Wednesday, June 24, 2009

Business & Trade updates from Jakarta

- KS Oils Buys 35,000 Acres Of Palm Plantation Land In Indonesia
- Indonesia's Q1 CPO Export Earnings Shrink 54%
- Jakarta Futures Exchange Launches First Physical CPO Market
- Indonesian State Airport Operator Chalks Up Higher Net Profit
- Indonesia Not To Ratify Tobacco Convention
- IT Investment Can Boost Indonesia's Economic Growth: Kadin
- Indonesia's Semen Gresik Postpones C. Java Plant Project
- Indonesia Lobbying Japan To Increase Garuda Flight Frequencies
- Indonesia's NTB To Launch 'Visit Lombok Sumbawa Year' In 2012
- Japan To Bring Investors To Indonesia: Envoy
(Courtesy Joyo News Service)

KS Oils Buys 35,000 Acres Of Palm Plantation Land In Indonesia
MUMBAI, June 24 (Dow Jones)--India's K.S. Oils Ltd. (526209.BY)
Wednesday said it bought an additional 35,000 acres of palm
plantation land in Indonesia.
K.S. Oil's palm plantation land bank assets in Indonesia now
stand at 85,000 acres, of which 50,000 acres was bought in 2008,
the country's largest processor of oilseeds said in a note to
the Bombay Stock Exchange.
Indonesia's Q1 CPO Export Earnings Shrink 54%
JAKARTA, June 23 Asia Pulse - Indonesia's exports of crude palm
oil shrank 54.02 per cent in value year-on-year to US$1.07
billion in the first quarter of 2009.
The decline in the export earning was a result of falling price
of 48.22 per cent and 11.2 per cent decrease in sales volume,
said Elfian Effendi, the executive director of environmental
organization Greenomics Indonesia
Elfian, however, noted significant rise in export volume to a
number of countries in the European Union, which has been known
to strongly call for boycott of palm oil products from Indonesia.
Exports to the EU rose 15.38 per cent to 490,458 tons in the
first three months of this year from the same period last year
though shrinking in value by 40.87 per cent to US$229.87 million.
The EU has accused Indonesia of opening large oil palm
plantations at the expense of the country tropical forests.
Jakarta Futures Exchange Launches First Physical CPO Market
JAKARTA, June 24 Asia Pulse - The Jakarta Future Exchange has
launched Indonesia's first organized physical market for crude
palm oil, which will be traded exclusively on line in an attempt
to create a new price benchmark, a JFX executive said.
Trade Minister Mari Elka Pangestu and State Minister for State
Enterprises Sofyan Djalil attended the debut Tuesday kicking off
online trading of the commodity.
Trading CPO through the JFX offers local industries the
opportunity to directly sell their products, said JFX President
Hazan Zein Mahmud was quoted as saying by the newspaper Investor
Daily .
Hazan said if the domestic physical CPO market grew, it could
become another barometer for the global market, beside Kuala
Lumpur and Rotterdam.
So far only state plantation company PT Perkebunan Nusantara and
state agro-industry company PT Rajawali Nusantara Indonesia
selling CPO using the JFX online trading system, he said.
Indonesian State Airport Operator Chalks Up Higher Net Profit
JAKARTA, June 24 Asia Pulse - Indonesian state airport operator
PT Angkasa Pura (AP) II reported Rp692.39 billion (US$69
million) in net profit in 2008, up from Rp493.52 billion in the
previous year.
The company posted a 13% increase in operating profit to Rp777.3
billion, with operating income of Rp2.057 trillion or an
increase of 11%, its President Edi Haryoto said.
Jakarta's Soekarno-Hatta and Medan's Polonia airport were the
largest contributors to the income of the company, which
operates 12 airports in the country, the newspaper Investor
Daily said.
Air traffic service accounted for 35% of total income and the
rest from non-aeronautical services such as landing fees and
public service charges, Edi said.
Indonesia Not To Ratify Tobacco Convention
JAKARTA, June 23 Asia Pulse - Indonesia is set to reject
ratification of the tobacco convention despite protests from non
governmental organizations.
Industry Minister Fahmi Idris said Indonesia will not ratify the
framework convention on tobacco control (FCTC) on a number of
reasons, citing the tobacco industry contribute considerably to
state revenues and provides many jobs
Signatories of the FCTC are required to reduce cigarette
production, ban tobacco advertisements, raise cigarette tax, ban
smoking in certain places and ban children from buying
Chairman of the Indonesian Consumers Institute Foundation Tulus
Abadi said the government's decision would cause more complex
social problems in the country.
Tulus said 12 million of 19 million Indonesians living below the
poverty line were smokers.
IT Investment Can Boost Indonesia's Economic Growth: Kadin
JAKARTA, June 24 Asia pulse - Investment in communication and
information technology infrastructure facilities could help
accelerate economic growth, Anindya Bakrie of the Indonesian
Chamber of Commerce and Industry (Kadin) said.
"The telematics industry can help develop not only itself but
also Indonesia`s economic development with the application of a
communication and information technology (TIK)," Bakrie, who is
also Kadin deputy chairman for TIK affairs told a workshop on
TIK investment and economic growth.
Through the workshop, Kadin tried to do its best to produce a
road map for TIK development. The road map would be submitted to
the next government for the 2009-2014 period.
"We are planning to submit the results of this workshop to the
government later in August or September, after the new
government has been designated," Bakrie said.
He said that TIK infrastructure facilities also needed to be
built as backbone of this industry which would in the end also
support the overall growth of the people`s economy.
"The development of TIK facilities have big multiple effects on
Indonesia`s economic growth so that we hope the government would
listen to the inputs that Kadin would provide," Bakrie said.
He said that the government received 0.75 per cent in non-tax
revenue from the TIK sector. For this purpose, Bakrie asked the
government`s help build infrastructure facilities in this field.
The Kadin deputy chairman hoped that all layers of the people
would enjoy data-based services in less than the next five years.
The role of the private sector in this case was expected to
increase although it had to face regulations and high tax.
He said that the TIK industry could develop itself. Wen the
prices of all industrial products were increasing, those of TIK
industries were adversely declining, which is an indication that
TIK was already able to reach the people.
In order to support the development of TIK facilities, Kadin
hoped that a public private partnership program would be carried
out as a joint funding between Kadin`s ICT fund, and the
government`s assistance fund from the state budget.
Indonesia's Semen Gresik Postpones C. Java Plant Project
SEMARANG, June 24 Asia Pulse - Indonesia's PT Semen Gresik
(JSX:SMGR) has decided to postpone the construction of a new
cement plant in Pati, Central Java, until 2011 due to public
"The situation now indeed is not conducive so that the
construction of the plant cannot as yet be realized as planned,"
the company`s spokesman, Saefuddin Zuhri, said here on Tuesday.
Due to that, he said, the company would now focus on its plant
construction project in Tuban, East Java. "This will be the
fourth in Tuban," he said.
He said focus would be put on construction of cement plant in
Tuban with a view to meeting increasing demand from year to year.
"Later, production from the plant in Tuban will be used to meet
demand in 2012. Unless new plants are built Indonesia will
predictably suffer a shortage of supply," he said.
Saefuddin denied that PT Semen Gresik had left Pati and shifted
its investment to Tuban.
"After the project in Tuban is finished PT Semen Gresik later in
2011 will continue the project in Pati," he said.
He said PT Semen Gresik remained interested in investing in
Central Java.
"The plant in Pati is expected to meet cement demand in 2015
when Indonesia is predicted to start facing a shortage again,"
he said.
Regarding this issue the secretary of the Central Java
administration, Hadi Prabowo, said that so far the regional
administration had not received any official information about
"Even the governor of Central Java has not yet received any
information about it," he said.
"What is clear is that we are now still cooling down because
some still reject while others already agreed," he said.
Regarding the company`s decision to shift its focus on other
regions, Hadi said that it was a decision a company would
normally take to assure implementation of a plan linked to
corporate budget.
"Every year a state-owned company has to make a budget plan
because shareholders do not want their money to be idle. So the
second alternative is building the plant in Tuban," he said.
He said however that the process of land acquisition would
continue. "Normatively it is mere postponement because the
process of compensation payment still continues," he said.
Indonesia Lobbying Japan To Increase Garuda Flight Frequencies
TOKYO, June 24 Asia Pulse - Indonesia's Ministry of
Transportation has sent a letter to the Japanese government,
asking for increased flight frequencies for flag carrier Garuda
Indonesia for the Jakarta - Tokyo route from seven to 13 flights
a week, a diplomat said.
"The Indonesian Embassy here also continues to lobby the
Japanese government so that it would comply with the Garuda
request. For Indonesia it is quite reasonable to ask for
additional flight frequencies owing to the fact that the
Japan-Indonesia flights have developed positively," Indonesian
Ambassador to Japan Jusuf Anwar said here on Tuesday.
The ambassador made the remarks in connection with a plan by
Garuda Indonesia to Increase its flight frequencies for the
Jakarta - Tokyo route beginning on August 1, 2009.
So far, Garuda Indonesia`s flight from Jakarta to Tokyo has to
transit in Denpasar so that the flight time lasts longer or
about six hours.
Flights from Osaka ( five times a week) and Nagoya (three times
a week) to Denpasar, Bali, are served directly.
According to Faik Fahmi, Garuda Indonesia area manager for
Japan, South Korea, China, the United States and Canada,
businesses have demanded a non-stop and direct flight between
Tokyo and Jakarta.
"The demand for such a flight is understandable because a non
stop Jakarta - Tokyo direct flight will only take four hours.
For businessmen, saving two hours is something very
significant," Faik Fahmi said.
So far, Garuda serves the Jakarta-Denpasar-Tokyo route with
Boeing 747 aircraft. If Garuda`s request for increased flight
frequencies to six times is complied with, it will use wide
bodied airplanes, namely type A330.
Based on that considerations, Garuda Indonesia contacted the
Japanese aviation authorities to ask for a license to increase
its flights.
"We also coordinated with the Indonesian embassy in Tokyo in its
capacity as Indonesia`s official representative in Japan in
order to accelerate the process to obtain an additional flight
frequency license," Faik said.
Indonesia's NTB To Launch 'Visit Lombok Sumbawa Year' In 2012
MATARAM, West Nusa Tenggara, June 23 Asia Pulse - Indonesia's
West Nusa Tenggara (NTB) will organize a promotion, "Visit
Lombok Sumbawa Year", in 2012 in the Senggigi tourist resort
area on July 5, 2009, a provincial tourism official said.
The promotion night would be attended by Tourism and Culture
Minister Jero Wacik and highlighted with various arts and sport
attractions, Lalu Gita Ariadi, head of the NTB tourism and
cultural office, said here on Tuesday.
"The tourism and culture minister and NTB Governor Zainul Majdi
will start the event by giving a press conference and it will be
followed by a `Public Corner` television program on Metro TV on
July 2, 2009 at 2 pm Western Indonesian Standard Time (WIB)," he
On July 5, Sunday, NTB will also organize a seminar on
ecotourism with speakers among others from the tourism and
culture ministry.
The tourism promotion event will also be highlighted with a
fashion show featuring traditional woven clothes designed famous
Indonesian designer Samuel Watimena. A contest of "Pearl Beauty
Pageant" will also be organized to select a tourism ambassador
of NTB.
NTB hopes to attract at least one million tourists through the
The Visit Lombok Sumbawa Year 2012.
According to data of the Central Bureau of Statistic (BPS), NTB
was visited by 16,880 people, consisting of 13,821 domestic
tourists (81.88 per cent), and 3,059 foreign tourists (18.12 per
cent) in March 2009.
The March 2009 figure was an increase of 44.87 per cent from
11,652 tourists in February 2009.
The hotel room occupancy rate in NTB in March 2009 was 35.36 per
cent, up from 31.65 per cent in the previous month.
More than 1.893 million tourists visited Indonesia in the first
four months of 2009, up 1.53 per cent from the same period last
Japan To Bring Investors To Indonesia: Envoy
JAKARTA, June 24 Asia pulse - Japanese Ambassador to Indonesia
Kojiro Shiojiri said his government will soon bring investors to
Indonesia following continued improvement of Japan`s economy.
"I cannot confirm the schedule, but our government`s policy is
already there, namely to bring investors and investment to
Indonesia," Ambassador Kojiro Shiojiri said on Tuesday.
In the near future, the Japanese government would bring
investors to Indonesia, especially to invest in the fields of
infrastructure, agriculture, and plantations.
The bilateral relations between Indonesia and Japan were
currently very close particularly in the economic field, he said.
The cooperation includes an Indonesian-Japanese economic
partnership aimed at boosting the two nations` economies,
especially in Indonesia.
"The government of Japan will continue to intensify cooperation
in various fields with Indonesia, especially in the economic
field," Ambassador Kajiro Shiojiri said after giving a public
lecture at the University of Dharma Persada.
The Japanese ambassador`s lecture was titled "Development of
Human Resources to Face Manpower and Industrial Markets".
Some 500 students of the private university listened to the
Japanese ambassador`s lecture.
It was reported early this year that Japan would extend at least
US$500 million in trade financing to Indonesia this year to
assist the Southeast Asian country`s economy.
The US$500 million financing package comes after Japan doubled
the size of a currency swap with Indonesia to US$12 billion
earlier this year.
Japan will also provide US$1.5 billion in guarantees for
Indonesia`s planned yen-denominated bonds, and a standby loan
commitment of US$1.5 billion this year.
Yamada said during the Group of 20 summit in London, Indonesian
President Susilo Bambang Yudhoyono had requested Prime Minister
Taro Aso for Japan to increase its investment in Indonesia`s
oil, natural gas and coal sectors.
Indonesia, Southeast Asia`s biggest economy, is the
second-largest supplier of LNG to Japan after Malaysia.

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