Monday, June 8, 2009

Business & Trade updates from Jakarta






Indonesian Business & Trade Updates








- Indonesia Boediono: To Make Infrastructure Development A Priority

- PT Nusantara Infrastructure May Launch Rights Issue

- Indonesia Misses $1 Bln Opportunity In Garment Investment

- Indonesia To Up Africa Export To Offset Fall In Traditional Mkts

- Indonesia's Sinar Mas Won't Cut Paper Export Despite Lower Price

- More Indonesian Firms Set To Launch Ipos In 2nd Half 2009

- Indonesian Property Firm Targets 23pct Rise In Sales

- Indonesia's Icon+ To Finish Fiber Optic Telecom Cable Pjt Soon

- Indonesia Predicts 3pct Rise In Foreign Tourist Arrivals

- Indonesian Tourism Finds Way Round European Flight Ban

- Indonesian State Engineering Firm To Revitalise Sugar Plants

- Indonesian Chemical Firm Sets Lower Sales Target

- Indonesian national carrier to fly new Airbus-330s to Seoul,Shanghai

- Indonesia Has Enough Ships To Fully Implement Cabotage Principle

- Thailand sells 20,000 T corn to Vietnam, Indonesia

- Indonesia, Germany Expand Land And Marine Cooperation
(Courtesy Joyo News Service)

Indonesia Boediono: To Make Infrastructure Development A Priority

JAKARTA, June 8 (Dow Jones)--Indonesian vice presidential
candidate Boediono said Monday that improving the country's
infrastructure will be a key focus if he is elected in July.

"Our first priority if elected will be to speed up
infrastructure development," Boediono told reporters.

He called infrastructure "the launchpad for economic development
and welfare for the people," but said Indonesia's infrastructure
was "far behind."

Boediono, an economist and former central bank governor, said he
would consider revamping the state budget to allow more
efficient disbursement of funds for infrastructure.

Boediono is running with current president Susilo Bambang
Yudhoyono. Opinion polls show the duo with a strong lead in
public support ahead of the July 8 election.

------------------------------

PT Nusantara Infrastructure May Launch Rights Issue

JAKARTA, June 8 Asia Pulse - PT Nusantara Infrastructure
(JSX:META) has said it may launch a rights issue in the second
half of 2009, in order to raise Rp450 billion (US$45 million) in
fresh funds.

A rights issue was an option to raise funds needed to finance
business expansion and repay debt, M Ramdani Basri, the
president of the road construction company, said.

Nusantara has three toll roads operated by its subsidiaries - PT
Bintaro Serpong Damai, PT Bosowa Marga Nusantara and PT Jalan
Tol Seksi Empat.

Ramdani said that Rp200 billion of the funds would be used to
service its debt of Rp800 billion to Bank Mega.

Last year, the company posted Rp189.62 billion in income up
19.31% from the previous year, the newspaper Investor Daily said.

-------------------------------

Indonesia Misses $1 Bln Opportunity In Garment Investment

JAKARTA, June 8 Asia Pulse - Indonesia has failed in attracting
investment valued a US$1 billion in garment making industry by
South Korean, Chinese and Taiwanese investors.

The foreign investors have opted to invest in Vietnam and
Bangladesh, making the two countries stronger competitors for
Indonesia in the world garment market, the Indonesian Textile
Association (API) said.

API chairman Ade Sudrajat said many garment makers in China,
South Korea and Taiwan are relocating their factories moving
production basis to other countries where production is more
efficient.

The government was too slow and lack the courage to take a quick
decision, API deputy chairman Ade Sudrajat said.

The US$1 billion investment would have created up to 5 million
new jobs and increased the country's share of the world garment
market to 2 per cent, Ade was quoted as saying by the newspaper
Bisnis Indonesia .

Currently , the country's share of the world garment market is
not more than 1 per cent, against Vietnam's 1.16 per cent and
Bangladesh's 1.65 per cent valued t US$10 billion a year, Ade
said.

-------------------------------

Indonesia To Up Africa Export To Offset Fall In Traditional Mkts

JAKARTA, June 8 Asia Pulse - Indonesia is set to chalk up a 20
per cent increase in its exports to US$3.2 billion to Africa
this year.

The country hopes to boost exports to Africa to offset a decline
in exports to major industrialized countries, the Indonesian
Chamber of Commerce and Industry (Kadin) said.

The country's exports to traditional markets, the United States,
the European Union and Japan have declined on global financial
crisis.

Chairman of the African Committee Mintardjo Halim said African
countries are hardly affected by the global economic woes.

Meanwhile, Standard Chartered Bank offers support to facilitate
trade between Indonesian and African countries.

The support will be in the form of banking service to facilitate
export and import between Indonesia and African countries, a
bank director Rahil Taneja was quoted as saying by the newspaper
Investor Daily.

--------------------------------

Indonesia's Sinar Mas Won't Cut Paper Export Despite Lower Price

JAKARTA, June 8 Asia Pulse - Indonesia's largest paper maker PT
Sinar Mas said it would not cut exports despite sagging demand
and falling price in the world market.

The company would exports paper at least the same in volume as
last year although most likely it would earn less, a company
executive said.

Yan Partawijaya, a company director, said demands for papers
shrank in the United States and Europe on global crisis
resulting in a decline in the prices of paper as well as pulp.

The company will seek to expand sales to smaller consuming
countries to offset the decline in sales to the traditional
markets, Yan was quoted as saying by the newspaper Bisnis
Indonesia

In the first four months of this year, Indonesia's exports of
paper including carton paper were valued at US$1.02 billion down
19.7 per cent year-on-year.

--------------------------------

More Indonesian Firms Set To Launch Ipos In 2nd Half 2009

JAKARTA, June 8 Asia Pulse - More companies are expected to
launch an initial public offering (IPO) in the second half of
the year, with the improved confidence of investors in the
country's economy.

The composite index of the Indonesian Stock Exchange has risen
notably, with an leapfrogging increase in eight consecutive days
until last week to cross the psychological level of 2,000 points.

The composite index gained at least 53.04% since the end of last
year, the third-highest growth in the Asia Pacific region after
Shen Zen's 65.77% and Shanghai's 51.25% last week.

Previously, many Indonesian companies have delayed plans to
launch IPO as a result of the global financial crisis, but
analysts said they are expected to implement their plans in the
second half of this year.

A number of companies are expected to launch an IPO in the third
quarter of this year, the newspaper Investor Daily said.

One of the country's largest steel makers, Gunawan Jaya Steel
hopes to raise at least Rp150 billion (US$15 million) from the
IPO it is planning in the third quarter of this year.

---------------------------------

Indonesian Property Firm Targets 23pct Rise In Sales

JAKARTA, June 8 Asia Pulse - Publicly-traded property company PT
Summarecon Agung (JSX:SMRA) has said it is set to chalk up a 23%
increase in sales to Rp1.55 trillion ($US155.5 million) this
year, over last year's record of Rp1.26 trillion.

The 25 basis point cut to 7% earlier this month in the benchmark
interest rate of Bank Indonesia would make the property market
bullish, company President Johanes Mardjuki said.

Johanes said he could not predict net profit this year, but that
it should increase after falling to Rp94.1 billion last year
from Rp159.84 billion in the previous year, on an increase in
interest rate and foreign exchange losses.

This year the company planned to invest Rp80 billion, the
newspaper Investor Daily said.

This would include a hotel project.

------------------------------

Indonesia's Icon+ To Finish Fiber Optic Telecom Cable Pjt Soon

JAKARTA, June 8 Asia Pulse - PT Indonesia Comnets Plus (ICON+),
a subsidiary of Indonesia's state electricity company PLN said
it hopes construction of its fiber optic telecommunications
system in Sumatra would be finished before the end of this year.

The Rp375 billion (US$37.5 million) system would be linked with
Java - Bali - Lombok, , ICON+ President Mulyo Adji said.

In Java-Bali, construction the fiber optic system , which was
built earlier is already completed and in operation.

The Java-Bali system will extended from Java to Sumatra and from
Bali to Lombok this year, Mulyo told the newspaper Bisnis
Indonesia

ICON+ operates telecommunication and information service for PLN
utilizing the electric cables of PLN, the newspaper Bisnis
Indonesia said.

------------------------------

Indonesia Predicts 3pct Rise In Foreign Tourist Arrivals

JAKARTA, June 8 Asia Pulse - Culture and Tourism Minister Jero
Wacik has predicted that foreign tourist arrivals in Indonesia
will increase by three per cent in the second semester of 2009.

"The foreign tourist arrivals will mainly come from Asian
countries who decided to make holiday trips to Asian nation as
well," the minister said here on Sunday.

The number of foreign tourists coming from Europe and the United
States was predicted to drop slightly due to economic crisis
which had affected those countries.

In the meantime, Asian tourists preferred to holiday in Asian
countries so that the tourism industry in Asia would grow.

"Asian tourists chose to visit nearer countries," the minister
said.

Earlier, chairperson of the Indonesian Hotel and Restaurant
Association (PHRI), SB Wiranti Sukamdani said the growth of the
Indonesian hotel and restaurant market up to the end of 2009 was
expected to reach two to three per cent.

This growth could be achieved if hotel and restaurant operators
were active in launching and offering package products to
attract visitors.

Wiranti said it was expected that the hotel and restaurant
market would grow by three per cent in the first semester of
2009, because there were a number of international events such
as the Asian Development Bank`s conference in Bali and the World
Ocean Conference (WOC) in Manado, North Sulawesi last month.

In April, she said, Indonesia held a legislative election which
also had positive impact on hotel occupancy rate, the use of
hotels` meeting rooms and visits to restaurants.

But in the second semester of the year, the hotel and restaurant
market was also expected decline if operators did not take
immediate anticipatory steps, she added.

"Hotel and restaurant operators must be active in launching
promotions to attract visitors so that hotel and restaurant
growth in the second semester of the year would not decline,"
she added.

---------------------------------

Indonesian Tourism Finds Way Round European Flight Ban

PADANG, W Sumatra, June 8 Asia Pulse - Indonesia has been able
to find another way to increase the number of visiting European
tourists to Indonesia, despite a ban imposed by the European
Union Commission on Indonesian airlines, an official of the
Ministry of Culture and Tourism said.

"We regret the ban but we are still able to find another way how
to increase the number of European tourists to Indonesia," Nia
Nurcaya, director for convention, incentive and promotion
affairs of the Ministry of Tourism and Culture, said here over
the weekend.

She said that airlines were main component that supported
Indonesia`s tourism development but the Indonesian airlines were
still banned from flying in European airspace.

In the face of the ban, the government, in this case the
Ministry of Tourism and Culture, had allowed foreign airlines to
increase the frequencies of their flights to Indonesia.

"This means that tourists can come with foreign airlines to
Indonesia. Thus, Indonesia is facilitating foreign airlines
flight frequencies to Indonesia," she said.

For this purpose, the government has granted increased flight
frequencies for the Singapore Airlines to fly tourists to Bali.

The aim of this cooperation is to fly European tourists to
Indonesia through Singapore. Previously, many Russian tourists
flew to Singapore but the number of flights from Singapore to
Bali was still small.

With the cooperation, the Singapore-Bali flight frequencies have
been increased, and a problem faced with the flight ban is
overcome, she said.

Ideally, foreign tourists coming to Indonesia should be flown by
Indonesian airlines but due to the flight ban Indonesia has to
seek other ways to maintain the number of foreign foreign
tourist arrivals in the country.

"What is important for the tourism and culture ministry is that
foreign tourists are able to come to Indonesia with any other
airlines," she said.

-------------------------------

Indonesian State Engineering Firm To Revitalise Sugar Plants

JAKARTA, June 8 Asia Pulse - State engineering company PT
Rekayasa Industri (Rekin) will handle the revitalization of
three sugar factories, to cost around Rp65 billion (US$6.5
million).

The revitalization of the factories owned by state plantation
companies - PTPN XIV, PTPN VII and PTPN XI - would be completed
by the end of 2009, Rekayasa President Triharyo I Soesilo said.

After the revitalization, the productivity of the three
factories would rise six-fold from 1,000 tons to 6,000 tons a
day, Triharyo said.

The cost of revitalization had been reduced with the use of
locally manufactured milling equipment and turbines normally
imported from Singapore, he said.

The program to revitalize the country's sugar industry, launched
first in 2007, aimed to increase the country's production from
2.2 million tons to 3.2 million tons a year.

----------------------------

Indonesian Chemical Firm Sets Lower Sales Target

JAKARTA, June 8 Asia Pulse - Publicly-traded chemical company PT
Unggul Indah Cahaya (JSX:UNIC) has set a lower sales target of
US$300 million this year, compared to US$343.54 million last
year.

The target had been set lower as the price of its product alkyl
benzene had declined, corporate secretary Lily Setiadi said.

Lily said the company hoped to increase sales in volume by 5% to
141,390 tons of alkyl benzene this year to offset part of loss
from the price fall.

Demand for that chemical on the domestic market, which will
absorb most or 95% of its production, was substantially strong,
she was quoted as saying by the newspaper Investor Daily.

---------------------------

BBC Monitoring Asia Pacific
June 8, 2009

Indonesian national carrier to fly new Airbus-330s to Seoul,
Shanghai

Text of report in English by website of independent Indonesian
news magazine Tempo on 8 June

[By Arif Firmansyah] Monday, 8 June, Jakarta: Garuda Indonesia,
the state-controlled air carrier said it would start flying four
new planes from Airbus next month. Emirsyah Satar, chief
director of Garuda Indonesia, said on Monday the four new
A330-200 - which [are] capable of providing internet and
telephone services - were to arrive separately in Indonesia.

Emirsyah said the planes [were] to serve mid-range flights to
Seoul and Shanghai, starting from July, at the sidelines of the
65th annual meeting of the International Air Transport
Association. Garuda said it [is] also to fly five new [Boeing]
B737-800 next generation by the end of the year.

Source: Tempo website, Jakarta, in English 8 Jun 09

---------------------------

Indonesia Has Enough Ships To Fully Implement Cabotage Principle

JAKARTA, June 8 Asia Pulse - Indonesia has enough ships to
transport coal to fully implement the cabotage principle that
bans foreign-flagged ships from carrying domestic cargoes.

Indonesia started implementing the cabotage principle in phases
since 2005 allowing only ships flying the Indonesian flag to
handle inter-island shipments of commodities such as rice and
cooking oil.

Foreign ships are still allowed to handle the transport of coal
until the principle is fully implemented next year.

The Indonesian National Ship owners' Association (INSA) said it
has finished taking inventory of Indonesian coal carriers.

INSA deputy chairman L. Sudjatmiko said 18 of 24 units of coal
transporting ships of various types, and 943 units of 974 barges
fly the Indonesian flag.

Therefore, foreign ships were no longer needed for
inter-Indonesia coal transport, Sudjatmiko said.

The transport ministry said it had prepared a document of
ratification for the International Convention on the arrest of
ships as part of the government plan to fully implement the
cabotage principle in 2010.

The ratification will allow creditors to demand the arrest of
ships in the event of the failure of the ship owner to repay
debt.

Sea transport and traffic director Leon Muhammad said
ratification of the convention on arrest of ship was needed to
support the program to implement the cabotage principle in the
country.

----------------------------

Thailand sells 20,000 T corn to Vietnam, Indonesia

BANGKOK, June 8 (Reuters) - Thailand has sold 20,000 tonnes of
corn to feedstuff companies in Vietnam and Indonesia for prompt
shipment, traders said on Monday.

"The corn was sold at $205 per tonne free on board and we
expected to ship all of it within June," said a trader at a
major Thai corn exporting firm.

He said the first 10,000 tonnes was sold to Vietnam and the rest
to Indonesia. Domestic corn prices traded at 7.50 baht ($0.219)
per kg on Monday, down from last month's 8.50 baht per kg.
Prices were expected to slip over the next few months in line
with easing future prices on the Chicago Board of Trade (CBOT),
which sets the global trend.

CBOT July corn contract fell 4-½ cents to settle at $4.44
a bushel Friday.

Rising supply in Thailand also weighed on prices, traders said.
Around 200,000 tonnes of corn was expected to be harvested in
June and July.

The government cancelled a tender last month to sell 450,000
tonnes of corn from the state's stockpile due to low bids.

Traders offered to buy at 2.50-5.75 baht per kg, well below 8.50
baht per tonne that the government bought from farmers during
the intervention scheme that expired on March 31.

The government was estimated to hold around 1 million tonnes of
corn it has bought from farmers during an intervention scheme.

Between January and April, Thailand exported 141,098 tonnes of
corn, down 37 percent from the same period of last year when it
shipped 224,750 tonnes.

"We can't export as much as last year because most of corn
supply were drained into the government stocks since early of
the year," one trader said. ($1=34.28 baht) (Reporting by
Apornrath Phoonphongphipaht; Editing by Clarence Fernandez)

----------------------------

Indonesia, Germany Expand Land And Marine Cooperation

JAKARTA, June 8 Asia Pulse - Indonesia and Germany have observed
30 years of their bilateral relations by expanding cooperation
in land and marine affairs.

Head of the Statistic Data and Information Center of the
Ministry of Marine and Fishery Affairs Soen`an Hadi Poernomo
said in Jakarta, Sunday that the agreement was reached on the
sidelines of the World Ocean Conference 2009 in Manado, North
Sulawesi.

The two countries agreed on a more integrated and comprehensive
land and marine cooperation.

In capacity building, the training program will be increased by
seeking more opportunities for Indonesian students to study
marine affairs in Germany.

Besides, efforts will also be made to empower the marine
faculties of the universities in Indonesia by hiring professors
from Germany to teach in Indonesia, he said.

And to optimize the cooperation between the two countries, he
said open scientific meetings will be held regularly each year
to disseminate and evaluate the progress of the ongoing
cooperation.

On the occasion, a book bearing the theme "Success Story of 30
Years of Indonesian-German Cooperation in Science and
Technology" will be launched. (ANTARA)

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