly positive,”
he said.
REI estimated that up to December
2010 realization of welfare
houses by its members across
the country reached 120,000
units with most consumers using
housing credits from BTN
Bank.
Realization of houses built using
subsidized and non-subsidized
credits from BTN until
September 2010 reached 107,673
units with payments reaching
Rp7.4 trillion.
rels per day or a rise by 1.4 percent
from 130,000 barrels per
day in 2010.
“However because of a natural
decline of 18 percent, production
actually increased by 20 percent,”
he said.
The quite steep drop happened
because most of the oil wells were
old and some of them had even
produced 30 percent less, he
said.
Moreover, Salis said, gas production
in 2011 was expected to
reach 1,095 million cubic feet per
day (MMSCFD) up from 1,054
MMSCFD in 2010.
Conoco Phillips prepares
To drill in Aru Islands
PT. Conoco Phillips is preparing to do exploratory drilling
in the offshore Amborit block 6 in Aru Islands district, a local
energy official said.
The foreign oil company had already installed its drilling
equipment with its exploration activity scheduled to start at the
end of December 2010, Bram Tomasoa, the head of Maluku`s
energy and mineral resources office, said.
He said his office, a PT.Conoco Phillips team and the Oil
and the Gas Regulatory Agency (BP-Migas) had conducted
a familiarization meeting on the development of the Amborit
block 6 for the local community in Dobo, Aru Islands district`s
capital, last December 10, 2010.
“The familiarization effort was made in cooperation with
Maluku`s legislative council and the Aru Islands`s district regional
task force as well as local community leaders and people
at the drilling location in South Aru Tengah sub-district in
order to build an understanding for investment activities which
require large budget,” he said.
Bram said the funds for the exploration drilling was to be
provided by PT.Conoco Phillips in compliance with the provisions
and conditions stipulated by the central, provincial and
district administrations.
“I was told the Aru Islands district administration had received
more than Rp32 billion for various arrangements ahead
of the exploration drilling under an Energy and Mineral Resources
Ministry license,” he said.
Bram said the funding also came from the contribution of
PT Conono Phillips which had obtained a permit from the Energy
and Mineral Resources Ministry for exploration drilling in
the Arafura Sea block in North Aru Selatan sub district which
was scheduled to begin in January 2011.
“So if the exploration drilling turns out to have economic
value, the Aru Islands district administration will receive a great
share of the oil and gas produced,” he said.
Local firms to take over
Siak block from Chevron
A number of regional government-owned
companies
(BUMDs) in Riau province
plan to take over the management
of Siak oil block
from PT Chevron Pacific Indonesia
whose contract will
expire in 2013.
“There have been several
BUMDs expressing interest
in managing the Siak Block
after Chevron`s contract expires
in 2013,” spokesman
for the Upstream Oil and Gas Executive Agency (BP MIgas)
Elan Biantoro said last month.
Chevron, formerly Caltex, signed a 22-year production sharing
contract for the operation of the oil block in 1991.
The company earlier operated the block under a contract of
work signed in September 1963. The block currently produces
2,000 barrels per day.
He said BUMDs had a wide chance to manage the block
the more so because the central government had been committed
to giving priority to BUMDs.
To date, there are two BUMDs in Riau managing oil blocks
taken over from Chevron. They are PT Bumi Siak Pusako-Pertamina
Hulu which manages Coastal Plain Block in Pekanbaru
and PT Sarana Pembangunan Riau which manages Langgak
Block.
He said the BUMDs had a wide chance to take over the oil
block since Chevron had not applied for the extension of the
contract until mid 2010. However, the company still could apply
for the extension of the contract until 2011 at the latest.

www.thepresidentpost.com The President Post
January 17, 2011 B3
Investment
INVESTMENT BRIEFS
Australian investor to build
50 villas in Lombok
An Australian company plans to build 50 villas of international standard
in South Lombok marine tourism resort in West Nusa Tenggara province,
a local official said.
“The Australian company will build villas in Seger Kuta beach and
Benang Kelambu natural tourist resort in North Batukliang subdistrict,”
Central Lombok District Head H.M.Suhaili FT said last month.
The construction of the villas will employ Singaporean architects who
are accustomed to designing building structures in the United States and
China, he said.
Minister sees capital inflow
for direct investment rising
Hatta Rajasa
Chief economic minister Hatta
Rajasa said he believed foreign
capital inflow for direct investment
would rise this year.
“In 2011 it will increase by
more than US$12 billion,” he said
here last week.
He said in 2010 the capital
inflow for direct investments
reached US$12 billion and for
portfolios US$16 billion.
On the government`s plan to limit consumption of subsidized fuels, the
minister said limiting fuel oil consumption was not the same as raising its
price.
“A fuel price hike only affects fiscal matters. If it is done it will impact all
people, including the poor,” he said.
Hatta said the government would approach the issue in fiscal as well as
sense of justice terms so that the policy to be adopted would only affect
selected segments of the people.
“If only a fiscal approach is used it will be enough to just raise the price.
The law however states that the government should continue to subsidize
the economically weak segments of the population,” he said.
SE Sulawesi province, private
sector to build nickel plant
The Southeast Sulawesi provincial
administration established
cooperation with foreign and national
companies to build a nickel
processing plant in the region.
“The cooperation is contained
in a memorandum of understanding
between Jilin Horoc
Nonferrous Metal Group Ltd of
China and PT Billy Indonesia on
Nur Alam
December 15, 2010,” Southeast
Sulawesi Governor Nur Alam
said here last month.
Nur said under the MoU, Jilin will keep $100 million at Bank Pembangunan,
Southeast Sulawesi office, before building a stainless steel plant.
HK allocates $50 m
for investment in RI
The Hong Kong government
has allocated US$50 million for
its investment in Indonesia until
next year, an Indonesian diplomat
said here.
“Indonesia must be able to
provide various facilities so that
the investment funds will not
go to other countries instead,”
Teguh Wardoyo, Indonesian consul
general in Hong Kong, told Teguh Wardoyo
Antara last month.
He said that up to now about $34 million had been absorbed with the
remaining $16 million put on hold.
Investments in Mining
in 2010 Reach US$2.2 b
Investments in
the mineral and
coal mining sector
in 2010 reached
US$2.282 billion,
according to the
ministry of energy and mineral
resources.
The ministry`s director
general of minerals and coal,
Bambang Setiawan, said
here last month the realization
was above the target set
at US$2.119 billion.
“General mining performed
well,” he said.
Three investors are planning
to build hotels in Denpasar,
Bali, which are expected
to overcome a shortage
of 1,600 hotel rooms in the
past two years, a tourism official
said.
“There are three investors
He said the realization of minerals
and coal investments until
November 2010 was US$1.865
billion.
It came from working contract
investments totaling US$1.07
billion, coal mining working
agreement-based investments
(PKP2B) US$0.756 billion, mining
authorities including stateowned
companies such as PT Timah
Tbk, PT Antan Tbk, and
PT Bukit Asam Tbk, US$0.038
billion.
Until the end of December
2010, investments rose to
applying for permits to build new
hotels,” Head of the Denpasar
City Tourism Office Putu Budiasa
said last month.
One of the investors comes
from Poland, he said without
elaborating on the total investment
of the three hotels.
He said the local authorities are
still processing the applications
from the three investors.
If they meet requirements the
tourism office would soon issue
in-principle approval to them so
they could begin the construction
of the hotels in 2011, he
said.
US$2.282 billion. It consists of
investments from working contracts
US$1.479 billion, PKP2B
US$0.764 billion and from stateowned
companies US$0.038 billion.
Investments in mining service
business reached US$904.82
million in 2010, making total
investments in the sector to be
US$3.186 billion.
Bambang said the total investments
did not as yet include
those for mining activities whose
licenses are produced by regional
governments in various regions.
Three Investors to Build
Hotels in Denpasar
Two of the hotels
will be built on
the Sanur beach
and the other
in the heart of
Denpasar city.
“But we still have to consider
their financial capacity first. Let`s
wait and see the further developments,”
he said.
Two of the hotels will be built
on the Sanur beach and the other
in the heart of Denpasar city.
“Hopefully, the presence of the
three new hotels will overcome a
shortage of 800 hotel rooms in
Denpasar,” he said.
The city administration had
set itself the target of raising the
number of hotel rooms by 1,800
in 2010 and 2011.
He said 1,000 of the targeted
1,800 hotel rooms had been built
this year.
Indonesia hopes Singapore’s
investment in Indonesia will
rise by up to 50 percent in
2011, chief economic minister
Hatta Rajasa said here last
week.
“Singapore’s investment
in Indonesia in 2010 was recorded
at around five billion
US dollars. We hope it will
increase up to 50 percent,”
he said after meeting with
Singapore`s minister of trade
and industry Lim Hng Kiang.
He said investment was one
of the issues discussed by the
working group in the framework
of economic cooperation
between the two countries.
The two countries have
agreed to focus their cooperation
on the fields of infrastructure,
connectivity, ports and
manufacturing sectors.
“Singapore as an international
financial hub is expected
to promote investment opportunities
in Indonesia,” he
said.
The working group that has
Rising
Property
Turnover
Ministry of Public Housing
estimates the turnover of
property in 2011 will rise
by about 12% to Rp 100,8
trillion, up from 2010’s
projeced figure of Rp 90
trillion.
Photo: The President Post/Nandi Nanti
RI Hopes Singapore’s
Investment to Rise 50%
been set up by the two countries
also deals with development in
Batam, Bintan and Karimun, air
transportation, human resources
development and agribusiness.
Hatta said the development in
Batam, Bintan and Karimun has
shown progress while obstacles
in licensing, customs and others
had been reduced.
“We have agreed to increase
the promotion of the region so
that it could become an investment
destination. This must become
a success story,” he said.
On air transportation, Hatta
said the Association of Southeast
Asian Nations (Asean) would issue
a connectivity blueprint in
the framework of establishing an
ASEAN economic community.
He said an agreement has also
been reached with regard to improving
the skills of the Indonesian
human resources in Singapore.
“In the agribusiness Singapore
meanwhile will keep increasing
supply of vegetables from Indonesia.
It is expected to grow 20
percent,” he said.
Photo: www.foggodyssey.com
Singapore`s investment in Indonesia in 2010 was recorded at around
five billion US dollars.

B4
January 17, 2011
Markets
In the midst of rapid capital
inflows and improving
perceptions on the
economy lies an opportunity
to enhance the
country’s strategy on fiscal
financing.
Capital inflows are likely to
remain a very warm issue for
next year. Given the unsustainable
debt levels in the developed
world, as well as the uncertain
growth outlook thereat, emerging
markets will continue to be
a haven for cross-border investment
and yield seeking.
In 2010, Indonesia saw breathtaking
amounts of capital inflows.
During the first three
quarters of the year, for example,
foreign direct investment and financial
market capital inflows
reached a record high US$23 billion
(or around 3 percent of the
size of the economy).
Accordingly, the portion of local
currency bonds owned by foreign
investors continues to rise
and, at around 30 percent, is currently
the highest in the region.
Given Indonesia’s shallow financial
markets, there is obviously
a scarcity of available local
currency financial instruments,
especially when it comes to the
huge influx of foreign funds.
Of course, on one hand this
condition leaves us prone to high
levels of volatility, not to mention
asset price bubbles. But on the
brighter side, the scarcity of instruments
also gives the government
(as a key supplier of bonds)
an upper-hand in the markets.
Bond yields are at historical
lows and selling debt has become
a much easier task. The
government now has more freedom
when it comes to issuing papers
for financing the fiscal deficit.
This change in landscape is
actually giving room for us to revisit
the traditional paradigms in
managing budget finances.
Honestly, although debt management
has seen many improvements
in the way it is run, things
haven’t been exactly perfect.
At the end of every fiscal year, a
good portion of the funds raised
from bond financing ends up unused.
At the end of 2008, for example,
funds raised in excess of what
was needed reached a staggering
Rp 80 trillion. This was repeated
in 2009 with Rp 40 trillion,
and probably another significant
amount this year.
Over-financing is very inefficient
and wasteful, as taxpayers
must pay a fortune to cover interest
payments on an idle loan.
For example, the average yield
on bonds issued in 2008 was
around 11 percent per annum.
We can easily calculate that from
a principle of Rp 80 trillion, the
redundant interest payments can
potentially reach trillions annu-
The President Post www.thepresidentpost.com
FISCAL POLICY
Time to Reduce Interest Payment Costs
The prudent fiscal
policies in which the
government has held
dear for so long are
finally bearing fruit. The
opportunity has risen
to put things further to
our advantage. Now is
the time to take it.
By Helmi Arman
ally, equaling the annual cost of
putting hundreds of thousands of
impoverished children through
school.
This tendency to over-finance
stems from many structural reasons;
one is a chronic tendency to
underachieve the spending target
on infrastructure. To fix this requires
addressing many structural
problems, such as land acquisition,
which could take some
time.
It’s high time for
this to change.
The government
should, first,
reconsider
its strategy of
frontloading and
second, start using
more short tenor
bills (that mature
within the fiscal
year) to minimize
interest payments.
However, what we can realistically
aim for 2011, in regard to
reducing the likeliness and cost
of over-financing, is to add more
flexibility to the financing side.
We can see the extent of overfinancing
all this time has been
made worse by the government’s
debt management strategies to
mitigate the so-called refinancing
risk; i.e. the possibility of being
unable to borrow and repay
existing debt.
The refinancing risk was indeed
a big issue five or 10 years
ago in the years of recovery from
the 1998 financial crisis. In order
to reduce this refinancing risk,
the government’s rule of thumb
on debt management has been to
issue bonds with a maturity of as
long as possible, as soon as possible.
Under the so-called strategy of
“frontloading”, huge amounts of
debt are sold in the early months
of every year. Longer tenor bond
issuances have also become a high
priority over shorter tenor bonds.
The average maturity of the
government’s bond portfolio has
been maintained at around eight
years, which looks high even at
regional standards.
According to data from the
Asian Development Bank, peer
countries such as China, South
Korea, Malaysia, the Philippines
and Thailand all have more outstanding
short-tenor debt (one to
three years) than they do longtenor
debt (more than 10 years).
Only in Indonesia does the reverse
apply.
Of course, this doesn’t mean we
must follow everything the others
do. But considering Indonesia’s
chronic and wasteful excess
financing problem, continuously
prioritizing the sale of long-term
bonds increasingly looks like a
costly strategy.
It’s high time for this to change.
The government should, first, reconsider
its strategy of frontloading
and second, start using more
short tenor bills (that mature
within the fiscal year) to minimize
interest payments.
A lot has changed since 2005.
The refinancing risk should no
longer be the major concern as
Indonesia’s fundamentals have
improved, and investment grade
status is within a couple of years’
reach. All this is leading to an era
of easier access to financing.
Generally, the government
should no longer be too concerned
about the prospect of being
locked out of the markets and
unable to fund the budget deficit.
In this regard, the additional
cost incurred from issuing
long tenor instead of short tenor
is starting to look less justifiable.
Given the current shape of
the yield curve, issuing a one-year
bill in place of a 20-year bond can
reduce the annual interest payment
by a staggering 3 percentage
points.
The issuance of more shortterm
T-bills should also be taken
in the context of deepening the
market. Local banks have hundreds
of trillions in excess liquidity
that the government could tap
into. Cooperation with Bank Indonesia
in using T-bills as a monetary
instrument (which has
stalled for years) should again be
restarted.
The government can even go
further to introduce very short
tenor T-bills, with a maturity of
less than a year, for bridging the
seasonal financing gaps that stem
from time differences in spending
and revenue collection.
For example, issuing one- and
three-month T-bills instead of
long-term bonds to bridge the early-year
cash shortage would likely
be much more efficient. Not only
are T-bills cheaper in cost, they
could also be timed to mature in
April when money from tax collection
fills up the government’s
coffers. This way the chances of
paying excessive interest on idle
money just might be significantly
reduced.
The prudent fiscal policies in
which the government has held
dear for so long are finally bearing
fruit. The opportunity has
risen to put things further to our
advantage. Now is the time to
take it.
The writer is an economist at Bank
Danamon Indonesia. The views
expressed herein are personal.

www.thepresidentpost.com The President Post
January 17, 2011 B5
Technology
Getting Ahead
How Indonesia is Using ICT
to Boost its Standing Among
its Neighbours
“If IT infrastructure in the larger parts of the country can be improved, good education can then be delivered through
e-learning to the remote areas and isolated islands, so that the gap on the quality of education among different parts
of Indonesia can be reduced.” - Sutanto Hartono (President Director PT Microsoft Indonesia)
The Indonesia’s government
believes
that IT is an essential
driver of
competitiveness
and national economic
growth. ICT initiatives
by Indonesia’s government: Establishment
DETIKNAS (National
ICT Council) to create
ICT based framework and blueprints
as a foundation for every
government agencies to collaborate
with more efficiency, better
transparency and better collaboration,
Palapa Ring program in
ICT that would connect many
big cities inter-island (national
network) via fiber optic cable.
The technology of the network
is circuit switch or IP based network.
Microsoft concurs that IT
plays a significant role and as
the world’s largest software company,
we have the global experience
and innovative technology
to partner with the government
to advance national priorities and
in turn accelerate our business.
Microsoft contributes to people
development through teacher
and student education programs,
partner education, local IT software
industry development, innovation
centres and training.
Some of our “mindshare competitors”
have made significant
foreign direct investment in line
with their manufacturing business
model, however we want to
move the conversation away from
physical investments to the importance
of developing Indonesia’s
human capital.
According to President Director
PT Microsoft Indonesia, Sutanto
Hartono, Indonesia has
infinite potential to increase its
national competitiveness. First,
being one of the most stable economies
in the region, Indonesia has
the economic capacity to create a
high standard of living for its citizens.
Second, it has an extensive
high quality labour force, so it
has the human resources needed
to support innovation. Thirdly, it
has abundant natural resources,
especially in oil, gas and minerals.
All these factors support the
nation’s quests to be more competitive
in the regional and global
level. In spite of these advantages,
Indonesia is still facing a lot of
challenges. One major challenge
faced by Indonesia is its digital divide
– due in part to the dispersed
geography and wide gap in socioeconomic
levels.
Around 40 million Indonesians
use the internet, and yet internet
penetration is still low, at
17 percent. The Indonesian government
wants to push that figure
to 50 percent by 2015. This
year, The Center for Rural Telecommunication
and Informatics
(BTIP) of Directorate General
of Postel, US$38 million in
an effort to connect the country’s
72,000 villages with broadband
internet cabling.
Technology providers are playing
a key role in the digital inclusion
effort. Through technological
milestones and strong
partnerships with governments,
NGOs, educators and academics,
Microsoft has come up with the
Citizenship ‘Unlimited Potential’
programme, an initiative focused
on delivering solutions in education,
innovation and job opportunities
– three interrelated areas
that are fundamental to economic
growth. In other words, Microsoft
is tapping the unlimited
potential, or in Bahasa Indonesia,
the ‘potensi yang tak terbatas’
of technology, to bridge the digital
divide and boost Indonesia’s
competitiveness.
For example, Microsoft has
been working hand-in-hand
with the government and other
key stakeholders to transform
education in the country. “Indonesia
is spread out in 17,000 islands
and IT infrastructure development
has been focused in
the big cities and towns of Java Island
and some key cities in out of
Java Islands. If IT infrastructure
in the larger parts of the country
can be improved, good education
can then be delivered through
e-learning to the remote areas
and isolated islands, so that the
gap on the quality of education
among different parts of Indonesia
can be reduced,” said Hartono.
By ensuring standardized
high quality education across Indonesia,
the nation would therefore
increase its national competitiveness.
Microsoft proposes the following
steps to help bridge the education
divide using IT:
Cloud computing for students
Affordable solutions for going
digital have been provided
with online portals like Live@
edu – a cloud computing Software
as a Service from Microsoft,
which is a free online suite to enable
collaboration and communication
among students, teachers
and parents. It has an email
system, Office Web Apps, webmessenger,
blog and online storage
systems. In 2009, more than
130,000 Indonesian students enjoyed
the benefits of Live@edu.
There has been an approximately
70 percent increase in Indonesia
this year, with more than
220,000 students now using
Live@edu in schools.
One main benefit on the
Live@edu cloud computing service
is that the school don’t have
to invest and manage the IT infrastructure
to provide all of these
services. All school have to do is
to customize the domain name
(to reflect the school name),
which could be free or very low
cost (as low as US$ 9/annum).
The other main benefit for the
student is that the student can
own the email id even after he/
she graduated from the school.
Access to high quality
developer suites for High
Schools, Vocational Schools,
and Higher Education
Free technology has been given
to students, such as through
DreamSpark program, an initiative
which provides free-of-charge
Microsoft software to students.
Within 2009-2010, 118,000 students
in Indonesia were given access
to these tools. We will target
in 2011, another 120,000 students
to be exposed, bringing
the total number of students that
have access to the software tools
to 238,000
Student-2-Business and IT
Academy programmes have also
provided technology training to
more than 10,000 students in
Microsoft Innovation Centres
(MIC) located in five universities:
University of Indonesia (UI),
Bandung Institute of Technology
(ITB), Gadjah Mada University
(UGM), Tenth of November
Institute of Technology (ITS)
and Pelita Harapan University
(UPH). MICs have also provided
students with access to learn
about the latest Microsoft technologies.
Entrepreneurship program for
Post Graduation
Opportunities for entrepreneurship
have been enabled with
the provision of accessibility to
Microsoft software and technology.
This has been achieved
through the BizSpark and
WebsiteSpark programmes.
The initiative provides technology
training through the BizSpark
camp programme, as well as
business readiness through Spark
Gathering activities. In addition,
it works hand-in-hand with other
institutions, such as the United
States Agency for International
Development (USAID), to provide
additional business support
through business competition
and relationships with investors.
IT Capacity Building Program
For teachers
To support digital literacy proliferation,
teachers have been introduced
to Information and
Communication Technologies
(ICT). For instance, IT-Capacity
building for teachers and students,
which entails ICT and
Digital Literacy trainings, has
been provided through peercoaching.
Since its implementation,
the programme has trained
22,000 teachers, which in turn
creates a multiplier effect that embraces
around13 million students
in 12 provinces in Indonesia.
For example on December
2010 Microsoft have conducted
IT training for teachers around
the Community Technology
Center (CTC) in Cirebon. The
CTC in Babakan, Cirebon is one
out of the ten CTCs that TIFA
Foundation established with the
Microsoft CTSP grant last year.
Starting with only 5 PCs, there
have now 22 PCs in the CTC
and its IT training are certified
by the local Diknas (Department
of National Education as to have
a standard of national curriculum
for IT training. With this
certificate, participants are able
to enhance their IT skills and get
a job.
There are many schools in
Cirebon who do not have any
computer labs therefore some
teachers take their students to the
CTC for their IT class. Students
can use the PCs in the CTC for
free. Based on this experience,
President Director PT Microsoft Indonesia, Sutanto Hartono.
Microsoft organized a training
for teachers in the CTC surroundings.
The first training was
attended by 60 teachers and they
will receive a certificate of basic
IT training. For this pilot project,
there will be 60 teachers participating
in the training. They
will be divided into 3 groups and
the teachers will receive a certificate
of basic IT training.
According to master teacher
of Partners in Learning, Rima
Malfiensy from Raffles Consultancy,
teachers were very enthusiastic
to follow the training.
“Teachers who was participating
in the training have really understood
the importance of information
technology in teaching
and learning.”Through continuous
knowledge transfer process,
the Master Teachers can provide
their abilities in creating and developing
digital teaching content
to other teachers. It started in
2003 with 50 Microsoft-donated
PCs to train 350 teachers and
then 500 teachers in the second
year and 800 teachers in the third
year. The number of PCs used for
the program has also increased to
100 units.
Other efforts have also been
made to bridge the digital divide
and increase competitiveness,
particularly in the areas of
rural computing to enable jobs
and opportunities, said Hartono.
By collaborating with local
governments, businesses and
local NGOs, Microsoft seeks to
address the marginalization of
farmers and workers through the
Community Technology Skills
Programme (CTSP). As of to-
day, Microsoft has built over 120
Community Technology Centres
(CTC) throughout Indonesia to
introduce IT to communities in
the hope of “widening their horizons
and empowering them to
make informed choices”.
One such community is in
Bantul, Yogyakarta. Through
IT, the community has learned
to search for information in the
internet and explore methods of
organic farming. “The sales value
of 100% organic rice is higher
compared to ordinary rice, so the
people have decided to intensify
their organic production,” said
Hartono. Such valuable information
would help to bridge the income
gap between the rich and
the poor, and as a result facilitate
Indonesia’s goal of achieving national
competitiveness.
Another initiative takes place
in Cilacap, where education in
email, instant messaging and video
conferencing has connected
overseas migrant workers to their
families and hometowns in Central
Java.
With these programmes set in
place, the road is paved for more
e-government services in the future
– something that can greatly
boost Indonesia’s national competitiveness.
“The use of ICT
can reduce costs significantly in
e-procurement, e-clearance and
improve efficiency through remote
services and e-commerce,”
said Hartono. This could change
the entire social, economic and
political landscape of Indonesia.
The opportunities are infinite –
and this is only the beginning.

B6
January 17, 2011
Property
Outlook Steady for 2011
Jakarta Property Market
Recognizing the prospects for continued
growth in population size and wealth
demographics in Jakarta, the retail sector is
expected to see further new foreign retailers
entering the market in 2011, as well as the
opening of additional outlets by existing
players. Food & Beverage retailers are
expected to continue dominating leasing
demand within the Greater Jakarta area.
RI’s economy to grow by 6.5%
Indonesia’s central bank
raised its 2011 economic
growth forecast to
as much as 6.5 percent
from an earlier forecast
of 6 percent as signs of
accelerating consumer spending
continue. Bank Indonesia projects
that 2011 growth will be a
continuation of this year’s third
and fourth quarter trends, which
reached 5.8% and 6.1% (projected)
respectively.
The Rupiah strengthened
14.6% percent during 2010 as
foreign funds sought to take advantage
of Indonesia’s strengthening
economy. 2011 inflation is
projected at between 4 to 6 percent,
similar to 2010 year-end
levels.
The SBI 1-month rate remained
stable at 6.5% throughout
the 2nd half of 2010 and Investment
Credit decreased slightly
from 13.5% at the end of 2009 to
13.4% by the end of 2010.
Given the continued improvement
of the overall business and
economic environment Indonesia’s
property market appears
set for further improvements in
2011.
Improving demand for CBD
Offices in line with continued
economic growth
Demand is expected to increase
over the next 2 years in
line with projected improvements
in the economy and overall business
climate. Office space absorption
within the Jakarta CBD office
market over the 4th quarter
of 2010 is expected to build on its
strong first nine months performance,
continuing its recovery
from the effects of the global financial
crisis and market downturn
in 2009. In line with the
higher national economic growth
in 2010, total annual absorption
is projected to have doubled from
2009’s figure to over 200,000
sq.m, with occupancy rates likely
to remain stable at 85%.
Average rentals are not forecast
to see further adjustment, as most
landlords already increased their
service charges at the beginning
of 3Q 2010. A likelihood of further
increments is expected however,
with a number of buildings
already planning to raise their
quoting rents for prospective new
occupiers and their lease renewal
offerings for existing tenants.
This is in line with continuing
demand recovery, rising occupancy,
and the economic growth
projections for 2011, despite the
forecasted new supply.
A further 56,500 sq.m within
two office projects in the CBD
area, is expected to enter the market
before the end of 2010, being
Sentral Senayan 3 and SCBD
Lot 18 Office tower 1. As of the
end of 2010, the total cumulative
supply of Jakarta CBD office
space will reach 4.13 million
sq.m. Other major office projects
completed within the CBD
area during the year were: Equity
Tower (83,600 sq.m) in SCBD
and Bakrie Tower (60,000 sq.m)
in Rasuna Epicentrum. Both of
these projects are strata-title office
buildings, and were representative
of the current health of
the Jakarta strata-title office market,
which experienced strong
demand for strategically located
and sensibly priced projects from
reputable developers during the
year.
The cumulative sales rate of
existing strata-title office projects
stands at approximately 91%,
with largely local based companies
looking at strata title office
ownership as an alternative to
their current rented accommodation.
As of the end of 2010, the
strata-title office supply will represent
around 15% of total office
supply in the Jakarta CBD office
market.
The CBD office market will
see additional supply of about
253,000 sq.m in 2011. This new
supply will include office projects
such as Tempo Scan Tower, K
Link Tower, Multi Vision Tower,
Allianz Tower, AXA Tower
and Office 8. Only Tempo Scan,
K Link and Allianz Towers are
office buildings purely for lease,
with the remainder being stratatitle
projects (either partly for sale
or fully for disposal).
Further new foreign retailers
set to open outlets
Recognizing the prospects for
continued growth in population
size and wealth demographics
in Jakarta, the retail sector is
expected to see further new foreign
retailers entering the market
in 2011, as well as the opening
of additional outlets by existing
players. Food & Beverage retailers
are expected to continue dominating
leasing demand within
the Greater Jakarta area.
No further retail projects
are scheduled for completion
through to the end of 2010. An
additional 33,000 sq.m new supply
will come from the completion
or extension of existing centers
in the fourth quarter, such
as Epicentrum Walk and Tanah
Abang Blok B. The total cumulative
supply as of the end of 2010
will reach 3.56 million sq.m;
comprising (67.7%) retail centers
for lease and (32.3%) strata-title
retail centers. New retail centers
completed during the first three
quarters of 2010 included 2 strata-title
projects, namely Jakarta
Gems Center Rawabening in
East Jakarta and Tanah Abang
Blok B in Central Jakarta; 3 specialist
/ supporting retail centers,
such as Epicentrum Walk (CBD
Jakarta), Menteng Central and
C’One Plaza (Central Jakarta);
and 1 one-stop retail center, Gandaria
City (South Jakarta).
Though the active leasing market
during 2010 brought the average
occupancy to 78%, a temporary
decline in occupancy is
expected in 2011, pending retailers
in large-scale retail centers
completing their fit-outs and
commencing trading. In the year
ahead, the Jakarta retail market
will experience further additional
supply of large-scale centers within
mixed-use developments, such
as Kuningan City (55,000 sq.m),
Grand Paragon (40,000 sq.m)
and Kemang Village (56,000
sq.m).
As the performance of stratatitle
retail centers in Jakarta has
not seen improvement, it is likely
that there will be limited further
supply of strata-title retail centers
in the future.
As strong competition in the
retail market continues, rentals
are expected to remain stable and
landlords will remain cautious in
escalating their rentals. Service
charges will likely to increase following
on from the increase of
the electricity tariff in July 2010.
Trend towards condominium
living in the Jakarta CBD to
stimulate demand
The move to high-rise living in
Jakarta within both owner-occupied
condominiums and rental
apartments is set to continue, given
limited land availability and
the practicality of vertical living.
Condominiums in the heart of
the city are also a solution to the
increasing traffic congestion and
Property Sector
lengthening commute times. Despite
this, buyer motivations in
the Jakarta CBD remain equally
divided between investment returns
and owner-occupation (as
primary or secondary homes).
By the end of 2010, total cumulative
supply of condominium
units in Jakarta is forecast to
be approximately 80,700 units.
9 projects will have been completed
during the year, namely
Gandaria Heights, Centro City
(Tower A), Tamansari Sudirman,
Pakubuwono View, Central Park
(Alaina Tower), Green Central,
Seasons City, Masion @ Kemang,
and Gading Nias (Emerald),
while the total number of
proposed condominiums being
sold in the market and projected
to complete within the next
two years amounted to 50 projects
with a total of approximately
19,000 units. Despite the quantum
of this future supply, the current
pre-sales rate of these projects
is already around 56%.
Future condominium supply
will mostly be within the middlesegment,
representing some 60%
of the total proposed supply. The
market will see new supply within
mixed-use complexes in the
Jakarta CBD, such as in Kuningan
City, Ciputra World, Rasuna
Epicentrum, Kota Kasablanka,
and Thamrin City. Meanwhile,
the prime residential area will
continue to target the upper-segment,
as has been the case over
the last few years.
In the current competitive
market, the developer’s commitment
to on-time project delivery
and meeting the promised development
quality will become increasingly
important in ensuring
a successful sales performance.
With the expected reduction in
mortgage rates, the appetite of
condominium buyers is expected
to grow in 2011, with those
condominium projects offering
a unique concept, extensive support
facilities, and strategic location,
able to command higher
prices.
Improving rental apartment
demand but still strong
competition
In the Rental Apartment leasing
market, the higher level of
leasing inquiries towards the end
of 2010 will likely lead to an increase
in leasing transactions and
a modest improvement in occupancy
starting in early 2011. The
physical occupation of condominium-for-lease
units completed
in 2010 is also expected to see an
improvement as we move into the
2nd half of next year, as a minimum
of 6 months is required to
hand-over, fit-out and market the
units. Local tenants are expected
to generate increased demand, especially
for condominiums-forlease
which are in close proximity
to work places or universities.
The predicted economic
growth in Indonesia in 2011 is
also expected to have a positive
impact on expatriate arrivals. Demand
from oil and mining, and
telecommunication companies
is predicted to remain active, together
with a return to higher demand
from banking & finance
related companies.
A more competitive rental
market may be likely however,
given the high competition from
strata-title condominium owners
offering their units to the rental
market. This may also see the offering
of shorter term leases such
as weekly or even daily rates, being
offered in the serviced apart-
The President Post www.thepresidentpost.com
Market Highlight Market Outlook 2011
CBD Offices Permintaan meningkat di kawasan CBD Jakarta sesuai pertumbuhan ekonomi
Retail Beberapa peritel asing akan masuk
Condominiums Trend menuju bermukim di kondominium di Jakarta CBD akan memicu permintaan
Rental Apartments Permintaan meningkat di tengah persaingan ketat
Industrial Tahun yang baik bagi kawasan industri
ment and purpose-built rental
apartment sectors as they compete
with the flexible terms offered
by the condominiumsfor-lease
owners. Some serviced
apartments however, especially
those with better quality operators,
may start to increase their
asking monthly rental rates due
to the increase of their operation
costs following on from the increase
of the electricity tariff in
July 2010.
By end of 2010, the cumulative
supply of rental apartments
will have increased by about 7%,
over 2009, bringing the cumulative
supply to 39,300 units.
This additional supply mainly
came from condominiums-forlease
of about 2,500 units, while
both purpose-built rental apartments
and serviced apartments
Leasing/Sales
Activity
will have experienced decreasing
supply during the year (of 52
units) due to conversion of rental
units to strata-title condomonium
units in Menara Budi and
Residence at Puri Casablanca.
Purpose-built rental apartment
supply in 2011 will largely come
from serviced apartments or ‘condotel’
units.
A positive year for industrial
estates and looks set to
continue
2010 is projected to have recorded
the largest demand for vacant
industrial land in the last 5
years and also seen significant additional
supply of over 700 Ha,
mostly within existing industrial
estates (IE’s) in the Bekasi and
Karawang areas, which remain
the sought after industrial estate
locations.
Occupancy/Sales
Rate
Rental rates/Sales Price
Unlike previous years, in 2010
there was no particular industry
which dominated the market demand,
however several business
lines including automotive and
steel related industries, were notably
active. With the relatively
stable political situation and
more positive economic conditions,
2010 also saw a number of
overseas industrial occupiers, especially
from Japan, re-enter the
Cushman & Wakefield Research
market and these foreign companies
are expected to be the major
demand generators in the short to
medium term.
A combination of increasing
demand and the strengthening
of the Rupiah against USD
is expected to result in achieved
land prices growing by over 10%
and 15%, in Rupiah and USD
respectively during the year (to
about Rp. 700,000 per sq.m or
about USD 80.00 per sq.m).
With new supply unlikely to be
ready for immediate construction
and overall limited good quality
stock, land prices are expected to
continue their upwards trend in
2011. Whilst the market is projected
to remain strong in 2011,
it is unlikely to reach the demand
levels of prior to the monetary
crisis in 1997, but nevertheless
will continue in its current positive
direction.
Media Contact:
Dharmesti Sindhunatha
dharmesti.s@ap.cushwake.com
tel. 021 2550 9500 / 0812 10 13 512
Arief Rahardjo Associate Director 0811 909 711 Kepala Peneliti
Wira Agus Associate Director 0813 1122 3347 Daerah Industri
Soany Gunawan Senior Manager 0812 104 4978 Ritel
Nurdin Setyawan Assistant Manager 0811 1905 252 Perkantoran
Elizabeth Tanti Analis Senior 0818 732 393 Apartment & Kondominium
THE POLO CLUB BAR & RESTAURANT
Menara Batavia 2nd floor
K.H. Mas Mansyur Kav 126
Jakarta Pusat 10230 -Indonesia
Phone : 021 5723767
Fax : 021 5723767

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A place for more than 1500 national and multinational company.
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For more information:
JABABEKA CENTER
Marketing Gallery
Hollywood Plaza, no 10-12
Jl. H. Usmar Ismail - Indonesia Movieland
Kota Jababeka, Cikarang Bekasi 17550
Telp. (+62 21) 893 4570/80
PT. Central Auto Mobil Service
PT. Fu Jyi Lin Indo Enterprise
PT. Daehyun Bobbin Indonesia
PT. Mulya Pratama Agung
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PT Daelim Indonesia
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PT. Indoniaga Sukses Makmur
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PT Toyonaga Indonesia
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Asia
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PT. Suzuki Engineering Center
Indonesia
PT. Chiyoda Kogyo Indonesia

B8
January 17, 2011
Executive Highlights
Finance Minister Agus
Martowardojo said it
would provide letters
of guarantees to three
priority infrastructure
projects
under the public private partnership
(PPP) scheme. The projects
are the US$3 billion, 2x1000
MW coal-fired power project
at Pemalang, Central Java; the
US$750 million railway project
linking Manggarai station, Jakarta
with Soekarno-Hatta international
airport; and the US$250
million water treatment facility at
Umubulan, East Java. Agus said
the risk coverage for the three
projects would be more extensive
than existing guarantees provided
for power projects under the
10,000 MW power acceleration
program. He said the new guarantees
would include coverage
against license cancelation and
operational risks over construction,
land clearing and supply of
electricity and coal. The minister
said there were seven potential
investors from three countries
looking to place bids for these
three projects, though he declined
to provide further details.
Agus stated that two projects under
the government’s PPP scheme
would not be provided with letters
of guarantees: the US$450
million toll road linking Medan
and Kualanamu airport in North
Sumatra; and the US$40 million
Tanah Ampo cruise ship terminal
at Karang Asem, Bali.
Bank Indonesia kept
its benchmark rate
at a record low of
6.5% For the 18th
consecutive month
following its 6 January meeting,
despite mounting inflation pressures.
Consumer prices hit 7%
year-on-year in December, 100
basis points above the upper end
of the central bank’s 2010 inflation
target. The bank did, however,
take a more hawkish stance
in its board of governors’ statement,
asserting that it was fully
aware of inflationary pressures
that could increase in the
future. Central bank executives
have previously stated that they
were prepared to raise rates at
any time if conditions warranted
it. At the same time, Bank Indonesia
governor Darmin Nasution
said current inflation pressures
still stemmed largely from volatile
foods and rising commodity
prices, and indicated that raising
rates now would have limited
impact. He noted that core inflation,
which strips out volatile
foods, remained relatively modest
at 4.2% year-on-year. The
governor asserted that Bank Indonesia’s
main focus now was to
manage surging capital inflows.
These efforts, however, prevent
the rupiah from strengthening,
perhaps helping exports, but also
keeping rupiah prices high.
Bank Indonesia
announced new
measures to deal with
the influx of foreign
portfolio inflows.
Under the new rules, commercial
banks will be required to hold 5%
of their total third-party foreign
currency deposits in reserves at
the central bank starting from
March, up from 1% at current
levels. This will be subsequently
raised to 8% starting in June.
Bank Indonesia governor
Darmin Nasution said the new
regulation was expected to drain
US$3 billion in excess liquidity.
He said the central bank has also
reinstated a cap on commercial
banks’ overseas borrowings of
30% of their capital starting this
month to try and minimize the
risk of sudden capital outflows.
The governor asserted that the
emphasis now was to manage
capital inflows by adjusting
reserve requirements, deepening
the capital markets and keeping
a close eye on global financial
volatility. He added that with
these measures, Bank Indonesia
would be able to avoid tougher
capital controls to discourage
high inflows. Most analysts see
the central bank’s moves as a
positive step to manage excess
liquidity, although it will likely
hit lenders’ profitability and could
cause a substantial increase in the
cost of foreign currency loans.
Bank Mandiri said it
was looking to raise up
to Rp14 trillion from its
rights issue
scheduled for this February, and
announced an indicative price
range of Rp4,000-6,150/share for
the deal. Like the secondary offering
in November last year for
Bank Negara Indonesia (BNI)
the government, which has a
66.7% stake in Mandiri, will not
take up its entitlement of shares.
This will enable institutional
shareholders not currently shareholders
in the bank to purchase a
stake in Indonesia’s largest lender.
Bank of America Merrill Lynch,
Deutsche Bank, Danareksa Sekuritas
and Mandiri Sekuritas have
been appointed to manage the
deal. Bank Mandiri has stated
that it plans to use the proceeds
from the rights issue to strengthen
its capital structure to support
loan growth and general business
expansion. The deal will reduce
the government’s stake in Mandiri
to 60% and raise the lender’s
publicly floated shares to 40%,
qualifying it for a 5% corporate
tax rate reduction provided under
Indonesian tax laws.
Flagship carrier
Garuda Indonesia
has signed a deal
to restructure nearly
US$500 million in debt
after five years of negotiations.
The creditors included
the European Credit Agency,
France’s Compagnie Française
d’Assurance pour le Commerce
Extérieur, Germany’s Euler
Hermes and more than a dozen
commercial lenders. As part of
the deal, Garuda chief executive
officer Emirsyah Satar said both
sides agreed to extend the maturities
of unpaid loans to mid-2016
with repayments to be made in
installments of US$45-60 million
a year. He said the debt restructuring
agreement would
pave the way for a US$300-400
million initial public offering
planned for later this year to fund
its expansion. The carrier is looking
to bring the number of planes
in its fleet to 120 aircraft from
84 currently. The chief executive
also remarked that the deal
would open the door for cheaper
loans from domestic banks, and
make it easier for Garuda to add
routes to Europe and fly to new
destinations such as India.
A consortium led by
global private equity
firm Texas Pacific
Capital (TPG Capital)
has acquired a major
stake in Indonesian
mining services firm
Delta Dunia Makmur
in a US$400 million deal. Ashish
Shastry, TPG Capital’s head
for Southeast Asia, said the deal
was one of the largest equity investments
in Indonesia, though
he declined to provide further details.
TPG Capital partnered with
Singapore sovereign wealth fund,
Government of Singapore Investment
Corp. (GIC), and Chinese
sovereign wealth fund, China Investment
Corp. (CIC), for the
acquisition. Although CIC has
previously funded major deals
in Indonesia, including a US$1.9
billion debt deal last year with
top coal miner Bumi Resources,
it is the first equity investment in
Indonesia for the Chinese investment
fund. Shastry said the latest
deal reflected its confidence in
the long-term prospects of Indonesia’s
coal sector. Delta Dunia is
the country’s second-largest coal
mining contractor through its
wholly owned subsidiary Bukit
Makmur Mandiri Utama.
The Djarum Group
has purchased Rp3.5
trillion worth of shares
in Bank Central Asia
(BCA)
to boost its stake in the lender by
2.3% to 50.2%. The shares were
bought at a price of Rp6,700/
share from undisclosed investors
in a deal facilitated by Credit
Suisse. Djarum used proceeds
collected from a 39% stake sale
in telecom tower operator Sarana
Menara Nusantara in early
December - a deal worth Rp3.3
trillion - to help fund the BCA
share purchase, reflecting a portfolio
shift into the banking sector
from telecom. BCA has accumulated
Rp6.8 trillion in profits
for the first nine months of 2010,
up 17% from the year earlier period.
New loans increased by 8%
for January-September 2010 to
Rp119 trillion. As of end-September
2010, BCA had a loanto-deposit
ratio (LDR) of 50.6%,
significantly lower than Bank Indonesia’s
recommended LDR
range of 78-100%. BCA’s capital
adequacy ratio (CAR) for this period
was 18.7%.
The President Post www.thepresidentpost.com
Australia’s Kangaroo
Resources has entered
into a US$277 million
scrip deal with Bayan
Resources to acquire
a majority stake in the
Pakar coal project
in East Kalimantan. Upon completion
of the deal, Bayan will
acquire a 57% stake in Kangaroo.
As part of the agreement,
Bayan will also incorporate nine
coal concessions near its Tabang
mines in East Kalimantan into
Kangaroo. Bayan said Pakar and
the nine coal concessions combined
would have coal reserves
of around 116 million tons and
coal resources totaling 3.8 billion
tons. Kangaroo managing director
Mark O’Keeffe said the deal
would reposition the company
as a world-scale Indonesian coal
producer, allowing it to unlock
its Indonesian assets by leveraging
Bayan’s skills and experience.
He added that with Bayan’s support
Pakar and the other concessions
could start production this
year. Bayan president director
Selected Instant Indicators
%
8
7
Year on Year
GDP GROWTH (%)
By Quarter
Index*
2000=100
165
6
155
5
145
4
3
2
1
0
05
06
Index
109
106
103
100
07 09
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2005
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Q4
Q1
Q2
2006
Q3
Q4
Q1
Q2
Q3
2007
Q4
Q1
Q2
Q3
2008
Q4
INFLATION 66 CITIES
General
Food
WPI
Q1
Q2
Q3
2009
Q4
Q1
Q2
Q3
2010
107.0
104.9
97
Des J F Mar A M Jun J Aug S O Nov D
09 10
2009 2010
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
EXPORT AND IMPORTS
(US$ Million)
0
Nov D Jan F Mar A M Jun J Aug S O
09
*Q4 2000=100
2009
10
2010
Sumatran Light
US$/barrel
88
83
78
73
M$ 2,578
68
Des
09
2009
$79.4
J
10
Crude Oil-LHS
Palm Oil-RHS
Exports
Imports
COMMODITY PRICES
$91.3
135
125
115
105
95
Nov
10
Mal$ per
metric ton
4,000
M$ 3,814
3,750
3,500
3,250
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F Mar A M Jun J Aug
2010
S O N D
10
Eddie Chin said the deal was in
line with its growth strategy and
would provide significant synergies
with the firm’s other assets.
U.S. Commodities giant
Cargill has acquired
Indonesian industrial
starch and sweetener
producer Sorini Agro
Asia Corporindo in a
US$244 million deal.
Cargill Asia-Pacific president
Bram Klaeijsen said Sorini was
a business with an attractive asset
footprint, solid customer base
and broad product portfolio.
He asserted that the acquisition
would support future growth of
Cargill’s businesses in Indonesia
and South East Asia. Sorini’s
products are used by consumer
goods companies like Nestle and
Unilever as components for the
production of toothpaste, vitamin
C tablets, chewing gum, soft
drinks and ice creams. The firm
currently operates two starch
sweetener plants and five starch
plants in East Java and Lampung.
Cargill purchased 85% of Sorini
from chemicals distributor AKR
Corporindo and securities firm
UOB Kay Hian Pte Ltd. It plans
to hold a tender offer for the remaining
Sorini shares held by the
public next month.
Mitsubishi Corp. Has
extended a US$120
million loan to Medco
Energi International to
support the financing
of the Donggi-Senoro
LNG project
in Central Sulawesi. Mitsubishi
and Medco are partners in the
project, together with Pertamina.
Mitsubishi has a 51% stake
in Donggi-Senoro, with Medco
holding a 20% interest and Pertamina
29%. Funds from the
loan will help finance Medco’s
portion of the project. The loan
carries an interest rate of London
interbank offered rate (LIBOR)
+ 3.75-4.75%. The loan was extended
despite US$3.5 million
in fines imposed on Mitsubishi,
Medco and Pertamina by com-
petition watchdog (KPPU) earlier
this year for allegedly violating
competition rules over
Donggi-Senoro. The KPPU ruling
specially stated that the project
should continue, and senior
government officials like oil and
gas director general Evita Legowo
have also stated that the project
would proceed this year despite
the ongoing dispute.
State power utility PLN
has secured a Rp1.1
trillion syndicated
loan to help finance
construction of its
transmission lines on
Java.
The bank syndicate comprised
Bank Mandiri, BCA, BNI and
BRI. The loan was guaranteed by
the Indonesian government and
has a 10-year tenor with a threeyear
grace period. PLN president
director Dahlan Iskan said
the deal meant the firm has secured
its financing needs to build
its transmission infrastructure as
part of the first phase of the government’s
10,000 MW power acceleration
program. The chief
executive remarked that, once
completed, the upgraded transmission
infrastructure would
help PLN save up to Rp3 trillion
per year. The planned transmission
lines will support the 3x200
MW coal-fired plant in Banten
that came on line last year and
the 3x300 MW coal-fired plant
in Indramayu, West Java and
3x300 MW coal-fired plant in
Rembang, Central Java that are
both scheduled to start operating
this year.
Singapore’s first Real
Estate Investment
Trust (REIT) has
acquired two
Indonesian hospitals in
a US$160 million deal
with Lippo Karawaci.
The hospitals are the Siloam Hospitals
Lippo Cikarang in Bekasi,
West Java and the Mochtar Riady
Comprehensive Cancer Center
in Jakarta. First REIT senior
executive Dr. Ronnie Tan said the
acquisition underscored the huge
potential of Indonesia’s healthcare
sector as economic growth
and wealth generation drive demand
for quality healthcare. He
added the deal would offer the
trust a foothold to expand across
other locations and medical facilities
in the country. As part of
the deal, Lippo Karawaci will act
as master tenant of the hospital
properties. First REIT will have
first right of refusal to acquire
new healthcare facilities that Lippo
Karawaci develops. According
to Lippo Karawaci president
director Ketut Budi Wijaya, First
REIT could potentially purchase
25 hospitals that the firm plans to
build over the next five years to
meet growing demand for healthcare
services in Indonesia.
Nestle Indonesia said it
plans to invest US$100
million to build a new
production facility in
West Java
to serve growing local demand
for its cereal and milk products.
The factory is slated for commercial
operations by 2012 with a
15-hectare complex for the production
of Cerelac infant cereal
and Milo chocolate milk drinks.
Nestle Indonesia currently imports
its Cerelac and Milo products
from Malaysia. The company
said another investment was
earmarked for 2013 to expand
the planned West Java facility to
produce other product categories
such as breakfast cereals and
value-added liquid milks. Frits
van Dijk, vice president for Nestle
Asia, Oceana and Africa, said
the latest investment marked the
firm’s drive to expand its business
in Indonesia. The West Java expansion
marks the second major
investment made by Nestle in
the country, following a US$100
million investment last year to
expand the production capacity
of its milk processing facility in
Kejayan, East Java.
Business Highlights are
contributed to The President Post
by CASTLEASIA/PT Jasa Cita
from information supplied to
members of their CEO Forum,
the Indonesia Country Program.
They are reprinted here with
permission. For more information
about CASTLEASIA programs,
please contact Juliette or Wijayanti
at 62 21 572 7321 or email
castle@castleasia.com subject CEO
Forum

The President Post
SECTION
Economic Review C
Rising
Honda
Production
In an effort to propel economic growth this year,
the government of President Susilo Bambang
Yudhoyono is moving on to reinvigorate the
manufacturing and agro-industry sectors as the
major non-oil-and-gas contributors to state treasury.
This was announced
recently by Minister
of Development
Planning and
Chairperson of Bappenas
(the National
Development Planning Agency)
who is upbeat about the government’s
ability to spur growth this
year.
“For 2011, our plan is to accelerate
economic growth that is fair
to all and this shall be made possible
by implementation of better
management and synergy between
the central and regional
governments,” she says.
Her optimism is apparently
based on the growth momentum
of 2010 which she says needs
to be maximally tapped to generate
further growth this year. And
to realize this, the government
intends to focus on boosting the
manufacturing and agro-industry
sectors which are being relied
upon as good revenue generators
and altogether absorbers of big
numbers of jobseekers.
She explains that the strategy
of bolstering these two sectors is
meant to create multiplier effects
for other sectors of the national
economy because these sectors
Display until February 17, 2011 /// N0. 20
www.thepresidentpost.com
AHM Indonesia produces 20% of the total production of Honda motorcycles around the world amounting to 15 million units, making
Indonesia the second largest production base of Honda motorcycles.
Government to Boost Manufacturing,
Agro-Industry Sectors in 2011
are closely linked with development
of other sectors.
For instance, by boosting the
manufacturing industry, myriad
opportunities will be created
for down-line employment and
in the process the sector shall be
strengthened by participation of
more people on the production
chain.
A clear example is as follows:
Boosting the automotive manufacturing
industry shall lead to
spare parts industries sprouting
up everywhere along with automotive
garages, leasing and car
rental business, intercity travel
service, audio accessory and car
décor businesses and many others.
These will all absorb many
skilled workers who cannot otherwise
find proper job elsewhere.
The same is true for the agro-industry
sector where, for instance,
development of an oil palm plantation
will lead to creation of various
job opportunities down the
line, not to mention revenue generation
opportunities resulting
from further development of the
derivatives of palm oil.
The interaction between all
the stakeholders on the produc-
tion chain shall create complementarity
to ensure survival of
this sector.
“Other sector shall follow if
these two sectors can be developed
well,” the minister says,
adding that with such industrial
development strategy, the government
hopes to see a greater
number of employment opportunities
created henceforth.
As of December last year, according
to government statistics,
the agriculture sector had
absorbed 41.5 million workers
while the manufacturing sector
employed 13.8 million workers.
The trading sector that stands between
these two areas absorbed a
total of 22.5 million workers.
The trading sector is an area
in which many Indonesians even
with low levels of education can
earn a living. In fact, it is here
that most families in urban areas
get their main source of income,
because every single line of the
manufacturing and agro-industry
activities ends up here. It also
employs millions of people from
upstream to downstream levels,
from producers to retailers and
even street vendors.
Based on these facts, the government
is optimistic about being
able to create significant
numbers of new employment opportunities
through reinvigoration
of manufacturing and agroindustry
sectors.
“That’s why we need a driving
force to bolster these two areas
though it means further invest-
By Dewi Savitri
“For 2011, our plan is
to accelerate economic
growth that is fair to
all and this shall be
made possible by
implementation of
better management
and synergy between
the central and regional
governments.”
Armmida S. Alisjahbana
Minister of Development Planning
and Chairperson of Bappenas
ment and further provision of infrastructure,”
she remarks.
In a related development,
Suryo B. Sulisto, Chairman of
Kadin (the Indonesian Chamber
of Commerce and Industry),
says that if the government
wants to see industry grow strong
this year, it needs to lower bank
interest rates to an average of 10
percent, otherwise, domestic industries
will have difficulty competing
against foreign players in
the market.
“The government needs to
have a strong commitment to
lower interest rates below 10 percent
this year,” the Kadin chairman
says, “because our foreign
competitors have lowered theirs
to below 10 percent, in Japan it is
even zero percent.”
Suryo emphasizes that for this
year industry players need a lot of
support from the government in
order to realize the dream of elevating
industrial sector as the
backbone of the economy.
“According to Kadin’s prediction,
our economy can grow by
5.8 to 6.5 percent this year, perhaps
even higher, provided that
the investment climate remains
conductive and the government’s
credibility remains intact in the
eyes of international investors,”
he cautions.
This can actually be realized
if the government and Kadin sit
down together to phase out some
of the problems faced by business
players such as the need to reorient
development strategy toward
strengthening of high-yielding
manufacturing sector be it in
foodstuff or mining. This shall
sever Indonesia’s heavy reliance
on imports and at the same time
eliminate the tradition of relying
on raw material exports.
Energy Sector
In the energy sector, meanwhile,
the government is busy this
month socializing the need to use
gas-fed cars to relax the public’s
heavy reliance on gasoline. This
is logical because unlike in the
past when Indonesia was a net oil
exporter being a member of the
Organization of Petroleum Exporting
Countries (OPEC), the
country is now a net oil importer,
so fuel subsidy is now a source
of headache for the government
whoever the President is.
One way to do this is to encourage
production of gas-fueled
cars and this certainly needs
fresh investment in the automotive
manufacturing sector. This
policy was made public by Budi
Dharmadi, the Director General
for High-Tech Industry at the
Ministry of Industry.
“For this year the government
will emphasize production of gasfueled
cars. The ministry is ready
to supply gas-fueled vehicles and
we have received orders from provincial
governments as well as the
Ministry of Transportation,” he
says.
Throughout this year, the government
will increase by 10 percent
the supply of gas to fuel cars
knowing that this is a more economical
and environment-friendly
option to take.
In line with the official’s explanation,
Industry Minister MS
Hidayat says that the government
has prepared relevant policy
packages to be implemented this
year. He says that the automotive
Photo: The President Post/Nandi Nanti
sector is part of the six priority industrial
development categories
to be focused on this year.
The government will encourage
the growth of domesticallyproduced
components industry,
facilitate development of automobile
design industry, and facilitate
development of vehicles that are
environmentally friendly and affordable
to domestic buyers.
The government will give various
incentives for developing this
sector throughout 2011, the minister
promises. Among the incentives
is a tax exemption policy
for luxury goods, tax holiday for
capital goods, raw material, and
components needed by locallybased
manufacturing industries.
But as the government moves
to discourage the use of subsidized
fuel this year, business analysts
say that this policy should
not be implemented rigidly, lest it
could cause people to turn to bicycles
which need no fuel.
Prihadi chairman of AIPI, the
Indonesian Association of Bicycle
Producers, says that fuel subsidy
removal is not linked to the
growth of bicycle industry, but it
is not bad for it either, as the bicycle
industry is expected to grow
by over 10 percent this year, up
from over six million units sold
last year.
“Whether or not the government
will remove fuel subsidy
does not make much difference
to us because the fact is, more
and more people are turning to
bicycles these days, because they
don’t need to buy fuel in order to
ride their bicycles,” he theorizes.

C2
January 17, 2011
Economic Review
President and his Cabinet ministers have defined
11 priority programs to be implemented this year.
These 11 programs are basically pro-job, pro-poor
and pro-environment in nature.
Despite being criticized
by his political
opponents,
President Susilo
Bambang Yudhoyono
is optimistic
about Indonesia’s chances
of making further progress in
2011.
In an annual address to the nation’s
top leaders, including ministers,
chiefs of high ranking state
institutions, governors, mayors,
and regents recently, the President
said that his optimism was
based on what he defined as four
logical reasons as follows:
First, the momentum for recovery
is taking place, like it or not.
Second, Indonesia still has great
potential in terms of its abundant
natural resourcesthat are yet to be
tapped.
Third, Indonesia has by now
learned valuable lessons from local
and global economic crises
and thereby knows better how
to manage them in the future.
Fourth, Indonesians are basically
optimistic people who always
have ways to overcome problems
no matter how heavy they may
be.
In order to justify his optimism
about the prospects of Indonesia’s
further growth, the President and
his Cabinet ministers have defined
11 priority programs to be
implemented this year. These 11
programs are basically pro-job,
pro-poor and pro-environment
in nature and are summarized as
follows:
First is the program to thoroughly
implement bureaucratic
and management reform. “I want
all of you to move forward in implementing
reform,” the President
emphasized.
Second is upgrading the quality
of education as only through
better education can Indonesia
have the ability to produce better
quality human resources to run
the economy.
Third is upgrading of healthcare
services including better provisions
of medicine for people at
large.
Fourth is reduction of poverty
through concrete programs directly
aimed at the most fragile
The President Post www.thepresidentpost.com
Government Sets
11 Priority Programs for 2011
layers of society.
Fifth is upgrading of food selfsufficiency.
Indonesia used to be
self-sufficient in rice to the extent
the United Nations Food
and Agricultural Organization
(FAO) bestowed the nation
with an FAO medal of recognition
back in 1984. Such is no longer
true today as imports of foodstuff
have become so common in
response to lack of supply and rising
domestic need.
The sixth priority program
the SBY government is focusing
on this year is provision of transportation
infrastructure and better
level of passenger safety, be it
on land, at sea, or in the air. Nevertheless,
there was no mention
of how to ease traffic jams in the
capital city.
The seventh priority program
this year is improvement of business
and investment climate
through streamlining of regulations
and promotion of investor
confidence through ensuring legal
certainty.
Priority number eight is better
provision of electricity across the
archipelago and diversification of
energy through the launching of
new geo-thermal projects. Indonesia
is very rich in this subsector
of energy being a country situated
along the equator but geothermal
and solar energy utilization
for industry has yet to be popularized.
The 9th priority program is replanting
forests that have been
denuded for industrial purposes.
Also important is reclamation
of mangroves along coastal areas
in order to create a better eco-system
to support economic activities.
The government’s priority
number 10 this year is promotion
of coordination between the rich
and poor regions including outerlying
regions bordering neighboring
countries.
The last priority program to
be implemented this year is promotion
and preservation of arts
and local cultures in an effort to
maintain national identity and
promote a national sense of belonging
especially among the
younger generation.
By Widya Sanjaya
President Yudhoyono is optimistic about Indonesia’s chances of making further progress in 2011. The
President said that In an annual address to the nation’s top leaders, including ministers, chiefs of high ranking
state institutions, governors, mayors, and regents recently.
Especially in the sector of people’s
welfare, the government has
also underscored its programs
in order to ensure satisfactory
results. This comes under the
auspices of nine ministries being
supervised by Coordinating
Minister Agung Laksono.
The ministers involved are
Minister for Environment Gusti
Muhammad Hatta, Minister for
Social Affairs Salim Segaf Al Juprie,
Minister of Education Prof
Muhammad Nuh, Minister for
Culture and Tourism Jero Wacik,
Minister of Health Endang Rahayu
Sedyaningsih, Minister for
Empowerment of Women and
Child Protection Linda Gumelar,
Minister of Public Housing
Suharso Monoarfa, Minister
of Sport and Youth Andi Mallarangeng,
and Minister of Reli-
Photo: www.presidensby.info/Abror
gious Affairs Suryadharma Ali.
These ministers have produced
a priority agenda to promote social
welfare throughout 2011,
covering five areas namely education,
healthcare, poverty eradication,
preservation of the environment,
disaster management and
promotion of cult ure, as well as
promotion of creativity and technology
innovation.
The government will this year
put much emphasis on disaster
management and intensification
of rehabilitation programs. Also
on the agenda are action plans for
handling climate change in order
to ensure sustainable living environment
that is conducive to further
economic growth.
To eradicate poverty, the SBY
government will this year focus
on better distribution of rice for
poor segments of society as well
as promotion of social security
network to embrace a larger portion
of the population.
In education, as rightly defined
by Minister Muhammad Nuh,
the government will introduce
a morality-based curriculum in
order to promote good character
among students, so that when
they grow up they will become
responsible citizens with good
character and integrity. This will
in turn help reshape the nation’s
character as a whole, says the
minister.
Education observers say if this
had been implemented long time
ago, perhaps Indonesia would not
have seen so many of its scholars
being dumped in jail for corruption
and various other forms of
bad conduct.
In the sector of healthcare, the
Family Planning program will be
revitalized to involve more young
families which are still in productive
age category.
This FP program has not produced
a very satisfactory result
because despite intensive campaigns
in the past, population
growth still can’t be controlled
in the way the government wants
to see. Rapid population growth
brings along heavier economic
burden to every family and
worse, contraception being used
in FP programs are being misused
for the wrong purposes.
For instance, under Family
Planning program the government
encouraged families to use
contraceptives in order to prevent
pregnancy but later people
used condoms for free sex. This
is an unwanted byproduct that is
a nuisance to both the education
and religious affairs ministers.
Perhaps the most cumbersome
issue for the government is the
negative impact of rising commodity
prices on many families
across the country. Despite the
President’s claim that Indonesia’s
per capita income has risen to
US$3,000, and the economy has
grown markedly in statistical figures,
pressure on families has not
come down these days.
Economic observers
say that in all
fairness, President
SBY performed
quite well last year
as was evident in
overall economic
performance; and
this year he appears
to be a lot more
serious in “whipping”
state apparatus to
perform better. One
simple example was
evident recently
when the president
reprimanded
government officials
who fell asleep or
play with their mobile
phones while listening
to his speech.
This could have been the reason
why former President Megawati
Soekarnoputri recently
urged the government to correct
its social-economic policies in order
to raise people’s standards of
living.
For President SBY, somehow, it
is not easy to translate ideas into
reality unless all components of
national leadership from the capital
city down to regency level
work hand in hand with a common
vision that is sincere promotion
of people’s living standards.
Economic observers say that
in all fairness, President SBY performed
quite well last year as was
evident in overall economic performance;
and this year he appears
to be a lot more serious in
“whipping” state apparatus to
perform better. One simple example
was evident recently when
the president reprimanded government
officials who fell asleep
or play with their mobile phones
while listening to his speech.
“It is not good for people
around the country to see you fall
asleep on television, or play with
your mobile phone! Anybody doing
this should leave this hall,”
the President said, bringing the
rather noisy hall to total silence,
as some in the audience guiltily
put their devices back onto the
table and began to pay attention.

www.thepresidentpost.com The President Post
January 17, 2011 C3
Economic Review
To amplify President
Susilo Bambang
Yudhoyono’s optimism
over Indonesia’s
2011 economic
outlook, Komite
Ekonomi Nasional (KEN) or the
National Economic Commission
has said that investment will
grow by at least 13.4 percent this
year, thanks to sustained political
stability and increasingly positive
macro-economic indicators.
Even as early as August 2010,
President Yudhoyono had said
he expected national economy to
grow 6.3% in 2011 under which
inflation will remain checked at
5.3%, Bank Indonesia’s threemonth
benchmark SBI rate to
float at 6.5% and national currency
rupiah to stabilize around
Rp9,300 per US dollar.
Meanwhile, the President also
expects world oil prices to stabilize
around US$80 per barrel
with Indonesia’s output level of
970,000 barrel per day. A higher
world oil price would not be
conducive to Indonesia’s national
budget because the country is
now a net-oil importer.
Due to this, every time world
oil prices increase by an average
of one US dollar above the ceiling
stipulated in state budget, the
government reportedly incurs additional
subsidy worth Rp2.67
trillion.
If the macro-economic situation
develops favorably in this
direction, there is good reason
for the government to see sound
growth in investment during
2011 as was rightly predicted at
the start of this year by the National
Economic Commission.
The Commission says though
the year 2010 only saw investments
grow by an average span
of 7-9%, this year will see investment
soar to 13.4% due to greater
investor confidence and better domestic
business climate—though
the growth will be gradual in nature.
The Commission also predicts
that uncertainty on global economic
map will somehow decline,
causing greater optimism
for foreign and domestic investors
to either expand their operations
or open new ventures in Indonesia.
In terms of portfolio investment,
the Indonesian Stock Exchange
(ISE) has in recent years
performed so well that there is
now a bigger number of foreign
and domestic investors pouring
their funds into it.
The ISE was even rated as the
best capital market in this region
during 2010 given its rapid
growth and stability. This has
propelled Indonesia’s investment
reputation to a higher plateau and
the country is now approaching a
global investment grade.
Rp124.6 Trillion for Industry
Growth
For Indonesia to reach such
lofty goal, the industry sector
needs fresh investments totaling
Rp124.6 trillion during 2011, according
to Industry Minister MS
Hidayat. With that, the industry
sector is expected to grow 5.6-
6.1% requiring a big chunk of investment
funds going into the
non-oil-and-gas processing subsector.
Such magnitude of industrial
growth will generate employment
for almost 15 million workers,
the minister says, apparently
because this includes investments
in labor-intensive real sector projects.
Minister Hidayat also predicts
positive growth in the export of
non-oil-and-gas industrial products
during 2011. He expects this
National Economic Commission:
Investment to Grow 13.4% in 2011
Meanwhile, the President also expects world
oil prices to stabilize around US$80 per barrel
with Indonesia’s output level of 970,000 barrel
per day. A higher world oil price would not
be conducive to Indonesia’s national budget
because the country is now a net-oil importer.
category of export to generate at
least US$92.26 billion in revenue
this year.
The minister says the government
will focus on six priority areas,
namely labor-intensive, small
and medium-scale industries,
capital goods, natural resource
based, high-growth, and special
priority industries.
His optimism about 2011 investment
prospect is based on
the fact that in 2010 investment
realization far exceeded 4.65%,
the target set by the government
at the start of last year. That itself
was an impressive growth
from 2009 performance of only
1.54%.
The industry minister explains
that means of transportation,
machinery, and industrial
equipment experienced the highest
growth of 8.47%, followed by
fertilizer industry, chemical, and
rubber-based products which
grew 4.82%, whereas the growth
of other manufactured goods was
3.83% during 2010.
However, the biggest contributor
to national industry growth
was food and beverages plus cigarette
products which made a total
of 34.35% growth, while means
of transportation, machinery and
equipment made 28.13%, fertilizers
registered 12.44%, textile,
leather-based products and footwear
contributed 8.71% while
wooden and forestry products
contributed 5.75% to national
industry growth.
Of the many industrial
sub-sectors attracting
foreign investors, one
is worth mentioning
for its unique nature:
shrimp culture. There
was good news at
the start of this year
that investors from
mainland China were
planning to invest up
to 10 billion RMB to
boost shrimp culture
projects in Indonesia.
Shrimp Farming Investment
Of the many industrial subsectors
attracting foreign investors,
one is worth mentioning for
its unique nature: shrimp culture.
There was good news at the start
of this year that investors from
mainland China were planning
to invest up to 10 billion RMB to
boost shrimp culture projects in
Indonesia.
News reports say that investors
from Guolian in Zhanjiang,
wanted to revitalize a shrimp
project in West Nusa Tenggara
and a similar project in Kendal,
Central Java.
The fund is said to have remained
idle in China for some
time and therefore they want to
use it to upgrade shrimp projects
in those two Indonesian provinces,
according to Martani Huseini,
the director general for processing
and marketing of fishery
products at the Ministry of Maritime
and Fishery.
Guolian has China’s largest
integrated shrimp culture center
with an annual production
capacity of 1.2 million tons. Indonesia,
on the contrary, has
not even been able to produce
350,000 tons of shrimp per year,
he says.
The government is hoping that
Chinese investors will come with
transferable technology that will
bolster domestic shrimp production
and teach Indonesians to develop
by-products of the commodity
for export. A delegation
from China will visit Indonesia
in late February this year to finalize
the investment plan.
Ironically, the Chinese are increasing
investment in Indonesia’s
shrimp farming sector soon
after three local companies have
gone bankrupt laying off more
than 6,000 workers, not to mention
13 other such companies
which reduced their output due
to difficulties in marketing.
Thomas Darmawan, chairman
of the Association of Indonesia’s
Fishery Processing and Marketing
Companies, says that a total
of 16 shrimp farming companies
reduced their output from 2008
to 2010 and three of them were
closed down. Today there are 133
such companies still in operation.
He blames lack of supply of raw
material for the decline in shrimp
output which exacerbates marketing
woes.
Investment in Energy and
Mines
Investment in this sector will
pick up this year as there are many
foreign players wishing to step in
if only the government eases regulations
to facilitate business.
Hariara Tambunan, chairman
of the energy development
commission of the Indonesian
Chamber of Commerce and Industry
(Kadin), says that the government
needs to ease regulations
in order to facilitate the entry of
more foreign investors in this sector
especially for coal business.
He says Indonesia does not
have a good supply of coal so the
government should explain what
it plans to do during 2011 to
overcome the shortage. The irony,
he says, is that this country is
very rich in coal and it does not
have enough supply!
This shortage is caused by the
government’s slow response to the
rising need, he argues. With more
than 70 billion tons of coal, Indonesia
has Asia’s largest coal deposit
yet to be brought to surface.
Another annoying issue is the
arduous bureaucracy in licensing
process which causes uncertainty
and lack of investor confidence.
The daily Rakyat Merdeka once
accused Energy and Mines Minister
Darwin Saleh of being “too
slow a mover”, undermining the
sector’s performance and disappointing
potential investors.
The newspaper says that his
slowness was the reason why Japanese
Energy Minister Hiroyuki
Ishige and Nigeria’s veteran Energy
Minister Rilwanu Lukman
cancelled their plans to meet him
some time ago.
Likewise, Senior Vice President
for Asia Pacific of Total E&P Indonesia,
Jean Marie Guillermo,
had to cool his feet for hours before
being allowed to see the minister.
By Widya Sanjaya
Chairman of National Economic Commission Chairul Tanjung. Komite Ekonomi Nasional (KEN) or the National Economic Commission has said that
investment will grow by at least 13.4 percent this year, thanks to sustained political stability and increasingly positive macro-economic indicators.
Nevertheless, many officials at
his ministry say the minister has
performed well so far and is doing
better this year.
“In terms of success rate, it is
unethical for us to evaluate ourselves;
let others do so,” says the
minister’s special assistant, Kardaya
Wardika.
Portfolio Investment
A better barometer for evaluating
Indonesia’s investment prospect
this year is the performance
of the Indonesian capital market.
The market’s composite index
has in recent years soared steadily
in rhythm with rising market
capitalization mainly involv-
Photo: www.inilah.com
ing foreign investors holding for
a long time the bullish industry
stocks.
The number of share issuers has
continued to grow in line with
steadily rising number of corporations
floating stocks, causing
even greater optimism that
portfolio investment is indeed a
worthwhile path to pursue.
Another source of optimism
is the floating of an even bigger
number of market derivatives
which allow investors from
all levels to participate in the
business theater. Many companies,
big and small, have benefited
from the robust climate due to
which they can expand business
without relying on bank loans.
In terms of investment participation,
the market has now seen
new generation of investors, especially
young executives which
comprise a significant portion of
the middle class.
In rhythm with rapid expansion
of the middle class, the size
of local investors’ participation in
the capital market will also become
bigger and bigger in the
years ahead.
So vigorous is the investment
climate that President Susilo
Bambang Yudhoyono has
deemed it necessary to open the
ISE trading himself in early January,
which drew enthusiastic response
from international investors.
Market analysts say that now
is the best time to enlarge investment
participation in the Indonesian
capital market. This bullish
period will last until 2013 when
domestic political temperature
will start rising ahead of Indonesia’s
presidential election.

C4
January 17, 2011
Tourism
The recent volcanic eruptions of Mount Merapi
not only claimed more than a hundred lives but
also displaced tens of thousands of people
who lived on the slopes of the mountain. Aside
from causing property damages, the volcanic
eruptions had also brought Yogyakarta’s vibrant
tourism sector to a temporary halt.
Mount Merapi,
which first
erupted on October
26, 2010
and went on
for about three
weeks, had significantly caused
substantial losses on the local
tourism sector, hurting hotels
and restaurants as tourists decided
to put their trips to the region
on hold.
“Losses on the tourism sector
grew further after Transportation
Ministry’s Directorate General
of Civil Aviation decided to
temporarily close Adisutjipto International
Airport, Yogyakarta,”
said Yogyakarta Tourism Promotion
Board Chairman Deddy
Pranowo.
It is time for Yogyakarta tourism
sector to revive and get back
on its feet now that the eruptions
have subsided to avoid a protracted
decline.
Indonesia Hotels and Restaurants
Association Chairperson
Yanti Sukamdani Hardjoprakoso
said the image of Yogyakarta’s
tourism industry should be restored
immediately.
Yogyakarta is the second most
favorite tourism destination in
Indonesia after Bali and therefore
the tourism sector should
not be left in limbo for too long,
she said.
She said hotel occupancy rate
in Yogyakarta had dropped to
20% due to the eruptions. The
condition was further aggravated
by news from media that scared
off tourists.
The President Post www.thepresidentpost.com
Yogyakarta Tourism Regains Vibrancy
Post Merapi Eruptions
Embrace media to promote
tourism
Efforts to revive Yogyakarta’s
tourism industry were conducted
by all elements in the region
through various ways. All these
efforts were aimed to bring back
tourists, both domestic and foreign.
One of the efforts to restore
Yogyakarta’s tourism image was
by embracing the media, both
domestic and international media
houses.
“To restore image of Yogyakarta’s
tourism industry after the
Mount Merapi eruptions, we had
to embrace the media, both international
and national,” said Association
of the Indonesia Tours
and Travel (Asita) Chairman Edwin
Ismedi Himna.
Asita Yogyakarta also tried to
convince committees of national
and international events to bring
back their events to Yogyakarta
which were canceled or transferred
to other cities.
Meanwhile, a ceremony was
held to welcome the first arrival
of international passengers when
the Adisutjipto Yogyakarta International
Airport was reopened.
The welcome ceremony included
the handing out of batik
scarves to passengers who disembarked
from the plane that flew
from Singapore.
Yogyakarta is Safe to Visit
Tourist attractions in Yogyakarta
have been reopened and are
safe to visit.
“After the eruptions, tour-
ists had asked, either via email
or phone, about Yogyakarta and
we provided them with the latest
situation here,” said Yogyakarta
Tourism Agency Tazbir.
He explained that Mount
Merapi is still active but the danger
zone had been reduced to respectively
10 kilometers and 15
kilometers from the summit for
west Kali Boyong and east Kali
Boyong.
According to him, Yogyakarta
is safe because it is located 40
km away from Mount Merapi’s
summit.
A number of tourism attractions
including Ngayogyakarta
Hadiningrat, Prambanan Temple,
Borobudur Temple, Taman
Sari, Malioboro and others are
Sastro Al Ngatawi,
Head of Lesbumi,
organizer of
“Borobudur Recovery
Art”, said the volcanic
eruptions were a test
but that it should
not demoralize the
society. “The people
should bounce back
and recover from their
sufferings,” he said.
situated outside the danger zone
and are therefore safe for tourists
to visit.
“Social activities in Yogyakarta
have returned to normal and
Yogyakarta is ready to welcome
tourists once again, “said Tazbir.
“Borobudur Recovery Art
“, Part of Efforts to Restore
Tourism
An event called “Borobudur
Recovery Art” was held in the
parking lot of Borobudur Temple,
Magelang, Central Java, recently.
The event was part of the
efforts to restore the tourism industry
after the Merapi volcanic
eruptions.
“This activity was an attempt
to convince the public and the
tourism world that Borobudur
Photo: The President Post/Nandi Nanti
temple is a safe place to visit,” said
Central Java Disaster Mitigation
Agency Logistics and Equipment
Chairman Putu Adi Sutrisno in
Magelang.
“Other tourism supporting industries
that are hit by the volcanic
eruptions are travel agencies,
restaurants, hotels and souvenir
vendors,” he said.
He added now that the volcanic
activities have subsided and
the government has lowered
Merapi’s alert status, it is time for
the real sector and art and culture
sectors to revive.
Sastro Al Ngatawi, Head of
Lesbumi, organizer of “Borobudur
Recovery Art”, said the volcanic
eruptions were a test but that
it should not demoralize the soci-
BOROBUDUR
After being closed down
due to the volcanic ash
from the Mount Merapi
eruption, Borobudur is now
ready to welcome visitors.
The Borobudur temple was
built around the 8th century
by the Syailendra Dynasty.
About 2000 tourists both
international and domestic
visit Borobudur every day.
ety. “The people should bounce
back and recover from their sufferings,”
he said.
He added that aside from organizing
a cultural event and art
performances, Borobudur Recovery
Art also promoted tree planting
activities in Kenalan Village,
subdistrict of Borobudur.
“Planting trees could serve as
reforestation and efforts to prevent
erosions in the future,” he
explained.
Foreign tourists who visited
the Borobudur temple during
the cultural event were also welcomed
with garlands which were
handed out gracefully by dancers.
A mass prayer led by interfaith
leaders was also conducted.

www.thepresidentpost.com The President Post
January 17, 2011 C5
Pictorial Events
Bakrie Micro Credit
without Collateral
PT Bakrie Microfinance Indonesia (BMF) launched microcredits
which are mainly for women. BMF is a charity program and
adopts the concept and philosophy of Grameen Bank, a
microfinance bank in Bangladesh founded by 2006 Nobel Prize
Winner Muhammad Yunus.
BMF officially started to operate in Desa Kalangsari, Karawang,
Jawa Barat.
Text & Photos by Nandi Nanti
Schenker New Sales Office
at Cikarang
Text & Photo by Nandi Nanti
PT. Schenker Petrolog Utama opened its sales office at Cikarang, Jababeka.
President Director of DB Schenker Hauns Hauptmann attended the event.
The New Country Head
and CEO of HSBC
Michael Young has been appointed
the new Country Head and CEO
of The Hongkong and Shanghai
Banking Corporation Limited
in Indonesia. Currently Deputy
Chief Executive Officer and Chief
Technology and Services Officer
for HSBC Turkey, he will succeed
Rakesh Bhatia, who will move to
Hong Kong as Global Head of
Trade and Supply Chain.
The Financial Club Breakfast Dialogue
The Financial Club held the regular Breakfast Dialogue themed
“Management in the New Economy” last December, featuring
Sutanto Hartono the President Director of PT. Microsoft Indonesia.
Text & Photos by Nandi Nanti
Indonesia Australia
Business Council
IABC held a gathering participated by businessmen and professionals, among others
Nick Fenton from Nusa Prima Persada International Consulting, Jeff Tutticci – Aurecon,
Catherine Eddy from Nielsen Indonesia, Malcolm Llewellyn from Boral Indonesia,
Robert Lemmey from Triangle Pase Inc., Terry Moore from JDA, Indonesia, Steve
Young from Siemens Indonesia, and Ms. Rizka An Nisa from Benchmark Recruitment.
Text & Photo by Nandi Nanti
EMO HANNOVER 2011
Text & Photo by Nandi Nanti
Emo Hannover 2011, the machine industry exhibition, will be held at
Hannover Germany, 19-24 September 2011. The press conference was held
at Jakarta and attended by Jan Roennfeld from Ekonid, Martin Thiem from
Deutsche Messe AG and Christop Miller from Emo Hannover.

C6
January 17, 2011
Living
THE 10 MOST SIGNIFICANT
GADGETS OF 2010
If you’d told us in December 2009 that we’d be using the word “iPad”
every day without giggling, well, we would have giggled at you. But there
it is: There’s no getting around the fact that the iPad, silly name and all, has
completely and successfully redefined what a “tablet computer” could be.
Here, then, are the 10 gadgets that were most significant in 2010.
Kindle 3
With a brighter, higher-contrast
screen and a svelte, understated
design, Amazon has finally
nailed the Kindle. There’s still
room to debate the virtues of E
Ink (long battery life, paperlike
readability) versus LCD screens,
but on balance, if it’s reading
you’ll be doing, the Kindle is
tops.
Canon S95
You might be thinking,
“What’s a point-and-shoot doing
on a top-10 list?” That’s how
good Canon’s PowerShot S95 is:
It’s a camera that gives amateur
shooters pro-baller status.
The passenger in
seat 9C was ready for a
nap after takeoff, so he
pushed the button on his
armrest and reclined –
straight into the path of
someone who apparently
wouldn’t have it.
Tensions grew quickly
on the American Airlines
flight from Los Angeles
to Denver on November
22, court papers show.
The incident adds fuel
to a debate that seems to
divide air travelers into
two camps: those who
say that reclining their
seat on a plane is a right
that comes when they
buy a ticket and those
who believe it’s a privilege
that shouldn’t be
abused.
www.thekindlechronicles.com
Air Rage: Is Reclining
Your Seat a Right?
As Brian Dougal
leaned back on the Denver-bound
flight late last
month, he felt someone bump
his seat, according to a criminal
complaint filed in the U.S. District
Court of Colorado.
“Are you serious? My knees are
up against the seat,” said the man
behind him, identified as Tomislav
Zelenovic, according to the
complaint.
Dougal suggested that Zelenovic
also recline, slide into an
empty seat next to him or move
his legs to the side. Dougal told
the man in 10C that he paid for
his seat and was going to recline
it.
This pocketable cam packs
a 10-megapixel sensor, a 9.5mm
(diagonal) sensor, the latest
DIGIC 4 processor (which is
lightning fast), optical image stabilizer,
face detection, the ability
to shoot RAW images and
HDMI output.
Samsung Galaxy Tab
The first Android-based tablet
to be a credible contender to
the iPad, the Galaxy Tab is a remarkably
usable tablet that’s got
a lot going for it. It’s considerably
smaller than the iPad, with a
7-inch diagonal screen compared
to the iPad’s 9.7 inches. But with
an almost identical 1024 x 600
pixel resolution, it’s
got just as much
screen real estate
-- and it’s a good
deal more portable.
MacBook Air
Steve Jobs
called the new
MacBook Air
the future of
computers, and
we like where
this is going.
Coming in 11-
and 13-inch flavors,
the Mac-
Book Air weighs
less than 2.5
pounds, with
a wedge shape
that thins down
to just a tenth-ofan-inch.
Most importantly, it ships with
a flash drive, which makes the
If you’re the passenger who feels uncomfortable when someone
in front of you puts their seat back, you can ask whether they plan
on being reclined for the whole flight, in which case you might
start looking for a different seat
Photo: www.bing.com
Zelenovic then shook the back
of Dougal’s seat and grabbed his
right ear, pulling it back and down
with enough force to knock Dougal’s
glasses off his face, according
to the complaint.
Steve Collins, an Australian
broadcaster who runs the blog
Grumpy’s Getaway Guide, argues
that he shouldn’t have to put
up with passengers who lean back
and invade his personal space.
“I don’t recline my seat, primarily
because I have respect for
the person behind me, and I sim-
Air a surprisingly zippy performer
for its size. And at an attractive
starting price of $1,000, who
wouldn’t consider one of these as
their next notebook?
iPhone 4
Reviewers sang praise for the
device’s gorgeous “retina” display,
which makes reading from
a digital screen as pleasing as a
glossy magazine page. Add to
that a front-facing camera for video
chat, a fast A4 processor and
iOS 4, which enables multitasking,
and the iPhone 4 is a killer
upgrade.
iPhone 4 was Apple’s hottest
iPhone yet, selling 14 million
units in just one quarter.
Sprint Evo 4G
It’s bigger, beefier and more
badass than almost any other
phone we’ve tested this year. And
thanks to its 4G connection,
4-inch screen and ability to beam
out a Wi-Fi signal, the Sprint
Evo makes an excellent traveling
companion.
Windows Phone 7 on
Samsung Focus
In the wake of the iPhone revolution,
Microsoft’s Windows Mobile
OS tanked in market share,
and the software giant decided
in 2008 to scrap everything and
start over.
Based on a fresh tile-based interface,
Windows Phone 7 is an
impressive start. It shines brightly
on the lightweight Samsung
Focus smartphone, which has a
beautiful AMOLED screen and
a solid overall construction.
ply hate it when the person
in front of me shifts
their seat as far back as it
will go,” Collins recently
vented in a blog entry
titled “Ban the reclining
seat on planes.”
“I regard the invasion
of the person’s space sitting
behind me as an
unfortunate, but easily
tolerated, side-effect of
my attempt to achieve
a modicum of comfort
while flying,” wrote travel
guru Arthur Frommer
in his blog this year.
So, is reclining your
seat on a plane a privilege
or a right?
Neither, said Lizzie
Post, etiquette expert,
author and spokeswoman
for the Emily Post Institute.
“It’s not a right; it’s not
a privilege; it’s a function
of the seat that you purchase,”
Post said.
If you want to recline your
seat, there is no obligation to
turn around and assess whether
the person behind you would be
cramped, Post said.
If you’re the passenger who
feels uncomfortable when someone
in front of you puts their seat
back, you can ask whether they
plan on being reclined for the
whole flight, in which case you
might start looking for a different
seat, she advised. (CNN)
The President Post www.thepresidentpost.com
www.dvice.com
Microsoft Kinect
Combining a visible-spectrum
camera and an infrared sensor,
the Kinect offers the most advanced
real-time 3-D scanning
and rendering we’ve seen in a
commercial product. It’s also got
built-in face recognition. The upshot:
Your Kinect can recognize
you, and you can control it simply
by waving your hands and
moving your body.
Berkeley Bionics eLEGS
The feel-good gadget story of
the year, without a doubt, was
a lightweight exoskeleton from
Berkeley Bionics that can help
paraplegics walk again.
At the company’s press confer-
www.tech2.in.com
ence, a person who’d been paraplegic
for 18 years demonstrated
the eLEGS by walking around
onstage.
iPad
The tablet’s beautiful 9.7-inch
screen opens new possibilities for
content creators to make money
by selling apps through the App
Store, but every so often Apple
cracks the whip, demanding programmers
to follow the company’s
vaguely stated but stringently
applied rules.
Apple sold 4.2 million iPads
during the tablet’s first quarter
of existence, claiming the title of
fastest-adopted gadget in history.
(WIRED)
www.dpreview.com
www.technewsandreviews.com
www.hitechreview.com

www.thepresidentpost.com The President Post
January 17, 2011 C7
Living
The Future of Cars:
Drivers Not Needed
It’s conventional wisdom in the auto industry, but
the rest of us may be a bit shocked to find out that
cars of the future likely will drive themselves.
In some ways, they already are.
A
$100,000 car from
Mercedes aims to
give the human
foot a rest in traffic
jams. It senses
how far away other
cars are – and then speeds up and
slows down accordingly. No need
to turn off cruise control and hit
the brake. You just steer. (Wired
Magazine, which tested the car,
called this a “magically scary experience.”)
And tech companies are pushing
car automation even further.
In October, Google announced
it had developed a fleet
of cars that use various sensors
and maps to feel out the roadway.
“They’ve driven down Lombard
Street, crossed the Golden
Gate bridge, navigated the Pacific
Coast Highway, and even
made it all the way around Lake
Tahoe. All in all, our self-driving
cars have logged over 140,000
miles. We think this is a first in
robotics research,” the company
said on its blog.
The latest edition in this trend
comes from General Motors,
which showed off a self-driving
car last week at the Consumer
Electronics Show in Las Vegas.
The EN-V (pronounced “envy”
and short for “Electric Networked
Vehicle”) combines two
ideas about how to teach cars to
drive – using sensors like cameras
and sonar to keep the car from
hitting pedestrians; and network
technology that lets cars talk to
each other.
This “car internet” lets the cars
link up wirelessly and follow one
another in a sort of wirelessly
linked train. If one EN-V needed
to pull out of the line, it could.
The pod-like cars, which are
just prototypes for now (GM says
they could be on the market by
2030 at a cost of $10,000), look
somewhat like large scuba-diver
helmets, or smushed dust busters.
They roll on two wheels, which
are aligned like the front two
wheels of a car, not like a bicycle.
GM partnered with Segway,
maker of those futuristic-looking
transporters, to create technology
that allows the car to balance.
“It’s basically a dynamically
balanced skateboard,” said
Chris Borroni-Bird, GM’s direc-
The Things We
Learned at CES
After tapping dozens of greasy
touchscreens, getting our ears
pinched by 3-D glasses and
braving crowds that would make
a penguin claustrophobic, we
members of the tech media said
goodbye Sunday to the Consumer
Electronics Show.
While the planet’s biggest
technology companies box
up their prototypes and disassemble
their grandiose booth
displays, we’re reflecting on the
past week and what it could
mean for the year ahead.
Here are the things we learned
at CES:
3-D isn’t going away – Disappointing
sales of TVs have not deterred
technology and media companies
from pursuing 3-D products.
We saw 3-D TVs, laptops, cameras,
movies, games, portable devices
and picture frames.
Three-dimensional TVs were a
huge theme at last year’s CES, too,
although cost, shortage of 3-D content
and those bulky special glasses
made consumers wary. This year,
we saw big steps in 3-D big-screen
viewing without glasses, though little
in the way of solidified products.
But in case the home 3-D craze
falls completely flat, television makers
are betting another trend may
help them sell new TV sets or accessories.
We saw all kinds of “smart
TV” systems that connect the big
screen to the content of the Web.
Following the blazing success of
Apple’s iPad, practically every manufacturer
with any kind of expertise in
building screens, gadgets or software
unveiled their own touchscreen
tablets at CES.
Mobile industry watchers expect
Google to repeat its success with
the Android operating system for
smartphones in the tablet category
as well. The company demoed Honeycomb,
its new Android 3.0 operating
system for tablets, at CES to
good reviews.
More than just fun and games
at CES One prototype Honeycomb
tablet, Motorola’s Xoom for Verizon
Wireless, got perhaps the biggest
buzz. LG Electronics offered the G-
Slate for T-Mobile, which also runs
Honeycomb, but the company had
nothing to show at CES besides a
video.
There were dozens of other tablets
running older versions of Android or
a tablet-optimized version of Microsoft’s
Windows 7 operating system.
Or, in Lenovo’s case, both.
tor of advanced technology vehicle
concepts.
The EN-V runs on battery
power and plugs into a wall –
giving it a max speed of about
30 miles per hour and a range of
about 30 miles. That’s not far or
fast, but it’s enough to make the
EN-V useful for cutting down
congestion in urban settings,
particularly high-density cities
in China and India, Borroni-
Bird said.
The car also aims to improve
safety, since human drivers
don’t have a sterling record on
that front. An estimated 1.3
million people die in trafficrelated
accidents each year, according
to the World Health
Organization.
The EN-Vs are just as wide
as they are tall, measuring 5
feet cubed. Two people fit inside
comfortably, but there’s
not much room for anything
else. A bubble of glass sits close
in front of the driver’s face. “You
can probably pack 5 or 6 times as
many of these EN-Vs in a parking
lot as you could conventional
cars,” Borroni-Bird said.
Even though the cars can communicate
with each other and
drive themselves, drivers can take
control if they choose. That’s important,
Borroni-Bird said, both
for safety reasons and so drivers
can get some sense of enjoyment
from the vehicle.
The Consumer Electronics Show, a showcase of cutting-edge gadgets,
took over the Las Vegas Convention Center last week.
One disappointing trend, from
a tech reporter’s perspective, was
the companies’ reluctance to let
the public handle tablets in person.
Many devices were waved about on
stage or displayed behind glass but
not made available for show attendees
to play with.
Celebs are great for hawking gadgets
– What better way to promote
an otherwise dull piece of equipment
than with a familiar face?
Rapper Ludacris was in town to
promote his upcoming line of headphones.
Fellow musician T-Pain
was hawking a microphone. And
49ers football legend Jerry Rice
was scheduled to attend CES – but
bailed days before – to promote a
video game where his character
competes against dogs. (No, that’s
not a joke.)
Lady Gaga, the official creative director
for Polaroid (also not a joke),
arrived about 40 minutes fashionably
late to her event at the camera company’s
booth.
The pop star demonstrated a
portable photo printer she said she
designed herself, which she carries
in her purse, and a bulky pair of sunglasses
with a camera built in. Gaga
encouraged the audience to buy the
sunglasses and bring them to her
concerts.
If Polaroid wanted to make a
splash, it worked: Gaga’s appearance
produced a massive crowd,
swarms of paparazzi and countless
headlines. Whether anyone will actually
buy the sunglasses is another
matter.
Gimmicky things can get buzz-
-Acer’s Iconia, a laptop with two
touch-screens instead of a keyboard,
won a gadget competition
despite not demonstrating a working
version of the product onstage.
The Iconia appears to face some
of challenges. It has the heft of a laptop
without the convenience of being
able to type on physical keys.
Chinese computer maker Lenovo
got some attention for its laptop hybrid
with a removable touchscreen
tablet – despite the fact that the
company showed off basically the
identical gadget at CES 2010.
And several companies introduced
home appliances – refrigerators,
ovens and washing machines
– with internet connections and
touchscreens. Your oven, for example,
can send you a text message
when your roast is about done.
Of course, declaring something
a gimmick before it’s had ample
time to be accepted or rejected by
consumers is probably not fair. Who
knows? Maybe people will really
want to tweet from their fridge.
Gadget ‘Transformers’ – Sometimes
being a really good phone,
laptop or Web-connected entertainment
center isn’t enough. Take Motorola’s
Atrix 4G , for example. It’s all
three.
The Android smartphone is superfast,
with a dual-core processor inside.
But like in the hit “Transformers”
movie, the big reveal comes
when this truck becomes Optimus
Prime.
The Atrix can dock to a laptop
shell or monitor to become a sort
of Android desktop computer, complete
with Firefox for full Web browsing.
Hook it up to a TV, and the videos
and music stored on the device
can be played on the big screen using
a media-center system.
Samsung’s Sliding PC 7 Series
laptop starts out as a touch-screen
Windows tablet. But users can pull
out a hidden keyboard, similar to the
ones on slider phones, which turns
the tablet into a sort of netbook.
(CNN)
Drivers use a joystick of sorts
to steer and throttle the vehicle,
which can spin in place and accelerates
rather quickly.
Still, Borroni-Bird says, there
are a number of obstacles that
need to be hurdled before something
like the EN-V hits the market.
The wireless signals that let the
vehicles communicate are problematic
because hackers, in theory,
could access them and send
Photo: www.gagagadget.com
The EN-V (Electric Networked Vehicle) by General Motors
cars off track; and because a lost
wireless connection could cause
the automated system to lose control
of the car.
“It’s one thing if a computer
goes down, but it’s another thing
if it happens here,” he said.
But he sees a bright future for
the concept.
“For the last 100 years the car
really hasn’t changed in a fundamental
sense,” he said.
Self-driving cars may buck that
trend. (CNN)
3 Expensive
Things You
Shouldn’t Buy
Many people’s financial troubles begin
when they buy an expensive toy or a
vacation home. The buyers assume they’ll
save money because they’ll own the items
instead of renting them. While that might be
true short-term, it rarely works out that way
in the long run.
Here are three things you should never buy
unless you’re rich enough to stop working:
Timeshares
It never makes sense to buy a timeshare, even if you
vacation in the same place every year. Timeshare sellers
will tell you that the rooms are bigger than those in a hotel,
and come with more amenities. What they don’t tell you is
that the glut of timeshares has made it easy to rent one at
a fraction of the cost of buying one.
You could rent a timeshare every year for the next decade
and spend less than you would if you had you bought
it. And you wouldn’t be stuck with maintenance fees.
Boats
There’s an old saying that the two happiest days for
boat owners are when they buy the boat and when they
get rid of it. Boats are a great way to throw money down
the toilet because they cost so much to maintain. There
are repairs, docking fees, gas and insurance. You could
rent a much nicer boat on the days you want to spend at
sea for much less than buying one.
Recreational vehicles
Some people think vacationing in an RV will be cheaper
than staying in a hotel room, but that’s only true if you’re
retired and live in the RV. If you buy a modest vehicle for
$50,000 and use it 30 nights a year for 10 years, you’ll
have spent $167 a night. That can get you a nice room in
most places in the U.S. That doesn’t include the costs to
fuel, store and insure it.
If you want to take a trip in a RV, rent one. You could
also spend less by staying in a four-star hotel.

C8
January 17, 2011
Health
www.trainbodyandmind.com
1Nudge the Scale
Shedding even 10 pounds
can significantly slash your
risk.
Even extremely overweight
people were 70% less likely to develop
diabetes when they lost just
5% of their weight—even if they
didn’t exercise. If you weigh 175
pounds, that’s a little less than 9
pounds! Use our calorie calculator
to see how many calories you
consume—and how many you
need to shave off your diet—if
you want to lose a little.
2Pick the Right
Appetizer
Eating greens with a vinaigrette
before a starchy entrée may
help control your blood sugar levels.
In an Arizona State University
study, people with type 2 diabetes
or a precursor condition
called insulin resistance had lower
blood sugar levels if they consumed
about 2 tablespoons of
vinegar just before a high-carb
meal. “Vinegar contains acetic
acid, which may inactivate certain
starch-digesting enzymes,
slowing carbohydrate digestion,”
says lead researcher Carol Johnston,
PhD. In fact, vinegar’s effects
may be similar to those of
the blood sugar—lowering medication
acarbose (Precose).
3Ditch Your Car
Walk as much as you can
every day. You’ll be healthier—even
if you don’t lose any
weight
People in a Finnish study who
exercised the most—up to 4
hours a week, or about 35 minutes
a day—dropped their risk
of diabetes by 80%, even if they
didn’t lose any weight.
And Chinese researchers determined
that people with high
blood sugar who engaged in
moderate exercise (and made
other lifestyle changes) were 40%
less likely to develop full-blown
diabetes.
4Be a Cereal
Connoisseur
Selecting the right cereal
can help you slim down and
steady blood sugar.
A higher whole grain intake is
also linked to lower rates of breast
cancer, type 2 diabetes, high
blood pressure, and stroke—and
cereal is one of the best sources
of these lifesaving grains, if you
know what to shop for.
Some tips: Look for the words
high fiber on the box; that ensures
at least 5 g per serving. But
don’t stop there. Check the label;
in some brands, the benefits of fi-
ber are overshadowed by the addition
of refined grains, added
sugar, or cholesterol-raising fats.
5Indulge Your Coffee
Cravings
If you’re a coffee fan, keep
on sipping. The beverage may
keep diabetes at bay.
After they studied 126,210
women and men, researchers at
the Harvard School of Public
Health found that big-time coffee
drinkers—those who downed
more than 6 daily cups—had a
29 to 54% lower risk of developing
type 2 diabetes during the
18-year study. Sipping 4 to 5 cups
cut risk about 29%; 1 to 3 cups
per day had little effect.
Caffeine in other forms—tea,
soda, chocolate—did. Researchers
suspect that caffeine may help
by boosting metabolism. And
coffee, the major caffeine source
in the study, also contains potassium,
magnesium, and antioxidants
that help cells absorb sugar.
6Ditch the Drive-Thru
You might get away with an
occasional fast-food splurge,
but become a regular “fast feeder”
and your risk of diabetes skyrockets.
That’s what University of Minnesota
scientists found after they
studied 3,000 people, ages 18 to
30, for 15 years. At the start, everyone
was at a normal weight.
But those who ate fast food more
than twice a week gained 10 more
pounds and developed twice the
rate of insulin resistance—the
two major risk factors for type 2
diabetes—compared with those
who indulged less than once a
week.
Doctor:
We can change the
world with human
embryonic stem cells
By Dr. John McDonald
This year marked what just a decade ago many believed would be an
impossible feat - the first human has been injected with cells from human
embryonic stem cells (hES). hES cells, and embryonic stem cells in
general, are one of the greatest scientific tools for discovery of the 21st
century.
The clinical trial brings together
the best we have to offer
in central nervous system
research to address the difficult
problem of spinal cord injury.
It is a phase I open label
safety trial. To be included, individuals
have to have suffered
a complete thoracic spinal cord
injury, which means no movement
or sensation below the
injury level. The injury to the
spinal cord must have occurred
between the third and 10th thoracic
neurological levels, and
the individual has to be injected
with the stem cell therapy,
called GRNOPC1, within seven
to 14 days after the injury.
Following this initial safety
trial, it will take three to five years to
complete a trial that evaluates the
effectiveness of this approach. If
successful, a FDA-approved cellular
treatment for spinal cord injury could
be developed and on the market
within five to seven years.
Although this trial is evaluating
transplantation of hES cells, the
greatest effect of these cells will not
be as a direct treatment. It will be
from the use of hES cells as a scientific
tool of discovery, accelerating
progress across multiple fields and
leading to effective repair and recovery.
The human genome sequencing
project is similar to the tools offered
by hES cells, and like the human
genome project, hES cell tools will
change our world.
The President Post www.thepresidentpost.com
These simple steps may be all it takes to stay healthy and stop worrying about sugar problems.
These are just a few of the good-for-you habits that can reverse prediabetes and ensure you
never get the real thing, which can mean a lifetime of drugs and blood sugar monitoring, an
increased risk of heart disease, Alzheimer’s disease, and other scary health threats.
What we collectively decide
today will affect our children
and generations to come. This
is an awesome responsibility,
and one that requires risk and
investment. The primary risk
is of the unknown, and this is
not new or unique to hES cell
technology. Remember the
similar fears surrounding the
idea of sequencing the human
genome? Imagine where we
would be today if we made the
wrong decision out of fear or
from personal ethics?
We must not fear knowledge.
We must be decisive
and clear in purpose and allow
science to benefit from all of its
tools. (CNN)
7Go Veggie More
Often
Women who ate red meat
at least 5 times a week had a 29%
higher risk of type 2 diabetes than
those who ate it less than once a
week, found a 37,000-woman
study at Brigham and Women’s
Hospital. And eating processed
meats such as bacon and hot dogs
at least 5 times a week raised type
2 diabetes risk by 43%, compared
with eating them less than
once a week. The culprits? Scientists
suspect the cholesterol in
red meat and the additives in processed
meat are to blame.
8Spice Up Your Life
Cinnamon may help rein in
high blood sugar.
German researchers studied 65
adults with type 2 diabetes who
then took a capsule containing
the equivalent of 1 g of cinnamon
powder or a placebo 3 times
a day for 4 months. By the end,
cinnamon reduced blood sugar
by about 10%; the placebo users
WAYS
TO NEVER GET
DIABETES
improved by only 4%.
9Unwind Every Day
Chronic stress can send
blood sugar levels soaring.
When you’re stressed, your
body is primed to take action.
This gearing up causes your
heart to beat faster, your breath
to quicken, and your stomach
to knot. But it also triggers your
blood sugar levels to skyrocket.
“Under stress, your body goes
into fight-or-flight mode, raising
blood sugar levels to prepare you
for action,” says Richard Surwit,
PhD, author of The Mind-Body
Diabetes Revolution and chief
of medical psychology at Duke
University.
10
Get a Perfect
Night’s Rest
A Yale University study
of 1,709 men found that those
who regularly got less than 6 hours
of shut-eye doubled their diabetes
risk; those who slept more than 8
hours tripled their odds. Previous
studies have turned up similar
findings in women. “When you
sleep too little—or too long because
of sleep apnea—your nervous
system stays on alert,” says
lead researcher Klar Yaggi, MD,
an assistant professor of pulmonary
medicine at Yale. This interferes
with hormones that regulate
blood sugar.
11
Keep Good
Company
Diabetes is more likely
to strike women who live alone.
Women who live alone are 2.5
times more likely to develop diabetes
than women who live with a
partner, other adults, or children,
according to a study published in
Diabetes Care. Researchers examined
what role household status
played in the progression of
impaired glucose tolerance to diabetes
among 461 women, ages
50 to 64, and found higher risk
among women living alone.
Welcome to Our Pediatric Ward!
12
Have a Blood Test
A simple blood test can
reveal whether sugar
levels put you at risk for the
condition. People with prediabetes—slightly
elevated blood sugar
levels, between 100 and 125 mg/
dl—often develop a full-blown
case within 10 years. Knowing
your blood sugar levels are a little
high can put you on a track
to steadying them—with simple
diet and exercise changes—before
diabetes sets in and medications
may be necessary.
Everyone 45 and older should
have their blood sugar levels tested.
Younger people who have risk
factors such as being overweight,
a family history, and high cholesterol
and blood pressure should
ask a doctor about getting tested
sooner. If results are normal,
get tested again within 3 years. If
you have prediabetes, blood sugar
should be tested again in 1 to
2 years.
(www.prevention.com)
www.methodistcollege.edu
Located on the fifth floor of the hospital, our pediatric ward has officially opened in
April 2010. We have created an inpatient pediatric service that provides comprehensive
care for children requiring hospitalization.
Our pediatric ward environment has cheerful playing atmosphere designed to make
your visit to our hospital less scary and fun through out your healing process.
Our friendly pediatric team of health professionals is committed to provide you and
your child a positive experience and the best possible health outcomes. We strive
to achieve open communication with parents and families to involve them in treatment
and diagnostic decision.
We have many pediatrician as well as pediatric subspecialists including experts in
child growth and development, cardiology, children surgery, hematology, neurology,
psychology, children-dentistry and nutritionist.
We also provide special care unit: NICU (Neo-natal Intensive Care Unit). Our NICU
is headed by Neonatologist - pediatric doctors who have undergone subspecialty
training in management of critically ill newborn babies.
Brawijaya Women & Children Hospital provides a child friendly environment by
creating a Patient EduTainment Program. This program offers many educational and
entertainment activities such as: dedicated Kids TV Channel, Clown Visit, Art & Craft,
Visit by Your Favorite Characters, Story Telling, Puppet Show and Music & Play Session.